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The ever-increasing need for high performance adhesives across modern applications drives the growth of hot melt adhesives. Further, the technological advancement in production capabilities and enhancing properties of hot melt adhesives will fuel the growth to a higher rate.
Hot melt adhesives are solvent-free, solid compounds that have negligible or no VOC (volatile organic compound) compared to solvent-based adhesives. The stringent regulations of EPA (Environment Protection Agency) and REACH (Registration, Evaluation, Authorization, and Restriction of Chemicals) in the US and Europe leads the adhesive industry towards a shift of technology from solvent-based adhesives to hot melt adhesives.
The market for hot melt adhesives is driven by changing trends in various end-user segments such as packaging, nonwoven, pressure sensitive applications, etc. This also results in the development of newer and improved application and performance properties. The major hurdle, which is currently to inhibit the growth of the market, is volatility in the prices of raw materials used to manufacture hot melt adhesives.
Asia-Pacific: The Fastest Growing Market
The industry is witnessing high growth on an account of growing demand in the Asia-Pacific region. China is the biggest consumer of hot melt adhesives due to rapid industrialization and infrastructure growth. Japan, South Korea, and Taiwan have high per capita consumption of hot melt adhesives, which is why they are expected to grow at a moderate CAGR.
The packaging, nonwoven, and pressure sensitive industries grow at a high rate in China and India, which drives the demand for hot melt adhesives. There is low control on the consumption of high VOC adhesives in China and India, due to the absence of related government policies.
Market players are keen to expand their product portfolio and offer it to consumers at competitive prices. The major market players are focusing on R&D activities to innovate products under the regulations of EPA and REACH. Other development strategies opted by market players include signing agreements and collaborations to optimize their distribution chain in growing economies.