The market for liquid waterproofing did not decline as much as expected during the pandemic. The following years will be characterised by a strong catch-up process, but this will be curbed by a high price increase. In 2022, for example, the market will grow by 22.6% in value, while sales will increase by only 4.9%, according to a new study by Interconnection Consulting.

The sharp rise in prices will weigh on market growth in the coming years. The high price increases will also shift consumer preference towards cheaper product segments. “Therefore, at least in some countries, such as Italy and Poland, there are already increasing market shares for cement as well as bitumen products, which are cheaper than other variants,” says Giacomo Tomada, the author of the study. However, liquid polymer waterproofing will, in contrast, decline in market share. In 2021, this segment accounted for 37.9%, making it the strongest product segment followed by bitumen at 29.4% and cement 20.4% in volume. In value terms, the share was as high as 68.9% due to the higher price of liquid polymer waterproofing. This form of waterproofing is most popular in France, Germany, the UK and Switzerland. In Italy, on the other hand, cement takes the largest share with around 43%. The renovation segment is a stronger sales market than the new construction segment with 55.3%.

Germany Dominates the Market

With about 20.8% in volume, Germany is by far the largest market for liquid waterproofing in Europe. The market value in Germany is € 544 million. Poland follows in second place, with a share of 12.1% due to strong construction activity. This is then followed by the United Kingdom with 7.9%. The fastest growing markets are Spain, Turkey and Italy, which show an average growth of 7.6%, 7.3% and 6.8% annually until 2025. The stronger growth is mainly due to the poorer market performance in these countries during the COVID pandemic and, in the case of the UK, the poor performance at the beginning of the Brexit. Russia is the only country with a negative performance until 2025 (CAGR -2.2% in volume), due to sanctions and the related economic crisis.

Diversification Pays Off

Competition in the industry is very high, especially among the market-leading companies, but there is still enough room for smaller companies. During the pandemic, it was evident that companies with strong diversification, both in terms of products and markets, were the most successful in weathering the storm, in many cases even avoiding declining sales. Some of the most important companies are Triflex, Sika, Mapei, StoCretec, Soprema, Weber, Remmers, Evonik, BASF and MC Bauchemie.

The study examined the following markets: Austria, Belgium, France, Germany, Italy, Netherlands, Poland, Russia, Spain, Switzerland, Turkey, United Kingdom, Rest of Europe.

The market volume for liquid waterproofing in the DACH region rose from €128 million to €133 million in 2021, an increase of around 3.8%. This year, the industry’s turnover is expected to increase by a further 4.6%, according to a new study by Interconnection Consulting.

Dominant Product Segment

Sales growth will remain positive in the DACH region despite the high price increases for raw materials and energy. However, the picture is different in the three countries. In Germany, sales will increase by 3.8% annually in the years up to 2025, in Switzerland by 3.5% and in Austria by only 0.9%. Overall, there is a slight decline in expensive product segments such as liquid polymer sealants due to the strong price increases. However, this product category continues to dominate unchallenged in the DACH region. In value, this product segment has a share of 81.8%, while the share in volume is 53.6%. Bitumen and cement could become the big winners of the increased prices. Cement and bitumen currently have a value share of 7.1 and 5.8% respectively.

Not Just for Buildings

Germany’s share in the DACH region is 78.8% in volume, ahead of Austria with 12.2% and Switzerland with 9.0%. Overall, the renovation sector accounts for about 59% and new construction for about 41%. Residential construction is the largest application area with 47%, followed by civil engineering (building construction, civil engineering…) with around 24%. Overall, buildings account for about two thirds of the liquid waterproofing market. The most important companies in the DACH region for liquid waterproofing are: MC Bauchemie, Remmers, Soprema, Bauder, Mapei, Sika, Triflex, BASF, BMI.

The European sealing and filler market (sealants, adhesives, PU foams, joint sealing tapes) increased in value by 9.6% in 2018, reaching a market volume of EUR 1.2 billion. Driven by the increase in the construction industry, the market is expected to maintain its momentum in the coming years. According to a new study by Interconnection Consulting, the industry in the surveyed countries (Germany, Austria, Switzerland, France, the Benelux region, and Italy) will increase in value at an average rate of 9.0% until 2021.

