Growth in Tire Manufacturing
There has been an increasing trend of zinc oxide utilization in South and Central America due to the increasing tyre manufacturing activities in the regions, especially in Brazil, Argentina and the Mexico-associated supply chain network in Central America. The material plays a vital role in making rubber that helps in the process of rubber vulcanization that makes tires elastic, durable, resistant to heat, and resistant to abrasions. Brazil leads the way in terms of automotive and tire manufacture in the region due to its well-developed industry and high domestic demand for automobiles. The tire manufacturing companies and foreign tire firms with tire manufacturing plants located in São Paulo and other regions of Brazil provide constant consumption of zinc oxide in tire manufacturing.
The rise in demand for transportation and logistic services in the area has also resulted in an increase in demand for tire replacement. Due to the expansion of agricultural exports by Brazil and Argentina, and the operations of mining in nations like Chile and Peru, there has been an increase in the number of heavy duty trucks and other off road vehicles in use. This implies that the tire compounds must be of high durability to endure the long distance driving on tough surfaces, resulting in the use of zinc oxide reinforced rubber tires.
Further, investment in local manufacturing activities adds another layer of positive expectation for the market environment. Some countries within the region are pushing for manufacturing of auto parts within their territory as a means of cutting back on imports. Some industrial zones within Brazil and Colombia are starting to lure some suppliers who manufacture rubber products, industrial hoses, conveyor belts, and auto seals – products that require the use of zinc oxide in the manufacturing process. As ownership of vehicles increases in the region, demand for zinc oxide in tires and rubber will steadily rise.
Growth in Emerging Economies
The rise in emerging economies across South America and Central America has been creating more demand for zinc oxide in industries like construction, agriculture, ceramics, chemicals, and consumer goods. Countries like Brazil, Colombia, Peru, and Guatemala are witnessing a steady increase in industrialization, which can be attributed to the factors of urbanization, infrastructural development, and increased middle-class demographics. The use of zinc oxide in paints, coatings, adhesives, fertilizers, and ceramic items is gradually becoming popular due to diversified industrial activities beyond commodity exports.
Increased urbanization in metro cities like Sao Paulo, Bogota, Lima, and San Jose has been creating more demand for zinc oxide. Materials containing protective coatings made of zinc oxide are being used in large amounts in building constructions due to their UV-resistance and corrosion resistance features. Various public infrastructures, including transport, energy, and industry, are becoming an important consumer of specialty chemicals and engineered materials requiring zinc oxide as a key ingredient.
Agriculture continues to be another growth catalyst for emerging markets in the region. The usage of zinc oxide as feed supplements and micronutrient fertilizers in order to enhance agriculture production efficiency and animal health continues to grow especially in countries that have a very high level of agricultural output such as Brazil and Argentina. Higher level of knowledge concerning the need to manage soil nutrients and produce high quality agro produce has led to increased usage of zinc oxides in the agricultural sector. On the other hand, higher level of industrialization is causing higher usage of zinc oxides in the manufacture of rubber, pharmaceutical, and cosmetic products.
