A tough economy has seen manufacturers push for cheaper, greener alternatives, with global suppliers still getting the lion’s share of the business, writes Annie Dang.
Fasteners and adhesives are not always at the fore- front of manufacturing news, but current economic conditions, including a high dollar and the introduction of a carbon tax, has spurred on demand for bonding options which are not only cheaper and more light-weight, but also more environmental friendly.
According to 3M Industrial Adhesives & Tapes product specialist, Gavin McClelland, adhesive offerings have come a long way over the past few years, with some providing the strength of a mechanical fastener, yet offering flexibility.
“There is an obvious trend to move away from using mechanical fasteners in the marketplace.
For companies wanting to be at the cutting-edge of design and performance, tapes and adhesives offer significant advantages,” McClelland told Manufacturers’ Monthly.
These advantages include reduction in the product’s physical weight, which is essential in aerospace, shipping and automotives manufacturing.
McClelland says low surface energy (LSE) plastics, such as Polypropylene or Polyethylene are becoming more commonly used to decrease weight in automotive, commercial vehicle and aerospace applications, resulting in growing demand by manufacturers for more advanced adhesives technology to bond low surface energy plastics. Other advantages include the development of ‘green’ or environmentally-friendly adhesives. While low emission adhesives have yet to take off, Australians should watch this space; demand is speculated to increase once the carbon tax kicks-in next year.
In Australia, adhesives manufacturers and suppliers make up one of the smaller industries of Australia’s overall chemical sector. According to IBISWorld’s latest Adhesive, Cleaning Product Manufacturing Market Research Report released in July, our overall chemical sector comprises 391 establishments and 3,050 employees (7% of the general chemical manufacturing sector).
Companies which manufacture or formulate chemical products, such as polishes or cleaners, waxes, dry cleaning preparations, oils and adhesives are considered to be part of this industry.
With solid employment figures and forecast economic growth, largely from rising demand in the construction market, the industry has reportedly bucked the trend of poor growth figures over the last five years. The IBISWorld report estimates that revenue for the industry is expected to be $1.97 billion in
2011–12, compared with $1.89 billion five years earlier.
The industry displays high market concentration within certain segments, but an overall low level of market concentration due to the varied nature of the products it manufactures. Smart companies in this sector are fast realising the benefits of consolidating, and investing in R&D to develop new, ‘greener’ offerings.
One company making the move to consolidate activities and grow in emerging markets is industrial adhesives and sealants manufacturer and supplier Henkel, who records 42% of its total adhesives sales within the emerging markets and 53% of its employees in those markets.
Headquartered in Düsseldorf, Germany, the multinational company will grow its consumer and industrial adhesives, sealants and surface treatment business division with the construction of a 150,000 square-metre adhesives factory in China’s Shanghai Chemical Industry Park.
Scheduled to begin production at the end of 2012, the new Henkel factory is said to be the largest adhesives factory in the world, employing 600 people and pulling in an estimated annual production of 428,000 tonnes.
The new facility will reportedly be more environmentally-compatible to meet demands for higher operational efficiency, and lower energy and water usaeage and carbon emissions.