JAPAN COATINGS SECTOR GIVEN A BOOST BY OLYMPICS, BUT COMPANIES ARE NOW LOOKING FOR NEW DEMANDMarch 14th, 2023
In the seven years since the International Olympic Committee (IOC) announced that Tokyo would be the host city of the summer Olympic Games and the Paralympics in the summer of 2020, companies in the paint and coatings sector have enjoyed a steady uptick in demand.
This increase in demand is linked to the construction of venues and facilities for the Games, as well as for connected infrastructure, such as new hotels and transport facilities.
And with the final touches added to the Tokyo Aquatics Centre in early March, the preparations for sporting venues were completed – well ahead of schedule, a bright contrast to the last-minute construction that bedevilled the 2016 summer games in Rio de Janeiro. The problem of course is that because of the Covid 19 pandemic, the IOC and the Tokyo organising committee subsequently announced on March 24 that the games were being postponed until 2021.
Nevertheless, the IOC’s decision that Tokyo would host the 2020 games, announced in September 2013, has already given the Japanese paint and coating sector a welcome shot in the arm, leading to the construction of permanent and temporary sporting venues as well as the renovation of a number of existing facilities. In all, 43 venues were due to hold events between July 24 and August 9 and then again for the Paralympics from August 24 to September 5. They have all been painted. When Tokyo was awarded the Games in 2013, the government set a budget of USD7.3 billion. In December 2019, organisers admitted that had increased to USD12.6 billion – although the respected financial newspaper the Nikkei estimated the real cost was actually closer to USD28 billion. Organisers now believe that delaying the Games by one year will add an extra USD2.7 billion to the grand total.
Those venues are now scheduled to be utilised when the 2020 Olympics finally get under way on July 23, 2021.
Eight projects were complete new builds, including the Tokyo Aquatics Centre, the 12,000-seat Ariake Gymnastics Centre and the crown jewels of the entire occasion, an Olympic stadium that seats 60,000 spectators, which will become the new national stadium once the games are over.
Completed in late 2019, the stadium that will host the majority of track and field events as well as the opening and closing ceremonies cost USD1.4 billion and has attracted attention for its design, which incorporates wood as well as steel and concrete.
While Japan’s paint majors and industry association have declined to say how much of the building budgets for these facilities have been spent on coatings, the construction materials have required the application of advanced coatings, including for weatherproofing and preservation, while polyurethane sealants have been applied to maintain indoor temperatures, acrylic emulsions have been used to preserve exterior metal and concrete, while polyolefin resins were applied to protect electricity and data cables.
Domestic paint firms say they did not experience a “surge” in demand for coatings immediately after Japan won the bidding to host the Olympics, with demand more gradual and spread out over the last three years.
“Most of the development projects including the construction of venues, renovation and related ancillary equipment associated with the Tokyo Olympic Games have been implemented since around 2016 and ran until 2019,” said Masato Ichimura, a spokesman for Osaka-based Nippon Paint Holdings Co Ltd.
Ichimura said construction firms “valued” Nippon Paint’s products, which were used in the new Olympic stadium, but the company declined to specify how much it has earned from Olympic-related projects.
Kansai Paint Co Ltd, similarly declined to provide figures for sales to Olympic venues and infrastructure, although spokesman Kazumi Yura said the company has benefited from an increase in demand for decorative coatings and protective paints.
The industry has clearly experienced a windfall from the games – but the question even before the Olympics were postponed was where companies might next find a new source of demand. And that question has become more acute given the coronavirus crisis.
Interviewed in July 2019 by Japan’s Chemical Daily specialist journal Kunishi Mori, then then chairman of the Japan Paint Manufacturers’ Association, was hopeful that the industry would be able to develop new outlets for its products.
“The construction of Olympic venues is now in its last phase, but we see more demand coming from construction and renovation of hotels, urban redevelopment and transport infrastructure development,” he said.
“Demand for the Olympics is not limited to direct demand for venues and the like, but rather the construction, expansion and renovation of private hotels, redevelopment of city centres and transportation infrastructure,” he said. “There are more indirect demands, such as maintenance, and a questionnaire on demand for the Olympics conducted among our members is not bad. We have high expectations.”
The coronavirus pandemic has sharply altered that optimistic outlook, admits Ichimura of Nippon Paint, who said, “We are currently evaluating the impact of the coronavirus outbreak at this moment. Things are rapidly changing in our business sector, including in automotive coatings, industrial paints and other coatings.”
Given the pessimism that is affecting the paint and coatings sector globally, one positive that companies in Japan hope to still be able to take advantage of when Tokyo does finally host the Olympics next year surrounds the specialist paints that will be showcased to a global audience, such as flame-retardant coatings applied to structures in the athletes’ village and also applicable to skyscrapers.
There will also still be more Olympic-related demand for paints, such as touch-ups and time-sensitive jobs at venues before the delayed games get under way. One will be the application of thermal barrier paints to roads that make up the route of the marathon to protect runners from searing surface heat drawn from Japan’s scorching summer temperatures that can be in the high 30Cs, with thick humidity to boot. Reflective coatings will also be applied later to pavements and plazas where spectators will gather to watch events, with manufacturers hopeful of being able to play up their positive effects and promote international sales.
This article was originally published by the “Polymers Paint Colour Journal” – https://www.polymerspaintcolourjournal.com/