Market Overview
| Study Period | 2017 - 2028 |
|---|---|
| Base Year For Estimation | 2023 |
| Forecast Data Period | 2024 - 2028 |
| Market Size (2024) | USD 600.35 Million |
| Market Size (2028) | USD 737.35 Million |
| Growth Rate (2024 - 2028) | 5.27% CAGR |
| Market Concentration | Medium |
Major Players
*Disclaimer: Major Players sorted in no particular order Image © Mordor Intelligence. Reuse requires attribution under CC BY 4.0. |
|
Australia Adhesives Market Analysis by Mordor Intelligence
The Australia Adhesives Market size is estimated at 600.35 million USD in 2024, and is expected to reach 737.35 million USD by 2028, growing at a CAGR of 5.27% during the forecast period (2024-2028).
The Australian adhesives industry is experiencing significant transformation driven by evolving end-user requirements and sustainability initiatives. The construction sector, contributing approximately 9% to the national GDP, remains a crucial growth driver for construction adhesives consumption. The industry has witnessed a notable shift in raw material sourcing and pricing dynamics, with construction approvals outpacing completions due to supply chain constraints and increased material costs. This has prompted manufacturers to focus on developing cost-effective bonding agents while maintaining performance standards.
Technological advancements and environmental considerations are reshaping product development strategies in the adhesives sector. Manufacturers are increasingly investing in research and development to create environmentally friendly industrial adhesives that comply with Australia's stringent environmental regulations. The industry has witnessed a particular focus on developing solvent-free and low-VOC formulations, especially in construction and packaging adhesives applications. This trend aligns with the government's sustainability goals and growing consumer awareness about environmental impact.
The packaging industry continues to be a significant consumer of adhesives, driven by evolving retail patterns and e-commerce growth. The Australian packaging market is projected to reach 71.5 million tons by 2028, indicating substantial growth potential for adhesive manufacturers. The industry has seen increased demand for specialized packaging adhesives that can meet the diverse requirements of modern packaging applications, particularly in food and beverage packaging where safety and durability are paramount.
The furniture and woodworking sector has emerged as a notable growth area, particularly in the DIY segment. The shift toward online retail channels has been remarkable, with the share of online furniture sales increasing from 7% to 15%, indicating changing consumer preferences and distribution patterns. This trend has led to increased demand for user-friendly adhesive solutions suitable for DIY applications, prompting manufacturers to develop products that combine ease of use with professional-grade performance. The per capita expenditure on furniture has reached USD 382, reflecting growing consumer investment in home improvement and furnishing projects.
Australia Adhesives Market Trends and Insights
Advancement in technology of plastic recyclability is likely to play a vital role to the packaging industry
- Packaging is one of the fast-growing industries in terms of design and technology for protecting and enhancing products. The packaging industry in Australia is majorly driven by the rapid growth of the food and beverages industry in recent years. The agri-food industry is the most promising sector in Australia. In today's competitive market of FMCG, it has become inevitable for companies to use attractive packaging and bring innovation to their packaging to stand out from their competitors and maintain their brand image in the market. This will likely encourage the use of packaging adhesives in the market.
- Due to the COVID-19 pandemic, the country-wide lockdowns and temporary shutdown of manufacturing facilities caused several issues, including supply chain disruptions and imports and exports trade. As a result, the country's packaging production declined by 6% in 2020 compared to the previous year, significantly affecting the market. Packaging production is majorly driven by plastic in the country, accounting for around 80% of the packaging produced, at 45.5 million tons, in 2021. With the advancement of plastic recyclability, the plastic segment is likely to maintain its CAGR of around 3.29% during the projected period.
- The growth of the packaging industry in Australia is significantly concerned due to the growing demand for fresh food domestically. Furthermore, the growing interest in public health issues during the post-pandemic period, along with the emerging e-commerce activities across the nation, is likely to continue the growth of the food processing industry, which will further thrive the packaging demand in the upcoming years.
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Infrastructure segment is likely to dominate the construction industry
- The Australian construction industry is projected to register a CAGR of about 3.98% during the forecast period from 2022 to 2028. The Australian building and construction outlook is significantly brighter than projected, yet, the recovery remains uneven as the pandemic continues to weigh on particular industry sectors and areas. Some areas of building and construction had significant growth in 2021, while others have seen recession and depression. Australian construction adhesives and sealants are projected to register a CAGR of about 3.83% in terms of volume and 5.77% in terms of value during the forecast period (2022 - 2028).
