Paints and Varnishes (Russian Market)

2023

3.9% increase in sales of water-based paints to 1.01 million tonnes

In 2023, sales of water-based paints and varnishes in Russia reached 1.01 million tons. This is 3.9% more compared to 2022, when the volume of sales was estimated at 969.3 thousand tons. Such data are given in the BusinesStat study, the results of which were published in early December 2024.

Analysts take into account various paint materials in an aqueous environment - on acrylic and vinyl polymers, as well as on other synthetic polymers or chemically modified natural polymers. Among the significant players in the industry are named Caustic JSC, Knauf Gips LLC, Tikkurila LLC, Fine Metal Powders LLC, Akzo Nobel Decor CJSC, etc.

According to estimates, in 2019, sales of these products in Russia amounted to 686.8 thousand tons. In 2020, the volume of sales soared by 43.5%, reaching 985.7 thousand tons. In conditions

self-isolation amid the COVID-19 pandemic, people began to pay more attention to improving their homes and more often carry out repairs on their own, independently purchasing the necessary materials and tools. In 2021, an increase of another 1% was recorded - up to 995.6 thousand tons. In addition to maintaining the trend for home repairs, an increase in the consumption of paints and varnishes was facilitated by an increase in the volume of housing commissioning in Russia.

However, a 2.6% decline followed in 2022 due to a worsening geopolitical situation. Manufacturers faced problems in the field of commodity security and the organization of supply chains, which led to higher prices and falling sales. At the same time, despite statements about the termination of activities in Russia, many foreign producers either transferred their assets to local management, or continued to work as before, citing contractual obligations, which allowed the market to return to growth in 2023.^[1]

In Russia, the production of paints and varnishes increased by 9.3%, reaching 1.6 million tons

The production of paints and varnishes in Russia increased by 9.3% in 2023, reaching 1.6 million tons. Data on production growth was published in November 2024 as part of an analysis of the industrial sector.

According to Rosstat, the production of paints and similar coatings, including printing and art paints, increased by 17.2%, amounting to 598 thousand tons. In December 2023, the production of this category reached 46.5 thousand tons, which is 21.4% more than in December 2022.

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Freepik

According to the analytical company Creon, decorative materials account for 74% of the total output, industrial - 26%. The share of imported products on the Russian market is 16-18%, having decreased from more than 30% in 2018.

The volume of imports of paints and varnishes in 2023 decreased by 15% to 131 thousand tons. There was a redistribution of suppliers: the leadership in the import market was shared by China and Turkey with a share of 24% each, displacing the EAEU countries from leading positions.

The growth of production is supported by the active development of the construction sector. In 2023, more than 110 million square meters of living space were commissioned in Russia, which is a record figure.

Sibur has begun the production of maleic anhydrides, the base raw material for various resins that improve the properties of paints and varnishes. Projects are also being implemented to build the first automated LCM plant in Russia in St. Petersburg.

According to analysts, the total consumption of paints and varnishes in Russia in 2023 amounted to 1.2 million tons. At the same time, the production capacities of most Russian manufacturers are loaded by no more than 50%, which creates the potential for further growth of the industry.^[2]

Growth in the production of paints and varnishes in Russia by 12% to 2.19 million tons

In 2023, approximately 2.19 million tons of paints and varnishes were produced in Russia. This is almost 12% more than in the previous year, when the output of the corresponding products was estimated at 1.96 million tons. Domestic enterprises managed to overcome the difficulties that arose against the background of a worsening geopolitical situation. Industry statistics are provided in the BusinesStat report published on June 10, 2024.

The data cover a variety of products, including polyester, acrylic or vinyl polymer paints, paints for artists, printing paints, pigments, glass and paint silencers, enamels and glazes, etc. Among the largest enterprises in the Russian industry are named PJSC Nizhnekamskneftekhim, JSC Caustic, LLC Knauf Gips, JSC Omsk Rubber and PJSC Khimprom.

