Mexico’s Economic Growth Fuels Expansion in Local Biocide Market

PARSIPPANY, NJ, May 4, 2011 – Following a year of positive GDP growth, Mexico has seen a favorable expansion in its biocides business. Gaining from increased consumption in key end-use market applications such as paints and coatings, latex emulsions, and cosmetics and toiletries, among others, the biocide market has started recovering after the economic recession and reached nearly 18,000 tonnes in 2010, according to latest research study Specialty Biocides 2011: Mexico Market Analysis and Opportunities from worldwide consulting and research firm Kline & Company.

While water treatment is the leading volume application group for biocides, Mexico’s dynamic biocide market is also being boosted by increased awareness for health, safety, and environmental concerns. Since the recent widespread outbreak of the H1N1 virus in Mexico, stricter hygiene and disinfection practices have been adopted in the consumer and institutional sector, stimulating sales for disinfectants, and sanitizers. Mexico is also the world’s tenth largest car producer and leading companies in the sector, such as Comex, Sherwin Williams, and Akzo Nobel, are establishing new plants, expanding their biocides businesses through the acquisition of minor local players.

Although there is no regulation in Mexico, restricting the usage of certain types of biocides, the long-term outlook favors a shift towards the use of metal-free, formaldehyde-free, and low VOC biocide products. In the case of cooling water treatment, there is a general trend to replace hazardous chlorine gas for safer alternatives.

As the Mexican economy expands, the growing middle-class population is willing to pay extra for higher quality products from key biocide end-use markets. Additionally, large, ongoing governmental infrastructure projects and the mechanization and automation of industrial processes in the manufacturing sector has stimulated demand for specialty biocides.

The perspective for the biocide business will depend heavily on the overall local economic performance. A positive performance of the American economy, Mexico’s major trading partner, would reactivate the Mexican industrial sector, especially in the case of export oriented industries, and provide an impetus to the biocide market. However, “the market, which is currently heavily dependent on biocide imports, will have to strive to overcome complex import administration, which currently makes the registration of biocide actives a lengthy process,” notes Anna Ibbotson, Industry Manager at Kline’s Chemicals/Materials Practice.

Kline estimates that the Mexican specialty biocides market will grow at a compound annual growth rate of 4.9% throughout 2015, with inorganic biocides posting the highest growth.

Kline’s Specialty Biocides 2011: Mexico Market Analysis and Opportunities presents a detailed, independent appraisal of the Mexican market, including current and forecast demand by major biocide product group. Biocide consumption and forecasts are provided for 17 end-use industries, and product selection criteria, distribution channels, and formulation usage is also be assessed.

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