Coalescing agents are added following the polymer dispersion binder, through the let-down stage of paint production process. The agent prevents the coagulation of the polymer binder which is highest if water insoluble coalescing agents are added. Low water-soluble hydrophilic coalescing agent are commonly used as they have higher efficiency, and low water solubility, which furthermore reduces the risk of penetration in porous substrates. There is a growing demand for coalescing agents which are colourless, deliver high quality, and has no effect on the VOC of paints and coatings, which is expected to boost the coalescing agents market over the forecast period.

There is a rise in the requirement for more environmentally friendly coalescing agents used for water-based paints and coatings and meet the strict regulations implemented on VOC (volatile organic compounds) in several countries all over the world. Cost effective coalescing agents offered by various companies which provide suitable MFFT reduction which fulfil the current industry-standards, work efficiently for all resin types and have no reduced performance of film regarding hardness or gloss, scrub resistance, and blocking/anti-tack are expected to fuel the coalescing agents market over the coming years.

The coalescing agents market by type is segmented into hydrophilic and hydrophobic coalescing agents. Coalescing agents play a very crucial role in enhancing film formation and ensures smooth and uniform surface finish. Hydrophilic coalescing agents are widely used for various applications and is the fastest growing application segment. Hydrophilic coalescing agents mainly include water-soluble glycol ethers and glycols such as DPB (dipropylene glycol butyl ether) and PB (propylene glycol butyl ether). These agents partially dissolve the polymer after water evaporation and also control water evaporation and freeze-thaw stability. Hydrophilic coalescing agents are highly efficient and have low rate of evaporation owing to which the demand for coalescing agents is expected to grow over the forecast period.

Rise in the demand of paints, coatings, inks, and adhesives in other industries such as the aerospace industry, and use of bio-based coatings paints is driving the demand of coalescing agents in developing as well as developed countries. Additionally, increasing industrialization and infrastructure development in developing countries are crucial factors which are continuously contributing to the growth of coalescing agents market all over the world.

Asia Pacific is the fastest growing region in the coalescing agents market, projected to reach USD 707 Million till 2025, growing at a CAGR of 5.4% over the forecast period. Asia pacific region is mainly driven by the developing nations such as India, and China. China is one of the biggest automotive aftermarket industries in the Asia Pacific region. In 2018, there were around 170 million vehicles on road in China, addition to which there is a growing service life of the vehicles. The growing automotive industry in the region is also driving its related markets such as paints, coatings, adhesives, sealants, and others. Due to this high demand for automotive and use of non-VOC coalescing agents, the market is expected to experience a significant growth over the forecast period.

Asia Pacific region also captures the maximum market share in the coalescing agents industry. Asia Pacific is also one of the fastest growing region due to the presence of major paint, coatings, inks, plastics, and rubber industries. Additionally, the coalescing agents market is expected to experience a boost in countries such as China and India owing to the growing automobile sector. Various coalescing agent manufacturers in the North American and Europe region are shifting their manufacturing base to low-cost countries in Asia Pacific such as Indonesia, Vietnam, and others owing to the lack of strict environmental regulations, compliance issues, low production cost, cheap labour, and availability of raw material in abundance.

Key players operating in the global Coalescing Agents market are Eastman Chemical Company, Dow Inc., DuPont de Nemours, Inc., BASF SE, Evonik Industries, Rudolf GmbH, Stepan Company, Arkema, Celanese Corporation, Cargill, Incorporated and others.