Published September 2018
Epoxy resins are thermosetting resins, meaning that they do not develop useful properties until they are reacted with suitable cross-linking agents. There is a limited amount of high-molecular-weight epoxy resin that forms useful properties as a thermoplastic coating. Epoxy resins can be used in various forms, including as liquids (liquid epoxy resins [LERs]) and solids, as well as dissolved in solvents including water and organic solvents. Production and consumption data are usually expressed as a combination of all resin forms from basic producers like Olin, Hexion, and Huntsman.
Producers of epoxies also sell basic forms of resin (mainly LER) to customers such as coatings producers that modify them to achieve certain properties. The leading market for epoxies is coatings, which account for 45–50% of consumption. Other large markets are electrical/electronics, adhesives, construction, and composites. About 80% of the epoxies are considered commodities; the other 20% are specialties (e.g., industrial adhesives for automotive and composites for aerospace and wind turbine blades).
The following pie chart shows world consumption of epoxy resins:
Growth markets for epoxies include
- Composites, produced by the carbon fiber reinforcement of plastics like epoxy resins (CFRP epoxies). The principal uses are in aircraft, wind turbine blades, sporting goods, pressure vessels, and automotive. These superstrong, lightweight CFRP epoxies are being used to make part of the structure of Boeing 787 Dreamliners and Airbus A350 models, as well as other aircraft. Use in offshore wind turbine blades is expected to grow by 10% or more in the next few years. The pressure vessel market is expanding as a result of greater use of compressed natural gas for vehicles. In automotive, BMW now uses CFRP epoxy for some parts used in the 3 and 7 series models, and adoption by other brands is expected in the near future
- Adhesives, which are being used in greater quantities in automotive assembly operations to bond dissimilar materials of construction (steel, plastics, aluminum, etc.), which are difficult to bond with mechanical fasteners
The three leading Western producers of epoxy resins are Olin, Hexion, and Huntsman, which have dominant positions in North America and Western Europe, but much less interest in Asia. Starting in 2010, there was considerable expansion of capacity in China and South Korea, which led to falling prices and poor profitability, especially in the commodity-based resins business. The commodity resins business has been in chronic oversupply for most of the last five years. As a result, Dow Chemical divested its base epoxy interests in mid-2015. Also, Huntsman and Hexion recently closed some of their plants in Europe and North America.
The specialty epoxies business is currently the more attractive portion of the industry since there are higher barriers to entry and requirements like formulating skills and technical support are highly valued. EBITD for base resins have tended to be in the 5–10% range, while those for high-performance specialty resins have been over 15%.
Global epoxy resin demand is forecast to grow at an average annual rate of almost 4% during 2016–21. The fastest-growing markets will continue to be in Asia.