According to estimates, in 2019, about 1.53 million tons of paints and varnishes were produced in Russia. A year later, output rose 26.3% to 1.93 million tons. In 2021, production increased by another 4.1% - to 2.01 million tons. And in 2022, a 2.6% decline followed. In general, in 2019-2021, the production of paints and varnishes in the Russian Federation rose by 31.5%.

The study notes that a feature of the Russian industry is the presence of a significant number of foreign companies that have localized their production in the country. In 2022, due to geopolitical tensions, Finnish Tikkurila and Teknos, Dutch, the AmericanDuPont AkzoNobel Danish, Hempel Norwegian and announced the suspension of activities or complete withdrawal from Russia. Jotun the German Basf However, in fact, it turned out that most of these structures either continued to work without any changes, or changed owners. At the same time, Russian enterprises solved problems with the purchase of foreign chemical components by reorienting to Asian imports and switching to domestic materials.^[3]

2022

Reduction of enamel market volume by 13.4% to 95.3 thousand tons

The volume of the Russian enamel market in 2022 amounted to 95.3 thousand tons, which is 13.4% less than a year earlier. Sales decreased after an increase of 1.9% in 2021 and 6.7% in 2020. This is evidenced by the data of the marketing agency "GuideMarket," which were released in August 2023.

According to analysts, the Russian enamel market at the end of 2022 showed a decline due to several unfavorable economic and political events. Among them are the withdrawal from the Russian market of some large foreign enamel companies, which previously occupied a significant market share (approximately 30%). Also, the dynamics of the market was influenced by anti-Russian sanctions introduced in the spring and summer of 2022, which limited the supply of components for paint and varnish raw materials to Russia.

In previous years, from 2018 to 2021, there was a gradual growth in the market volume, reaching a maximum value of 110.1 thousand tons in 2021.

It is noted that economic instability caused by the aggravation of the geopolitical situation also affected key consumers of enamel in Russia. According to GuideMarket, in 2022 the volume of enamel consumption per person amounted to 0.66 kg, which is 0.09 kg less than in 2021. The market volume in monetary terms at the end of 2022 was estimated at 12.5 billion rubles.

According to the researchers, despite negative factors, the enamel market in Russia in 2022 remained a promising and dynamic segment of industry. Enamel manufacturers should continue to improve technologies and innovations in production, as well as pay attention to the quality and durability of their products in order to meet the increased demand of consumers for high-quality enamel, experts say.^[4]

Sales growth of 3% to 1.99 million tons

In 2022, 1.99 million tons of paints and varnishes were sold in Russia, which is 3% more than a year earlier. In the period from 2018 to 2022. The market volume grew by 21.8%, according to analysts at BusinesStat. Their data was released in June 2023.

According to experts, in 2022, due to the action of long-term investment projects, sales of paints and varnishes grew, despite the crisis changes in the economy. In anticipation of the shortage and rise in prices, consumers carried out additional purchases of paint and varnish products as a stock.

The Russian paint and varnish market is dominated by domestically produced products. For 2018-2022, the share of imports in the sales structure decreased from 30.5% to 17.5%. This was facilitated by the development of domestic production, measures of state support for the industry, the localization of international production enterprises in the country. In 2022, as part of the sanctions, the European Union introduced a ban on the supply of all types of paints and varnishes to Russia. Along with a decrease in supplies from European countries, imports of paints and varnishes from Turkey, China, as well as Kazakhstan and Belarus increased.

From 2018 to 2022 value imports of paints and varnishes to Russia decreased by 14.9%: from $1.39 billion to $1.18 billion. Import turnover increased only in 2021 (+ 14.6% compared to 2020) as a result of an increase in the average price and natural volume of supplies.

The study also says that in 2021, sales of paints and varnishes against expectations did not decrease after a sharp increase in 2020, but remained at the level of 2020. One reason: the record level of housing commissioning in the country. The volume of housing construction in 2021 amounted to 92.6 million square meters. m, which is almost 13% more than in 2020. Demand for housing spurred preferential mortgage programs.^[5]

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