Nearly 60% of total sales in Europe are generated in the non-residential building segment. In terms of value, however, price increases, which must be passed on to the customer due to increased raw material costs, are also a major driving force. Germany is by far the largest market for joint sealants in Europe, which is expected to grow at an annual rate of roughly 9.5% and reach EUR 547.2 million by 2021. France, the next largest market, had a share in value of over 25.0% of total sales in 2018.

Sealants Dominate

Sealants, accounting for 45.6% of total value in 2018, were the strongest product group on the market. It is dominated by silicones, whose share in terms of value accounted for 56.2%. Nevertheless, the market share of silicones is decreasing in favor of hybrids/MS polymers. “Industry insiders feel that hybrids, which will pick up the market share losses in the silicon segment, have great potential in the European marketplace,” states Julia Tarasenko, author of the study. The second largest product group is joint sealing tapes. Adhesives are close behind, though, with a share of 23%. They also stand a good chance of further increasing their market share. Until the year 2021, their projected average growth will be 10.0%, which is higher than the industry average. Joint sealants are largely employed in the window and door segment, which garners a share of 26.9%, followed by sanitary engineering and flooring. In addition to these applications, roofing, curtain wall facades, EIFS, HVAC, drywall and other applications were each analyzed, separately for indoor and outdoor use.

Green Trend Increases Market Concentration

As the study shows, market concentration is likely to increase in the sealing and filler market in Europe’s top 6 regions. This is because companies need resources for research and development in order to keep up with the current “green trends” and to meet the corresponding regulatory requirements. The Italian market is already considered to be very saturated. As a result, local market players are having a tougher time expanding and are forced to either focus on other products and solutions, or to implement new solutions and technological innovations in order to gain market share from competitors.There is an abundance of companies in the European market for joint sealants, whereby the main players include Arkema Group, DOW Chemicals, EGO Sealants, Griffon, Henkel, Herrmann Otto, Mapei, Otto Chemie, Sika, Soudal, Tremco Illbruck etc.

The European market for liquid plastic floor coatings increased in value by 20.4% last year. However, sales increased only minimally with a plus of 1.4% in 2021. However, a strong increase in sales of 6.5% is expected for 2022, as a new study by Interconnection Consulting shows.

Different Demand Drivers for Liquid Plastic Coatings

The strong increase in sales in the industry was mainly due to the price increase, which in turn was caused by the shortage of raw materials. In addition to the production stops in Asia in 2020, the shortage was also due to the winter storms in Texas, where one of the largest warehouses for plastic resin was badly affected.

The growth is being driven, among other things, by a high level of construction activity, increased demands for aesthetically pleasing surfaces, stricter hygiene standards and outdated parking garages that now need to be renovated. Increased conversions of buildings are another market driver – in Germany, for example, the transformation of the automotive industry to e-mobility, which is why WHG coatings are increasingly being requested. There is also a strong trend towards anti-static (ESD) floors, which are becoming a requirement in more and more production facilities due to the increasing use of computer chips. Clean rooms and clean rooms in laboratories and production halls, for which manufacturers also develop their own solutions, represent another area that is gaining in importance.

A substitution of ceramic floors with liquid synthetic floors, for example in canteen kitchens, fast food establishments, or in the food industry, also harbors growth potential for liquid resin-based floor coatings. Especially in the food sector, 3-component products such as PU concrete floors are being used more and more, which meet the special requirements in this area due to their resistance (e.g. hot water resistance), whereby the use outside of DACH for this type of coating is significantly higher.

Due to high opportunity costs during standstill, fast-hardening resin floors are used more and more frequently, not only in canteen kitchens, on industrial areas, but also in parking garages (especially in the entrance and exit areas and ramps), whereby the high costs of polyaspartics /polyurea, but also emissions (VOC), which play a role in PMMA, limit an even more frequent use of these products, precisely because price is often a key decision criterion.

Substitution with Other Types of Floor Coatings Slows Down Growth

Market growth in Western Europe could be even higher if liquid plastics were not increasingly substituted here by cementitious products or, more recently, by hydrophobic impregnations to a certain extent. The former were also less affected by the scarcity of raw materials and the sharp increase in the price of raw materials for liquid plastic products, making them even more attractive in terms of price.

