IAL Consultants is pleased to announce the recent publication of the 17th edition of its report on the markets for Polyurethane Chemicals and Products in Europe, Middle East and Africa.
This new study updates and expands upon the information included in our previous study published in 2023. The information contained within this report is based upon an extensive programme of interviews throughout the industry. The report contains both PU product production and raw material consumption figures, with 2023 as the base year and market forecasts provided to 2028.
The data is also available separately in a database format for subscribers, enabling the manipulation and output of data.
Market Overview
The market for polyurethanes has experienced several challenging years in the EMEA region. Production declined by 6.4% in 2020 but recovered somewhat in 2021 with 3.1% growth. Economic and political issues, not least the Russia-Ukraine conflict, caused a decline in production in 2022. Overall, 2023 was a better year than 2022, but there was still a drop of 2.9%. IAL is anticipating a relatively static year in 2024, before a return to low growth in 2025.
Pre-pandemic production is not expected to be regained until the end of the forecast period, in 2027 or even 2028. Growth rates should return to 2-3% p.a. by 2025, if the situation does not worsen from the time of publication. There are continuing uncertainties across the global economy, and unforeseen events such as the Israel-Gaza conflict and Red Sea attacks, which are destabilising the Levant region and causing obstacles to trade via the Suez Canal.
Flexible foam leapfrogged rigid foam once again to become the largest product category for PU production. Both product types together represent 66% of the overall market. Binders account for the smallest share of PU production at just 3.6%.
The total production of polyurethane products in the EMEA region was 5.94 million tonnes in 2023, representing a decline of 2.9% compared to the previous year. There were many contributing factors, including low demand, the energy crisis, inflation, high raw material costs, rising interest rates, and weakening confidence. The market is expected to remain stable in 2024, then pick up from 2025 onwards.
All regions experienced a decline in 2023, with the exception of Eastern Europe and the Middle East. The poorest performance came in Western Europe, with a decline in PU output of 5.4%. The fallout from the Russia-Ukraine conflict also affected Central Europe. The decline in production in Africa came amid much regional uncertainty, and only a slow recovery is expected.
Flexible Foam
Total EMEA production of polyurethane flexible foam was 1.98 million tonnes in 2023, a decrease of 1.7% compared to the previous year. After a small rebound in 2022, flexible foam production contracted slightly in 2023 amid falling consumer demand for comfort foams, previous overstocking activity, and despite an uptick in automotive production.
The flexible foam market in EMEA is relatively mature. Western Europe is the largest producer by some margin, followed by Eastern and then Central Europe, with the latter two regions’ furniture industries being very important (notably Poland and Türkiye). Africa and the Middle East also produce significant quantities of flexible slabstock since the production process is relatively simple.
Among the Central and Eastern Europe countries, the picture was mixed in 2023. Poland and Romania saw the largest declines, while there was growth in Türkiye and Russia. All countries in Western Europe with the exception of Ireland saw a decline in 2023, but the situation was mixed.
Among the MEA countries/regions there was a varied scenario, with better growth in the Middle East and a decline in some of Africa. The comfort segment of flexible foam (particularly mattresses) struggled in 2023, partly because companies had previously overstocked and partly because many consumers brought forward their discretionary purchases during the pandemic. The technical foam segments performed somewhat better.
Rigid Foam
PU rigid foam production in EMEA declined by 3.8% in 2023 to reach 1.95 million tonnes. Rigid foam was the second largest polyurethane segment in 2023, just behind flexible foam. Western Europe accounts for the largest share of rigid foam production in the region, followed by Eastern Europe. Africa is the smallest producing region.
By sub-region, there was some growth in Africa, Eastern Europe and the Middle East, driven primarily by the construction and insulation sectors. Volumes of rigid foam saw an upward trend in 2023, with spray foam and metal panels displaying the strongest growth.
CASE Applications
The EMEA region produced 840,000 tonnes of polyurethane coatings in 2023, representing a decrease of 2.5% compared to the previous year. The biggest end-use categories in the region for PU coatings are wood and furniture coatings, industrial coatings, and maintenance coatings. Transport is also a large sector if all uses, such as auto OEM, auto refinish, commercial vehicle and marine coatings, are taken together. The coatings market for automotive applications experienced growth in 2023 after several difficult years.
The EMEA region produced 405,000 tonnes of polyurethane adhesives and sealants in 2023, representing a decline of 2.3% compared to the previous year. Adhesives represent 73% of production, and sealants the remaining 27%. Within EMEA, the majority of production takes place in Western Europe, with rather small quantities produced elsewhere. Germany and Italy are the largest producers. The decline in 2023 masks varying fortunes among the regions that make up EMEA; there was a 1% decline in Eastern Europe and steeper declines in Central and Western Europe, due to the rise in raw material prices.
Production of polyurethane elastomers in the EMEA region stood at approximately 553,300 tonnes in 2023, which reflects a decrease of 4% compared to 2022. The market is expected to remain stable in 2024, then pick up from 2025 onwards.
Most production still takes place in Western Europe, with 60% share, followed by Eastern Europe. In 2023, polyurethane elastomer production in Central and Eastern Europe declined due to high costs, lower demand, and competition from cheap imports. The Middle East and Africa saw a 2.9% increase, while Western Europe produced 334,000 tonnes, with TPU and cast elastomers being the largest categories.
Footwear elastomers represent by far the largest end-use segment, at 200,600 tonnes of production, followed by TPU and cast elastomers.
Binders
Production of polyurethane binders in the EMEA region declined by 5.4% in 2023. There were steeper declines in Western Europe and Central Europe, while Eastern Europe saw just a small decrease. Africa was static, and there was growth in the Middle East to match the growing construction activity.
The largest product segment is forest product binders, which are used to produce wood-based panels such as OSB. Smaller quantities are produced for rubber crumb, foundry core and assorted other binder applications.
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The data in this eight-volume report include raw material consumption by product type, by region, by country and by major end-use industry. The Raw Materials volume contains comprehensive supply and demand data for all the major polyurethane raw material types. The Major End-Use Markets volume contains an overview of the major markets for PU products and a summary of trends and drivers.
The report is available for the following prices:
For more details, please contact:
Mrs Cathy Galbraith
IAL Consultants
CP House, 97-107 Uxbridge Road
Ealing
London W5 5TL
Telephone: +44 (0) 20 88 32 77 80
Fax: +44 (0) 20 85 66 49 31
Email: cgalbraith@brggroup.com
Or visit our website: www.ialconsultants.com
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