It is estimated that supply and demand of our coatings market in 2005 will be balanceable generally. Following are main characters:
1. Supply and demand is generally balanceable, and the demand is      increasing.
In 2005, consumption of decoration coatings and architectural coatings will increase. Demand for coatings will reach 2.55 million tons, with 0.9 million tons industrial coatings, 1.15 million tons architectural coatings and 0.5 million tons specialty coatings and other functional coatings. Supply of coatings in 2005 will be about 2.6 million tons.

2. Development of automobiles and real estate will be restricted to a certain      extent.
Building of houses is still a hot point of our economic growth. Constant decoration will also enlarge the demand for coatings. Some experts said in future 3 years, our rural area need 568 million m2 houses, which has a huge potential.

3. Environmental protection high quality and multi-functional coatings will      become welcomed.
Waterborne coatings will become the most welcomed kind. Our country need 1.7 million tons industrial coatings annually, 1 million tons of which could be replaced by waterborne industrial coatings. In architectural coatings market, we’ll produce 1.8 million tons in 2005, most of which will be replaced by environmental protective waterborne coatings.

4. Coatings market will expand outside and the market orientation of kinds      will become globalization.
Because the recovery of global economics, demand of international market is increasing. The export prospect of our coatings is promising.

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