- Although Australian residential construction showed degrowth before the COVID-19 pandemic, the industry was largely focused on the repairs and renovations side, specifically during the years 2018-19. The industry has spent about USD 2.1 billion. Moreover, the government has also introduced the "HomeBuilder" scheme with an investment of AUD 680 million in the wake of the COVID-19 pandemic; as a result of this scheme, the renovation rate had been increased by 14% in 2021 in comparison to that of 2020. Moreover, the non-residential sector and engineering constructions are enjoying stable growth due to large-scale construction work being done by the Australian government in the eastern states.
- Furthermore, the infrastructure plan, which may invest USD 100 billion over the next ten years from 2021, is projected to fuel the demand for adhesives and sealants in the country during the forecast period. According to the industry and skill committee in Australia, the construction sector is expected to grow by more than 2.4% in the next five years from 2021. These factors tend to increase the demand for adhesives and sealants in the country.
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OTHER KEY INDUSTRY TRENDS COVERED IN THE REPORT
- Growing demand for helicopters and lightweight aircraft is likely to continue the growth of the industry
- Over 50% of footwear demand in Australia depends on imports
- Import dependency will likely suppress the industry size in Australia
- Emergence of e-commerce industry will propel the industry growth
Segment Analysis: End User Industry
Packaging Segment in Australia Adhesives Market
The packaging segment dominates the Australian adhesives market, commanding approximately 32% market share in 2024. This significant market position is primarily driven by the segment's widespread applications, including labels, tapes, carton sealing, and joining operations across various industries. The growth in e-commerce activities and increasing demand for fresh food packaging domestically have substantially boosted the demand for packaging adhesives. The segment's strength is further reinforced by Australia's focus on sustainable packaging initiatives, particularly the 2025 National Packaging Targets, which aim to convert 100% of packaging materials into reusable, recyclable, and compostable materials, creating new opportunities for innovative adhesive solutions in sustainable packaging applications.
Footwear & Leather Segment in Australia Adhesives Market
The footwear and leather segment is emerging as the fastest-growing segment in the Australian adhesives market, projected to grow at approximately 16% during 2024-2029. This remarkable growth is primarily attributed to the rising domestic footwear production and increasing adoption of water-borne adhesives in the sector. The segment's growth is further supported by the increasing awareness of fitness across the country, driving demand for athletic footwear, with the athletic footwear market expected to reach significant milestones in the coming years. Additionally, the implementation of environmental regulations, particularly those issued by Good Environmental Choice Australia (GECA) under Australia's Ecolabel Program, is driving the adoption of low-VOC adhesives in footwear manufacturing.
Remaining Segments in End User Industry
The Australian adhesives market encompasses several other significant segments, including building and construction, healthcare, woodworking and joinery, aerospace, and automotive industries. The building and construction segment maintains a strong presence due to ongoing infrastructure developments and government support schemes. The healthcare segment is driven by the country's growing medical device industry and aging population. The woodworking and joinery segment benefits from the rising DIY furniture market and increasing per capita expenditure on furniture. The aerospace segment is supported by the country's significant presence in aircraft maintenance and repair operations, while the automotive segment primarily serves the aftermarket and maintenance sectors. Notably, automotive adhesives play a crucial role in enhancing vehicle performance and safety.
Segment Analysis: Technology
Water-borne Segment in Australian Adhesives Market
Water-borne adhesives dominate the Australian adhesives market, commanding approximately 35% market share in 2024. These adhesives are formulated as polymeric dispersions or emulsions in an aqueous phase, with dispersed polymer particles typically ranging from 50-300 nm in diameter. The segment's prominence is particularly evident in the woodworking and joinery industry, where it captures nearly 47% of the technology share. Water-borne adhesives are preferred by manufacturers due to their cost-effectiveness, ease of cleaning, and versatility in bonding various substrates. The segment's strong position is further reinforced by its widespread applications across furniture manufacturing, automotive, building and construction, and footwear industries.
UV Cured Segment in Australian Adhesives Market
The UV cured adhesives segment is emerging as the fastest-growing technology in the Australian adhesives market, projected to grow at approximately 7% during 2024-2029. This growth is primarily driven by the segment's unique advantages, including rapid curing capabilities, energy efficiency, and enhanced manufacturing productivity. UV cured adhesives are particularly gaining traction in high-precision industries such as medical devices manufacturing, aerospace, and electronics, where they provide superior control over manufacturing processes. The technology's ability to cure rapidly while contributing to energy savings makes it increasingly attractive to manufacturers looking to optimize their production processes and improve operational efficiency.
