Asian coatings consumption to grow by 8% through 2009.

The coatings consumption in Asia is forecasted to increase at an annual rate of 8% through the year 2009, according to a new report from Kusumgar, Nerlfi, & Growney entitled The Asian Coatings Study. In 2004, coatings consumption in the region surged to 7.9 MM metric tons with a sales value

China and India are the fastest growing coatings consumers in Asia, both expanding at double-digit rates. China has recently surpassed Japan to become the largest coatings market in Asia. In 2004, China accounted for 42% of the coatings volume and one-third of the dollars in the region. Coatings demand in China is being propelled by a strong housing market, infrastructure building, the increased domestic consumption of goods, and growing exports. Coatings usage in India is also expanding because of a growing housing market and infrastructure building. However, India is significantly behind China in the manufacture of most goods utilizing paint.

In contrast to China and India, coatings consumption in Japan has stagnated. Japan remains the largest consumer of automotive coatings in Asia, but China is expected to surpass it by 2009. Responding to the low domestic growth of recent years, Japanese coatings producers have expanded their presence in other Asian countries.

In 2004, China, Japan, South Korea, and India represented just over 80% of the coatings volume and dollars in Asia. Japan's and South Korea's share of the Asian coatings market is projected to decline. In 2004, the two countries combined were 27% of the coatings tonnage, but are forecast to fall to a 20% share by 2009. The combined share of coatings tonnage for China and India is expected to rise from 54% to 63%.

The Asian Coatings Study can be obtained from Kusumgar, Nerlfi & Growney by contacting 973.439.0030 or nerlfikng@cs.com.

ASIAN COATINGS CONSUMPTION IN 2004 BY COUNTRY, IN MILLIONS

Country      Metric Ton  $       % AGR

China        3.34         6,676  11
Japan        1.31         5,343   0
Korea        0.85         2,785   3
India        0.95         1,857  10
Taiwan       0.32           942   3
Thailand     0.26           701   5
Indonesia    0.19           475   7
Malaysia     0.14           412   5
Vietnam      0.12           381   7
Singapore    0.11           325   4
Philippines  0.15           301   4
Other        0.18           340   9
TOTAL        7.92        20,538   8