Negative growth will force European pulp and paper defoamer suppliers to recognise commodity market, says new report
The European market for Pulp and paper defoamers has become commoditised and only those suppliers who quickly recognise and respond to this fact will be successful in this market in the future.
International market research consultant Frost and Sullivan has just published a new analysis, The European Pulp and Paper Defoamer Market.
The study forecasts that the market will continue to be under pressure, which will restrain market growth, resulting in a negative compound annual growth rate of 0.2% over the period 2001 to 2008.
Among the main reasons for this are heightened competition among defoamer suppliers, the increased bargaining power of end-users, low mill capacity additions, improved processing technology requiring less defoamer volumes, and improved defoamer efficacy restraining further volume increases.
In 2008, the market is expected to be worth $91.6 million.
"The European pulp and paper defoamer market has been plagued by declining volumes and intense price-competition," says Ivan Fernandez, author of the study.
"Mills use sophisticated equipment, improved process additives and better manufacturing practices to ensure that less foam is generated which reduces defoamer volumes used. Consolidation within the pulp and paper mill industry has created giant-sized clients for the defoamer supplier.
These large pulp and paper mills enter into high-volume, long-term, sole-supplier contracts which inevitably push the price of defoamers down.
The defoamer supplier, who cannot price aggressively and provide the entire portfolio of products across multiple locations, risks losing key accounts." This study outlines a number of specific strategies to help pulp and paper defoamer companies overcome current industry challenges which include: lower defoamer volumes; price-pressure; product instability and incompatibility and the challenge of tapping emerging markets. The European Pulp and Paper Defoamer Market Report (3906).