Remaining Segments in Technology
The other significant technology segments in the Australian adhesives market include hot melt adhesives, reactive adhesives, and solvent-borne adhesives. Hot melt adhesives are gaining prominence in assembly line operations and packaging applications due to their quick-setting properties and solvent-free formulations. Reactive adhesives are particularly valued in high-performance applications where chemical resistance and structural bonding are critical. Solvent-borne adhesives, while facing some regulatory pressure due to VOC content, continue to maintain their position in specific applications where fast drying and strong initial tack are essential requirements.
Segment Analysis: Resin
Polyurethane Segment in Australia Adhesives Market
Polyurethane adhesives dominate the Australian adhesives market, holding approximately 23% share of the total market value in 2024. These adhesives are widely preferred across building and construction, woodworking, and automotive industries due to their versatile properties, including strong bond strength and excellent durability. The segment's prominence is particularly notable in exterior applications where weather resistance and structural integrity are crucial. Polyurethane adhesives offer superior performance characteristics such as high flexibility, excellent chemical resistance, and the ability to bond dissimilar substrates, making them indispensable in modern construction and industrial applications. The building and construction industry, together with woodworking applications, accounts for nearly 80% of the demand for polyurethane adhesives in Australia, driven by their extensive use in structural bonding, flooring systems, and panel lamination.
Epoxy Segment in Australia Adhesives Market
The epoxy adhesives segment is experiencing robust growth in the Australian market, projected to expand at approximately 7% in value terms during 2024-2029. This growth is primarily driven by increasing demand from the aerospace and construction sectors, where epoxy adhesives are preferred for their exceptional bonding strength and versatility. The segment's growth is further supported by technological advancements in epoxy formulations that offer improved curing times and enhanced performance characteristics. Epoxy adhesives are particularly gaining traction in high-performance applications due to their strong bond strength of 35-41 N/mm2, making them increasingly popular as replacements for traditional fasteners in various industrial applications. The aerospace industry's preference for epoxy adhesives in structural component bonding, coupled with the growing construction sector, continues to fuel the segment's expansion.
Remaining Segments in Resin Segmentation
The Australian adhesives market features several other significant resin segments, including acrylic, VAE/EVA, silicone, and cyanoacrylate adhesives, each serving specific application needs across various industries. Acrylic adhesives are particularly valued for their quick curing properties and strong bonds with polar substrates, finding extensive use in assembly line operations. VAE/EVA adhesives excel in packaging applications, offering excellent adherence to both polar and non-polar substrates. Silicone adhesives have carved out a niche in applications requiring high temperature resistance and flexibility, while cyanoacrylate adhesives are preferred for their rapid bonding capabilities in electronics and medical device manufacturing. These segments collectively contribute to the market's diversity, offering solutions for specific industry requirements and applications. Notably, medical adhesives are crucial in healthcare applications, providing reliable bonding solutions for medical devices.
Competitive Landscape
Top Companies in Australia Adhesives Market
The leading adhesive manufacturers in Australia are focusing on multiple strategic initiatives to maintain and expand their market presence. Product innovation remains a key focus area, with companies developing sustainable and high-performance adhesives tailored for specific industry applications like packaging, construction, and automotive. Operational agility has become crucial as companies invest in expanding their manufacturing capabilities and distribution networks across the country. Strategic partnerships, particularly with chemical manufacturers, are being pursued to ensure a stable raw material supply and develop eco-friendly solutions. Companies are also emphasizing research and development to create products with lower VOC content and improved performance characteristics. The expansion strategies include strengthening local distribution channels, acquiring regional players, and establishing technical support centers to provide customized solutions.
Consolidated Market Led By Global Players
The Australian adhesive industry exhibits a consolidated structure dominated by large multinational corporations with diverse product portfolios. These global players leverage their extensive research capabilities, established brand reputation, and wide distribution networks to maintain their market positions. Local players, while present in the market, primarily operate in specific niches or serve regional customers with specialized requirements. The market's consolidated nature is evident from the significant market share held by the top five companies, including Arkema Group, Henkel AG & Co. KGaA, DuluxGroup Ltd, 3M, and Avery Dennison Corporation.
The market has witnessed several strategic acquisitions and partnerships aimed at expanding product portfolios and geographical reach. Global companies have shown particular interest in acquiring local manufacturers to strengthen their presence in the Australian market and gain access to established distribution networks. The trend of consolidation is expected to continue as companies seek to enhance their technological capabilities and achieve economies of scale. Companies are also forming strategic alliances with raw material suppliers and end-user industries to ensure sustainable growth and market stability.
