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VINNAPAS® UW 1 FS

From parquet adhesives to automotive body parts – a wide range of applications contain solid resins.

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Sector-Specific Conditions

We supply products to a wide range of industries. Our main customers are in the chemical, construction, electrical, electronics and photovoltaic sectors.

Good Sales Trend at WACKER’s Chemical Divisions

The chemical industry performed well in 2017. Chemical demand was spurred by the continued expansion of manufacturing activity in nearly all parts of the world. According to the German Chemical Industry Association (VCI), global chemical sales (including pharmaceuticals) totaled €4.6 trillion in 2016, with Asia accounting for close to 60 percent. The favorable situation on international markets positively influenced the performance of chemical companies in Germany. The robust trend lifted demand for German chemical products in both domestic and international markets. Capacity utilization at German chemical plants was 86.7 percent. According to the VCI, chemical production in Germany expanded by 2.5 percent in 2017. As chemical prices rose by 3.0 percent at the same time, the sector’s sales increased by 5.5 percent year over year to some €195 billion (2016: €185 billion).

At WACKER, the chemical divisions grew their total sales versus the year before. This growth was chiefly fueled by higher volumes in all segments, amid somewhat better prices overall. For WACKER SILICONES, factors that were especially positive included demand in the electronics, automotive, textile and plastics industries. WACKER POLYMERS generated slightly higher sales in and VAE . At WACKER BIOSOLUTIONS, product sales for pharmaceutical and agricultural applications were especially strong.

Construction Industry Grows in 2017

According to market research institute B+L Marktdaten GmbH, the global construction industry grew by 3.5 percent in 2017, to US$8.9 trillion (2016: US$8.6 trillion). Construction contracts in Western Europe rose by 2.4 percent. In Eastern Europe, construction expenditures were up by 1.2 percent. The North American construction industry expanded by 2.9 percent in 2017. In Asia, construction-sector growth was especially strong, climbing by 4.9 percent.

WACKER POLYMERS continued to increase its sales for construction applications. In dispersible powders, gains were fueled by the market for dry-mix mortar in every region worldwide. Overall, we sold around 28,000 metric tons more of dispersible polymer powder to the construction industry. In dispersions, WACKER POLYMERS achieved substantial gains in Asia, especially China. Beside adhesives and sealants, another key sector for our VAE dispersions was the market for water-based, environmentally compatible coatings. At WACKER SILICONES, construction-application sales also grew. The division’s three product segments – building protection, sealants and adhesives, and -modified polymers – all posted further gains. WACKER SILICONES’ sales rose in every region in 2017. Growth was particularly strong in India, South Korea, Southeast Asia and the CIS countries.

Growth Rate of Construction by Region in 2017

Growth Rate of Construction by Region in 2017 (bar chart)

Source: B+L Marktdaten GmbH, November 2017

Electrical and Electronics Industries Grow in Emerging Markets

According to the German Electrical and Electronic Manufacturers’ Association (ZVEI), the global market for the electrical and electronics industries grew 4 percent to about €4.3 trillion in 2017 (2016: €4.1 trillion). The main impetus came from China and emerging markets, which added around 7 percent and 6 percent, respectively. In Germany, the fifth-largest market worldwide, the ZVEI estimates that sales climbed to about €128 billion (2016: €125 billion).

WACKER has two business divisions that supply customers in the electrical and electronics industries. WACKER POLYSILICON supplies to customers in the semiconductor industry. At WACKER SILICONES, we increased sales of silicone to the electronics industry by 6 percent. Silanes for electronic applications gained nearly 30 percent. We generated sales growth in media-resistant potting compounds, in highly specialized silicone rubber for the semiconductor industry, and in silicone gels for automotive electronics. Cable and insulator business also grew, with sales rising by 6 percent.

Photovoltaics Pivotal for World’s Energy Supply

In the global solar industry, all signs continued to point to growth in 2017. According to various market studies, some 104 gigawatts (GW) of new capacity were installed worldwide (2016: 78 GW). That was a year-over-year increase of around 34 percent. As a result, installed photovoltaic (PV) capacity worldwide totaled about 400 GW at the end of 2017. Approximately three-quarters of the new capacity in 2017 was installed in China, India, Japan and the USA. Incentives and substantially lower system costs were major factors in the global expansion of PV installations. At the same time, the cost of non-incentivized solar energy continued falling. In several solar auctions in sun-rich regions, the electricity-trading price was down to US$0.02 per kilowatt hour.

