Construction Adhesives Market – Growth, Trends, COVID-19 Impact, and Forecast (2022 - 2027)

Market Overview

The market for construction adhesives market size was estimated at USD 7.5 billion in 2020, and the market is expected to witness a CAGR of more than 6% during the forecast period (2021-2026).

The outbreak of COVID-19 is likely to bring several short-term and long-term consequences in the construction industry, which is likely to affect the demand for construction adhesives and sealants. According to the Associated General Contractors of America (AGC), there may be disruptions to work or canceled projects, and the demand may be potentially less for “non-essential” projects, like offices, entertainment, and sports facilities. Due to the shutdown of such projects and other construction activities, the demand for construction adhesives tends to constrain.

• In the short term, one of the major factors driving the market studied is the increase in housing and construction projects in emerging countries. For instance, Singapore witnessed positive growth in 2019, and the investments in the construction sector are expected to increase over the next few years. In 2020, the total construction demand, which is the value of construction contracts to be awarded, is likely to range between ~USD 28 billion and ~USD 33 billion. Such increase in the construction contracts is majorly due to the allocation of various public sector building projects, such as public housing, private sector projects, etc.
• The rapid growth in the construction sector of various emerging economies such as South Korea, Brazil, Indonesia, Argentina, South Africa, Mexico, Poland, Turkey, Egypt, Iran, and Nigeria, where the growth of projects is expected to be significantly high in construction graph, leads the demand of construction adhesives.
• However, stringent environmental regulations related to emissions are likely to restrain the growth of the market.
• Increasing demand for bio-based and hybrid adhesives in the construction sector is estimated to create opportunities for the market in the future.
• Asia-Pacific dominated is witnessing the highest growth rate during the forecast period.

Scope of the Report

Construction adhesives are usually those kinds of adhesives used for roofing, waterproofing, cladding, carpet laying, and others insulation applications during construction activities. The market is segmented on the basis of type, application, and geography. By type, the market is segmented into Water-based, Solvent-based, Hot Melt, Reactive, and Other Types. By application, the market is segmented into Commercial, Residential, Infrastructure, and Industrial and Institutional. The report also covers the market size and forecasts for the Construction Adhesives Market in 15 countries across major regions. For each segment, the market sizing and forecasts have been done on the basis of revenue (USD million).

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Key Market Trends

The Residential Segment to Dominate the Market

• In residential construction, adhesives have several application areas like carpet laying, laminating countertops, installing flooring, wallpapering, etc. The usage of adhesives can reduce the usage of screws and help in weatherproofing the house.
• Residential construction across the globe has been witnessing significant growth over the past few years owing to factors like population growth, migration from rural areas to service sector clusters, and the growing trend of nuclear families, among others. Besides, decreasing land to population ratio and the growing trend of constructing high-rise residential buildings and townships have been driving the application of adhesives and sealants in the residential construction segment across the globe.
• In the recent past, the highest growth rate regarding residential construction was expected to be registered in the Asia-Pacific region, owing to the expanding housing construction market in China and India. Asia-Pacific has the largest low-cost housing construction segment, led by China, India, and various Southeast Asian countries. However, with most of the Asia-Pacific countries being severely affected by COVID-19 on a large scale, the growth is expected to notably slower down in the short run.
• Globally, there has been a significant undersupply to meet the demand for housing. This presented a major opportunity for the investors and developers to embrace the alternative methods of construction and new partnerships in order to bring forward development. For instance:
• In China, residential investment grew by about 13.9% during the first eleven months of 2019, reaching CNY 9,707.1 billion. The area under residential construction during the period was recorded to have reached 6,276.73 million square meters, indicating a 10.1% growth.
• In India, in November 2019, the Union Cabinet approved to set up an Alternative Investment Fund (AIF) of INR 25,000 crore (USD 3.58 billion) to revive about 1,600 delayed housing projects across the top cities in the country. Besides that, Puravankara Ltd planned an investment of about INR 850 crore (USD 121.6 million) for the development of three ultra-luxury residential projects in Chennai, Bengaluru, and Mumbai, over the next four years.
• In Canada, various government projects, including the Affordable Housing Initiative (AHI), New Building Canada Plan (NBCP), and Made in Canada, have been supporting the expansion of the sector.
• While residential construction growth was prominent through 2019 in regions such as Asia-Pacific, North America, and the Middle East, the COVID-19 pandemic is expected to severely hit residential construction growth at least over the next two years. As COVID-19 has been severely increasing the fatality rate across the globe, housing and new residential construction are likely to be moderate during the foreseeable future.

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