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Home / SPECIAL REPORTS / The future looks bright for the Middle East’s chemical manufacturers

The future looks bright for the Middle East’s chemical manufacturers

by CW Staff on Dec 9, 2017


The Middle Easts chemical suppliers will grow as regional construction activity increases.
The Middle Easts chemical suppliers will grow as regional construction activity increases.

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A report released this November has revealed that the global construction chemicals market is on track to be worth $67.6bn by 2024.

The study, prepared by Hexa Research, also states that the global chemicals market is driven by growing demand from “several end-use industries, comprising residential and non-residential [facilities] and infrastructure”.

The report continues: “A brisk move towards urbanisation, along with escalating focus on infrastructure growth in promising economies will [further] stimulate the demand.”

According to the report, in 2015, the concrete admixtures segment alone contributed more than 64.7% of the global construction chemicals market’s total volume of products, which also includes concrete sealants and adhesives, as well as protective coatings. Meanwhile, the non-residential and infrastructure sectors accounted for more than 60% of total revenue shares in 2015.

Additionally, sealant consumption is also on the rise in the Middle East. The global polyurethane (PU) sealants market is expected to expand at a compound annual growth rate (CAGR) of more than 5% between 2017 and 2021, according to Technavio’s Global Polyurethane Sealants Market 2017-2021 report.

The study claims that among global markets, the PU sealants segment in the Europe, Middle East, and Africa (EMEA) region is growing at “a significant rate”, adding that the trend is being driven due to increased demand “from various end-user industries in countries such as Russia, Turkey, Germany, Italy, and France”.

Hitesh Bhatia, lead analyst at Technavio for additives, adhesives, and sealants research, said that construction activity is helping to increase demand for sealants in the Middle East.

“The [rise] in construction activities in the Middle East is one of the major factors fostering [sealants’] growth in the region,” Bhatia explained.

“The UAE government has provided investors with incentives, which will further attract them to the Middle East. Moreover, large-scale investments in infrastructure projects in the Middle East and Africa (MEA) market [will create] an opportunity for PU sealant manufacturers and consumers during 2017-2021.”

Indeed, the prospects are bright for construction chemical manufacturers in the Middle East, as well as those in other global markets. Among the firms riding this wave is Dow Chemical Company, which this September completed its merger with DuPont. The combined entity is now operating as a holding company named DowDuPont, comprising three divisions – agriculture, materials science, and specialty products.

Calculated based on generally accepted accounting principles (GAAP), DowDuPont recorded a 23% hike in its net sales for the three months to 30 September, 2017, with sales from the safety and construction segment increasing by 6% during the period.

Within DowDuPont’s material science division, the construction chemicals business also achieved sales growth, driven by demand for methyl cellulosics in the EMEA region.

DowDuPont said that pro forma equity earnings for the industrial intermediates and infrastructure segment – a part of its material sciences division – amounted to $41m. The figure is an improvement compared to the pro forma equity loss of $7m in the same period a year ago. “The improvement was driven by the Kuwait joint ventures as a result of higher monoethylene glycol (MEG) pricing,” the company said in a statement.

For the teams behind DowDuPont, 2017 appears to have been a good year. This May, Dow signed an agreement to construct a manufacturing facility to produce polymers for coatings and water-treatment applications in Saudi Arabia. The firm also signed a memorandum of understanding for a feasibility study related to a proposed investment in the company’s performance silicones segment.

Located in Jubail, the coatings facility will, upon completion, supply acrylic-based polymers for industrial and architectural coatings and water-treatment and detergent applications in the kingdom.

Meanwhile, the proposed silicones investment will include the construction of a siloxanes and silicones complex geared towards markets and industries such as automotive, high-performance building and construction, and solar energy.

Dow’s contracts in the kingdom include a deal for the supply of silicone sealants for the structural glazing façade of Jeddah Tower, the ongoing project which, upon completion, will see Saudi Arabia housing the world’s tallest tower at 1km.

Like all structures, the world’s next tallest building will need the right chemical composition to come together, and Dow’s performance this year proves that the growth of chemical manufacturers will only boost both architectural and economic growth in the Middle East.



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