Innovation and Sustainability Drive Future Success
For incumbent companies to maintain and increase their market share, focusing on sustainable product development and technological innovation will be crucial. Companies need to invest in developing eco-friendly specialty adhesives solutions that comply with evolving environmental regulations while maintaining high-performance standards. Building strong relationships with key end-user industries through technical support and customized solutions will be essential. Expanding distribution networks, particularly in high-growth regions, and offering comprehensive product portfolios that cater to diverse industry requirements will help maintain competitive advantages.
New entrants and smaller players can gain ground by focusing on niche markets and developing specialized products for specific applications. Establishing strong technical capabilities and offering innovative solutions for emerging applications in sectors like electronics and renewable energy can provide growth opportunities. Companies must also consider the increasing emphasis on environmental sustainability and regulatory compliance while developing their product strategies. Building strategic partnerships with established players or end-users can help overcome entry barriers and gain market access. Additionally, investing in local manufacturing capabilities and technical support services can help build customer trust and market presence.
Australia Adhesives Industry Leaders
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3M
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Arkema Group
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AVERY DENNISON CORPORATION
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DuluxGroup Ltd.
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Henkel AG & Co. KGaA
- *Disclaimer: Major Players sorted in no particular order
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Recent Industry Developments
- December 2021: Under the Nuplaviva brand, Arkema introduced a new range of disposable hygiene adhesive solutions formulated with bio-based renewable content.
- October 2021: 3M introduced a new generation of acrylic adhesives, including 3M Scotch-Weld Low Odor Acrylic Adhesive 8700NS Series, 3M Scotch-Weld Flexible Acrylic Adhesive 8600NS Series, and 3M Scotch-Weld Nylon Bonder Structural Adhesive DP8910NS.
- September 2021: Henkel launched its newly developed solvent-free and zero-VOC adhesive range for rubber lining.
Australia Adhesives Market Report Scope
Aerospace, Automotive, Building and Construction, Footwear and Leather, Healthcare, Packaging, Woodworking and Joinery are covered as segments by End User Industry. Hot Melt, Reactive, Solvent-borne, UV Cured Adhesives, Water-borne are covered as segments by Technology. Acrylic, Cyanoacrylate, Epoxy, Polyurethane, Silicone, VAE/EVA are covered as segments by Resin.
End User Industry
| Aerospace |
| Automotive |
| Building and Construction |
| Footwear and Leather |
| Healthcare |
| Packaging |
| Woodworking and Joinery |
| Other End-user Industries |
Technology
| Hot Melt |
| Reactive |
| Solvent-borne |
| UV Cured Adhesives |
| Water-borne |
Resin
| Acrylic |
| Cyanoacrylate |
| Epoxy |
| Polyurethane |
| Silicone |
| VAE/EVA |
| Other Resins |
| End User Industry | Aerospace |
| Automotive | |
| Building and Construction | |
| Footwear and Leather | |
| Healthcare | |
| Packaging | |
| Woodworking and Joinery | |
| Other End-user Industries | |
| Technology | Hot Melt |
| Reactive | |
| Solvent-borne | |
| UV Cured Adhesives | |
| Water-borne | |
| Resin | Acrylic |
| Cyanoacrylate | |
| Epoxy | |
| Polyurethane | |
| Silicone | |
| VAE/EVA | |
| Other Resins |
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Market Definition
- End-user Industry - Building & Construction, Packaging, Automotive, Aerospace, Woodworking & Joinery, Footwear & Leather, Healthcare, and Others are the end-user industries considered under the adhesives market.
- Product - All adhesive products are considered in the market studied
- Resin - Under the scope of the study, resins like Polyurethane, Epoxy, Acrylic, Cyanoacrylate, VAE/EVA, and Silicone are considered
- Technology - For the purpose of this study, Water-borne, Solvent-borne, Reactive, Hot Melt, and UV Cured adhesive technologies are taken into consideration.
