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Wednesday, 01 April 2020
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Markets & companies, Raw materials market

Interview: “The South American market for most applications like paints and coatings is not regulated“

Wednesday, 29 January 2020

Lanxess acquires Brazilian biocide manufacturer Itibanyl Produtos Especiais (IPEL). We spoke with Dr Oliver Kretschik, Vice President Biocides Business Line, about the South American market.

Interview: "The South American market for most applications like paints and coatings is not regulated". Image source: Lazyllama - Fotolia.com
Interview: "The South American market for most applications like paints and coatings is not regulated". Image source: Lazyllama - Fotolia...

How do you rate the market for biocide products in Brazil and South America?

Dr Oliver Kretschik: The South American market for most applications like paints and coatings is not regulated. In terms of portfolio it is not very different from other regions and markets. Most challenging for all players, though, has been a rather long period of political instabilities, which have shown its economical consequences in various countries.

Where do you see further growth potential for your biocide business?

Dr._Oliver_Kretschik_Lanxess_12_2019

Dr Oliver Kretschik, Vice President Biocides Business Line, Lanxess

Kretschik: IPEL’s local customer network will benefit from our combined product portfolio and regulatory expertise. We will have the opportunity to grow in the South American market but we will also be able to strengthen our position in less covered businesses for us, like water treatment and disinfection as the acquisition offers us strategic intermediates and backward integration possibilities. Further, we do see potential to support the African biocide market with the enhanced portfolio.

In how far does the South American biocide market differ from the European one?

Kretschik: That is definitely the amount of regulations we have to comply with in Europe compared to the rather unregulated South American biocide market. As we see more regulations coming up, like K-BPR in Korea, China Green Label etc., IPEL is now in a very comfortable situation. If, one day, the situation changed in Brazil, IPEL could make use of the deep regulatory knowledge Lanxess has already established.

What are the current challenges for biocide producers?

Kretschik: There is a call for green biocides combined with an ever-tighter regulation by the authorities. The situation increasingly reduces the choice of preservatives. At the same time, regulatory costs are increasing, as regulation processes are getting more complicated, take longer and afford more studies. We expect further consolidation in the biocide market in the long run.

This interview is part of a longer feature on Lanxess's acquisition which is part of the January issue of the European Coatings Journal.

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