Demand for Metal Finishing Chemicals to Reach $2.2 Billion in 2013

Demand for metal finishing chemicals in the US is forecast to grow 2.4 percent per year to $2.2 billion in 2013.  While a moderation in prices will restrain increases in market value to some extent, real growth will accelerate, supported by above-average gains in the large transportation equipment market.  In addition, increasingly stringent environmental and worker safety regulations will help increase demand for higher-value and safer alternatives.  However, gains will be limited by continued trends toward the use of plastics, which typically require less finishing, in applications where metals have traditionally been employed. These and other trends, including market share and product segmentation, are presented in Metal Finishing Chemicals, a new study from The Freedonia Group, Inc., a Cleveland-based industry research firm.

Plating chemicals will continue to account for the majority of metal finishing chemical demand -- 56 percent of the total in 2013.  However, plating chemicals, surface cleaners and conversion coatings, which are used widely in established markets, will only post gains comparable to the overall average.  Also restraining demand will be environmental pressures, which have caused some metal finishing firms to adopt chemical recycling processes.  On the other hand, proprietary additives and other chemicals are expected to register slightly above-average growth, benefitting from new product developments.

Through 2013, the transportation equipment market is expected to record the most rapid gains.  Metal finishing chemical consumption in this industry will be boosted by a rebound in transportation equipment production (especially motor vehicles).  In addition, the development of alternatives to chrome plating, in particular for the replacement of hexavalent chromates, will support demand for higher-value metal finishing chemicals.  However, factors that will negatively affect demand include the continuing replacement of metals by plastics in many automotive and other transportation equipment parts.

The electronics and electrical equipment market will remain the second largest major market.  However, growth in this sector will be below-average as manufacturing of these items continues to move offshore.  Additionally, the trend toward smaller, yet more powerful and technologically sophisticated electronic components will restrain demand in volume terms.  Nonetheless, advances will be supported by the use of higher-priced finishing chemicals, including precious metal (gold in particular) plating solutions.

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.