Global Forecast: Siloxane Based Materials are Rising in Price

Jun 20th, 2017

Sealants are consolidating materials widely applied in the construction sector. They make the building or its parts impermeable to the wind, waterproof, adherent, heat-saving, etc. Regarding the application area, sealants have various chemical composition and functions. Taking into considerations their wide applicability, the number of sealant suppliers is only growing.

The price for sealants that include siloxane is growing up. This is due to the fact that some leading global siloxane producers have changed their manufacturing and marketing strategies. Waker – a key siloxane producer – has raised the price by 10-20% on this material and siloxane-based products.  Siloxane is a raw stuff for silicone sealants and adhesives. Another worldwide supplier Momentive is reducing siloxane production to the minimum as it has started manufacturing of NXT sealant for the tire industry. A solid evidence of Momentive decision is the shutdown of a siloxane plant in Europe, retrenchment and the launch of a new NXT sealant facility. Momentive has reversed its production policy relying on the automotive market. As an NXT sealant supplier, Momentive has invested nearly $30 billion in the new production.

According to some analysts, the decision of these giants to such production change-over is caused by shaky marginality at the silicone sealant market. Market oversaturation has led to the situation that more producers offer cheap prices for these materials. Consequently, major producers experience frequent pricing pressure and are forced to reduce the production considerably.

Currently, China is a global leader in the adhesive and sealant market. It produces over 17% of all products. Moreover, the production capacity of China is annually growing at 6-7%. The U.S. follows China with the annual growth at 2-4%.  The third major sealant producer is Europe.

The experts predict that global market leadership will belong to renewed hybrid and polyurethane sealants. Improved sealants will soon replace mechanical joining methods. All in all, the price for siloxane will keep growing due to the lack of this material and correspondingly, most European producers will raise the price for siloxane-based sealants.