 (XLS:) Download XLS
Installation of New PV Capacity in 2016 and 2017

 

 

  

Installation of New PV Capacity (MW)

  

Growth in
2017

 

  

2017

  

2016

  

%

Sources: Germany’s Federal Network Agency, Commissariat Général au Développement Durable, IHS, Solar Energy Industries Association (SEIA), RTS Corporation, China National Energy Agency, Apricum, India’s Ministry of New and Renewable Energy, Bridge to India, market studies, and WACKER’s own market surveys.

 

  

 

  

 

  

 

 

  

 

  

 

  

 

Germany

  

1,800

  

1,500

  

20

France

  

900

  

600

  

50

Rest of Europe

  

4,400

  

4,300

  

2

USA

  

11,500

  

14,800

  

-22

Japan

  

7,500

  

8,400

  

-11

China

  

54,000

  

32,500

  

66

India

  

9,500

  

4,300

  

>100

Other regions

  

14,400

  

11,500

  

25

Total

  

104,000

  

77,900

  

34

 

  

 

  

 

  

 

Market conditions in photovoltaics remained challenging despite strong global growth in new PV installations. On the one hand, strong demand for solar cells and modules, particularly in China and India, lifted volumes. And in the USA, impetus came from concerns about an ongoing investigation into punitive tariffs and minimum prices for imported solar cells. On the other hand, price pressure persisted due to continued overcapacity throughout the supply chain. This prevented numerous solar companies from achieving any major improvement in their financial situation, from a full-year perspective.

Raw-Material Prices, on Balance, Markedly Higher Year over Year

In general, raw-material prices were substantially higher in 2017 compared with the previous year. The price increase for methanol was particularly strong at about 40 percent. Prices for and vinyl acetate monomer (VAM) rose by around 10 percent compared with 2016. The price of metal climbed during the reporting year. At year-end, this raw material was about 10 percent more expensive than in January 2017.

Spot-Price Trends for WACKER’s Key Raw Materials

Spot-Price Trends for WACKER’s Key Raw Materials (line chart)

Ø Annual average in each case

Silicones
General term used to describe compounds of organic molecules and silicon. According to their areas of application, silicones can be classified as fluids, resins or rubber grades. Silicones are characterized by a myriad of outstanding properties. Typical areas of application include construction, the electrical and electronics industries, shipping and transportation, textiles and paper coatings.
Dispersible Polymer Powders
Created by drying dispersions in spray or disc dryers. VINNAPAS® polymer powders are recommended as binders in the construction industry, e. g. for tile adhesives, self-leveling compounds and repair mortars. The powders improve adhesion, cohesion, flexibility and flexural strength, as well as water-retention and processing properties.
Dispersions
Binary system in which one component is finely dispersed in another. VINNAPAS® dispersions are vinyl-acetate-based copolymers and terpolymers in liquid form. They are mainly used as binders in the construction industry, e. g. for grouts, plasters and primers.
Polymer
A polymer is a large molecule made up of smaller molecular units (monomers). It contains between 10,000 and 100,000 monomers. Polymers can be long or ball-shaped.
Silanes
Silanes are used as monomers for the synthesis of siloxanes or sold directly as reagents or raw materials. Typical applications include surface treatment, agents (medically active substances) in pharmaceutical synthesis, and coupling agents for coatings.
Polysilicon
Hyperpure polycrystalline silicon from WACKER POLYSILICON is used for manufacturing wafers for the electronics and solar industries. To produce it, metallurgical-grade silicon is converted into liquid trichlorosilane, highly distilled and deposited in hyperpure form at 1,000 ° C.
Ethylene
A colorless, slightly sweet-smelling gas that, under normal conditions, is lighter than air. It is needed as a chemical starting product for a great many synthetic materials, including polyethylene and polystyrene. It is used to make products for the household, agricultural and automotive sectors, among others.
Silicon
After oxygen, silicon is the most common element in the earth’s crust. In nature, it occurs without exception in the form of compounds, chiefly silicon dioxide and silicates. Silicon is obtained through energy-intensive reaction of quartz sand with carbon and is the most important raw material in the electronics industry.