Germany with the Largest Share

The study examines the ten largest markets in Europe. With a share of 30.2%, Germany is by far the largest market, followed by France and the Netherlands. The countries Italy and Spain recorded the strongest increase in sales last year with more than 26%. Romania, on the other hand, has the greatest growth potential in the next few years with average annual growth rates of over 10%, although the market in Romania is still significantly less saturated than in other countries.

Industrial Floors Are the Main Customers

The dominant binder in all markets examined is epoxy resin. In Germany, this floor coating accounts for 51.1%. Austria has the highest proportion at 55.9%, while Belgium has the lowest at 37.1%. In addition to epoxy resins, the study also examined the importance of polyurethanes (PU), PMMA (polymethyl methacrylate), acrylates, polyurea & polyaspartics, as well as “other product groups” (e.g. PU concrete. The customer segments are dominated by production facilities & factories – i.e. classic industrial floors in 7 out of 10 markets Only in Austria, Switzerland and Romania are the parking garages the largest sales segment.

Strong M&A Activity in the Market

In Germany, the market concentration of the top 5 companies is 72%. Sika in particular was able to significantly expand the group’s market position thanks to its already very strong position in many European countries through the recent takeover of the MBCC Group (also one of the top 5 players in many countries). Basically, the market is currently in a dynamic period with many takeovers. This is also the case in France, where Mapei, for example, recently gained a strong position with the takeover of Resipoly.

Der Markt für Fugenabdichtungen (Dichtstoffe, Klebstoffe, Schäume, Fugen- Dichtbänder) im DACH-Raum  hat 2018 einen wertmäßigen Anstieg von 10,1% verzeichnet und hält nun bei einem Marktvolumen von 487 Mio. Euro. Getrieben durch den Anstieg in der Hochbauindustrie soll der Markt auch in den nächsten Jahren die Dynamik beibehalten. Bis 2021 wird das durchschnittliche Wachstum 9,2% jährlich betragen, wie eine neue Studie von Interconnection Consulting zeigt.

Deutschland wächst am stärksten

Neben der starken Bautätigkeit stellen in Deutschland auch Preissteigerungen einen wesentlichen Treiber dar, die aufgrund gestiegener Rohstoffkosten an den Kunden weitergegeben werden müssen. Dies führt zu einem CAGR von 9,5% und einem prognostizierten Marktvolumen von 547,2 Mio. Euro bis zum Jahr 2021. Mit 46,1% sind die Dichtstoffe die stärkste Produktgruppe in Deutschland. Vor allem durch den Preisanstieg von Silikonen haben im Bereich der Dichtstoffe Hybride das größte Wachstumspotential. Klebstoffe sind die zweitgrößte Produktgruppe, die mit einem Anteil von 23,9% dicht gefolgt werden von den PU-Schäumen (22,7%).

Schweiz und Österreich mit ähnlicher Entwicklung

Auch in Österreich sind es hauptsächlich die Preisanstiege, die zu einer deutlichen Steigerung des Umsatzes beitragen (CAGR bis 2021 7,3%). In Österreich sind Klebstoffe mit einem Marktanteil von 35,2% die umsatzstärkste Produktgruppe, gefolgt von Dichtstoffen mit 30,1%. Danach folgen die PU-Schäume mit 27,2%. Ähnliches wie in Österreich gilt für die Schweiz, wo das CAGR bis 2021 6,5% beträgt. In der Schweiz sind die Dichtstoffe mit einem Anteil von 36,1% die wichtigste Produktgruppe. Danach folgen Klebstoffe mit 23,6% und PU-Schäume mit 21,3%.

Grüne Wende verstärkt Marktkonzentration

Die Marktkonzentration bei Fugenabdichtungen wird, wie auch in Gesamteuropa in der DACH-Region zunehmen. Denn die immer höheren Ressourcen die notwendig werden um Forschungs- und Entwicklungsaktivitäten durchzuführen, um mit den aktuellen „grünen Formulierungstrends“ Schritt zu halten und die einschlägigen regulatorischen Anforderungen zu erfüllen, werden vor allem größere Unternehmen bevorzugen. Die wichtigsten Unternehmen in der Branche sind Sika, Soudal, Tremco Ilbruck, Hermann Otto, Arkema Group EGO Dichtstoffe, Henkel, PCI.