Adhesives & Sealants Headlines / End User News / Info for Construction / Finished Adhesives and Sealants / Info for Transportation / Market Trends

Adhesive Prices Expected to Rise

Adhesive prices are anticipated to rise moderately on the back of rebounding activity in downstream markets and robust growth in external demand drivers, which slightly restricts buyer power, according to a new report from IBISWorld. Adhesives have a buyer power score of 3.3 out of 5, which indicates moderate purchasing power in the market.

“Over the three years to 2014, product prices are anticipated to rise moderately on the back of rebounding activity in downstream markets and robust growth in external demand drivers, slightly restricting buyer power,” said Agiimaa Kruchkin, procurement analyst.

Factors like market share concentration, price driver volatility and supply chain risk are moderate and, hence, on the fence, so their impact on the purchasing environment is negligible. At the same time, low switching costs and low product specialization have provided relief to buyers. Also, the moderate availability of substitutes favors buyers, having supported negotiation power in the three years to 2014.

Starting in 2010, downstream construction, manufacturing and automotive sectors have rebounded strongly on the back of reviving economic activity, fueling demand for a variety of adhesive products. Suppliers have benefited from the recovery in the downstream markets, which encouraged them to raise their prices. Furthermore, external demand drivers provide a proxy for the activity in the downstream markets.

“For instance, the growing value of construction is representative of the use of adhesives in commercial and industrial building projects,” Kruchkin said.

Similarly, new car sales measure the performance in the downstream automotive market, whereas manufacturing capacity utilization represents the activity in the domestic manufacturing sector. As all of these drivers expand, demand for adhesives grows, in turn supporting product price growth.

Purchasing conditions are also largely shaped by input costs. Manufacturers of adhesives require a variety of raw materials, such as petrochemicals. During the three years to 2014, the price of chemicals and allied products is anticipated to grow, lifting purchasing costs for suppliers. Consequently, many vendors in the market have passed down cost increases to buyers in the form of higher prices, limiting buyer power to an extent.

For more information, visit www.ibisworld.com.

Did you enjoy this article? Click here to subscribe to Adhesives & Sealants Industry Magazine.

You must login or register in order to post a comment.

Multimedia

Videos

Image Galleries

ASI April 2014 Photo Gallery

Our April 2014 issue is now available!

Podcasts

ExxonMobil Tackifier Expansion

Dwight Tozer, vice president of ExxonMobil’s Adhesion Industry business, discusses the company’s latest tackifier expansion project with Editor-in-Chief Susan Sutton.

More Podcasts

Adhesives & Sealants Industry Magazine

ASI December 2014 cover

2014 December

The annual Buyers' Guide is here! You won't want to miss this.

Table Of Contents Subscribe

Bonding Plastics

Are you involved in bonding plastics or other difficult-to-bond substrates?
View Results Poll Archive

THE ADHESIVES STORE

handbook-sealant-tech.gif
Handbook of Sealant Technology

The Handbook of Sealant Technology provides an in-depth examination of sealants, reviewing their historical developments and fundamentals, adhesion theories and properties, and today’s wide range of applications.

More Products

ASI 2014 Buyers GuideASI's Buyers' Guide

Annual purchasing resource for equipment used in the manufacture/formulation of adhesives, sealants, pressure sensitives, tapes and labels and for application of finished adhesives. 

STAY CONNECTED

facebook_40px twitter_40  youtube_40pxlinkedin_40 google+ icon ASI 30px

Clear Seas Research

With access to over one million professionals and more than 60 industry-specific publications, Clear Seas Research offers relevant insights from those who know your industry best. Let us customize a market research solution that exceeds your marketing goals.