| Keyword | Definition |
|---|---|
| Hot-melt Adhesive | Hot melt adhesives are generally 100% solid formulations, based on thermoplastic polymers. They are solid at room temperature and are activated upon heating above their softening point, at which stage they are liquid, and hence, can be processed. |
| Reactive Adhesive | A reactive adhesive is made up of monomers that react in the adhesive curing process and do not evaporate from the film during use. Instead, these volatile components become chemically incorporated into the adhesive. |
| Solvent-borne Adhesive | Solvent-borne adhesives are mixtures of solvents and thermoplastic, or slightly cross-linked polymers, such as polychloroprene, polyurethane, acrylic, silicone, and natural and synthetic rubbers (elastomers). |
| Water-borne Adhesive | Water-borne adhesives use water as a carrier or diluting medium to disperse a resin. They are set by allowing the water to evaporate or be absorbed by the substrate. These adhesives are compounded with water as a diluent, rather than a volatile organic solvent. |
| UV Cured Adhesive | UV curing adhesives induce curing and create a permanent bond without heating by using ultraviolet (UV) light or other radiation sources. An aggregation of monomers and oligomers is cured or polymerized by ultraviolet (UV) or visible light in a UV adhesive. Because UV is a radiating energy source, UV adhesives are often referred to as radiation curing or rad-cure adhesives. |
| Heat-resistant Adhesive | Heat-resistant Adhesives refer to those that do not break down under high temperatures. One aspect of a complicated system of circumstances is the adhesive's capacity to withstand disintegration brought on by high temperatures. As the temperature rises, adhesives may liquefy. They can withstand stresses resulting from differing coefficients of expansion and contraction, which might be an additional advantage. |
| Reshoring | Reshoring is the practice of moving commodity production and manufacturing back to the nation where the business was founded. Onshoring, inshoring, and back shoring are further terms used. Offshoring, the practice of producing items abroad to lower labor and manufacturing costs, is the opposite of this. |
| Oleochemicals | Oleochemicals are compounds produced from biological oils or fats. They resemble petrochemicals, which are substances made from petroleum. The oleochemical business is built on the hydrolysis of oils or fats. |
| Nonporous Materials | Nonporous materials are substances that do not permit the passage of liquid or air. Nonporous materials are those that are not porous, such as glass, plastic, metal, and varnished wood. Since no air can get through, less airflow is required to raise these materials, negating the requirement for high airflow. |
| EU-Vietnam Free Trade Agreement | A trade agreement and an investment protection agreement were concluded between the European Union and Vietnam on June 30, 2019. |
| VOC content | Compounds with limited solubility in water and high vapor pressure are known as Volatile Organic Compounds (VOCs). Many VOCs are human-made chemicals that are used and produced in the manufacture of paints, pharmaceuticals, and refrigerants. |
| Emulsion Polymerization | Emulsion polymerization is a method of producing polymers or connected groups of smaller chemical chains known as monomers, in a water solution. The method is often used to make water-based paints, adhesives, and varnishes, in which the water stays with the polymer and is marketed as a liquid product. |
| 2025 National Packaging Targets | In 2018, the Australian Environment Ministry set the following 2025 National Packaging Targets: 100% of the packaging must be reusable, recyclable, or compostable by 2025, 70% of plastic packaging must be recycled or composted by 2025, 50% of average recycled content must be included in packaging by 2025, and problematic and unnecessary single-use plastic packaging must be phased out by 2025. |
| Russian Government’s Import Substitution Policy | The Western sanctions suspended the distribution of several high-tech items to Russia, including those required by the raw material export sectors and the military-industrial complex. In response, the government launched an "import substitution" scheme, appointing a special commission to oversee its implementation in early 2015. |
| Paper Substrate | Paper substrates are paper sheets, reels, or boards with a base weight of up to 400 g/m2 that has not been converted, printed or otherwise altered. |
| Insulation Material | A material that inhibits or blocks heat, sound, or electrical transmission is known as Insulation Material. The variety of insulation materials includes thick fibers like fiberglass, rock and slag wool, cellulose, and natural fibers as well as stiff foam boards and sleek foils. |
| Thermal Shock | A temperature change known as thermal shock generates stress in a material. It commonly results in material breakdown and is especially prevalent in brittle materials like ceramics. When there is a quick temperature change, either from hot to cold or vice versa, this process occurs abruptly. It occurs more frequently in materials with poor heat conductivity and insufficient structural integrity. |
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Research Methodology
Mordor Intelligence follows a four-step methodology in all our reports.
- Step-1: Identify Key Variables: The quantifiable key variables (industry and extraneous) pertaining to the specific product segment and country are selected from a group of relevant variables & factors based on desk research & literature review; along with primary expert inputs. These variables are further confirmed through regression modeling (wherever required).
- Step-2: Build a Market Model: In order to build a robust forecasting methodology, the variables and factors identified in Step-1 are tested against available historical market numbers. Through an iterative process, the variables required for market forecast are set and the model is built on the basis of these variables.
- Step-3: Validate and Finalize: In this important step, all market numbers, variables and analyst calls are validated through an extensive network of primary research experts from the market studied. The respondents are selected across levels and functions to generate a holistic picture of the market studied.
- Step-4: Research Outputs: Syndicated Reports, Custom Consulting Assignments, Databases & Subscription Platforms
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