Indonesia Adhesives and Sealants Market Size & Share Analysis - Growth Trends & Forecasts (2025 - 2030)

Indonesia Adhesives and Sealants Market Analysis

The Indonesia Adhesives And Sealants Market size is estimated at USD 0.96 billion in 2025, and is expected to reach USD 1.33 billion by 2030, at a CAGR of 6.66% during the forecast period (2025-2030).

The Indonesian adhesives and sealants industry is experiencing significant transformation driven by evolving consumer preferences and technological advancements. The rapid digitalization of retail channels has fundamentally altered distribution patterns, with online shopping penetration reaching unprecedented levels. The shift towards e-commerce has created new opportunities for adhesive technologies manufacturers to expand their market reach, with the number of online shoppers in Indonesia projected to exceed 65 million. This digital transformation has necessitated innovations in packaging solutions and product formulations to ensure stability during transportation and storage.

The industry is witnessing a notable shift towards sustainable and environmentally friendly solutions, particularly in bio-based adhesives and sealants. Manufacturers are increasingly focusing on developing products derived from renewable resources, including vegetable oils, bio-polymers, proteins, and polysaccharides. These bio-based alternatives not only address environmental concerns but also offer enhanced performance characteristics such as improved water resistance and substrate adhesion. The inherent biodegradability of renewable materials like starch, polyhydroxyalkanoates, and cellulose has become a key differentiator in product development strategies.

The electronics and consumer goods sector has emerged as a significant growth driver for specialized electronic adhesives, with consumer electronics revenue reaching USD 6.3 billion in 2020. The increasing complexity of electronic devices and the growing demand for miniaturization have created new requirements for high-performance adhesive technologies that can withstand various environmental conditions while maintaining electrical and thermal conductivity. The government's initiative to reduce energy tariffs and streamline licensing processes has further stimulated growth in the electronics manufacturing sector.

The market is experiencing substantial transformation through foreign investment and technological partnerships. Major industry players are expanding their presence through strategic investments, exemplified by Nine Dragons Paper's planned USD 1 billion investment for paper production capacity expansion. This influx of foreign investment is facilitating technology transfer and innovation in industrial adhesives formulations, particularly in high-performance and specialty applications. The industry is also benefiting from government initiatives to promote domestic manufacturing capabilities and reduce reliance on imports, though challenges remain in raw material sourcing.

Indonesia Adhesives and Sealants Market Trends

Increasing Demand from Packaging Industry

The packaging industry has emerged as a significant driver for the packaging adhesives and sealants market in Indonesia, supported by robust growth in packaging volumes and substantial industry investments. The packaging sector's expansion is evident from the increase in packaging volume from 160.55 tons in 2022 to 168.34 tons in 2023, indicating growing demand for packaging solutions. This growth is further amplified by the rising e-commerce sector, which requires specialized packaging materials for safe product shipping and handling, thereby increasing the consumption of various packaging adhesives and sealants in packaging applications ranging from corrugated boxes to laminated sheets.

Major investments in the packaging sector underscore its growth trajectory and subsequent impact on adhesives demand. For instance, in 2022, China-based packaging company Lamipak initiated the construction of its second factory in Indonesia, with plans to expand its capacity to 18 billion packs annually by 2024 through a USD 200 million investment. Similarly, PT Sariguna Primatirta Tbk. (Tanobel) has allocated IDR 300 billion (USD 19.88 million) in capital expenditure in 2023 for factory construction and distribution network expansion. These investments, coupled with the increasing adoption of flexible packaging solutions and the growing demand for sustainable packaging materials, are driving the consumption of adhesives and sealants in applications such as food and beverage packaging, container packaging, film-foil laminates, and carton side seams.

Rise in Demand from the Construction Industry

The construction industry stands as a crucial growth driver for the construction adhesives and construction sealants market in Indonesia, supported by extensive infrastructure development initiatives and government investments. The sector's significance is highlighted by the government's substantial infrastructure budget allocation and the implementation of various construction projects across the country. The private sector's involvement in developing 65% of the construction projects, including 2,600 km of roads, 49 dams, 5,500 km of railways, 1,000 km of toll roads, and 24 seaports, demonstrates the extensive scope of construction activities driving adhesives and sealants demand.

A major catalyst for construction-related adhesives and sealants consumption is the government's ambitious plan to develop a new capital city on the island of Borneo, with an investment of IDR 466 trillion. This massive project, along with other infrastructure developments, has positioned Indonesia's construction sector as the second most profitable market in Asia. The extensive use of construction bonding agents and construction adhesives in various construction applications, including roofing, interior finishes, vertical walls, below-grade applications, and flooring installations, particularly in public buildings such as railway stations and airports, continues to drive market growth. Additionally, the increasing adoption of bonded houses made of timber joined through bonding agents represents a sustainable and safe construction method, further boosting the demand for construction adhesives and construction sealants.

Segment Analysis: Technology

Water-borne Segment in Indonesia Adhesives Market

Water-borne adhesives continue to dominate the Indonesia adhesives market, commanding approximately 46% of the total market share in 2024. This significant market position is primarily driven by their environmentally friendly nature and low volatile organic compound (VOC) emissions compared to other adhesive technologies. The segment's growth is further supported by increasing regulations favoring eco-friendly adhesive solutions across various industries. Water-borne adhesives find extensive applications in packaging, construction, and woodworking industries, with particular strength in paper processing and packaging applications. The segment's success is also attributed to its excellent adhesion properties, versatility in bonding different substrates, and growing adoption in sustainable manufacturing practices.

Hot-melt Segment in Indonesia Adhesives Market

The hot-melt adhesives segment is experiencing the most rapid growth in the Indonesia adhesives market, with an expected growth rate of approximately 7% during the forecast period 2024-2029. This impressive growth trajectory is driven by increasing demand from the packaging industry, particularly in flexible packaging applications. The segment's expansion is further supported by technological advancements in hot-melt adhesives formulations, leading to improved performance characteristics such as better thermal stability and faster setting times. The automotive and electronics industries are also contributing to this growth through increased adoption of hot-melt adhesives in various assembly applications. The segment's success is additionally bolstered by its solvent-free nature, rapid bonding capabilities, and cost-effectiveness in high-speed manufacturing processes.

Remaining Segments in Technology

The other significant segments in the Indonesia adhesives market include reactive adhesives, solvent-borne adhesives, and other specialized technologies. Reactive adhesives are particularly valued in high-performance applications requiring superior bond strength and durability, especially in the automotive and construction sectors. Solvent-borne adhesives, despite environmental concerns, maintain their importance in specific industrial applications where high performance and quick drying times are crucial. Other specialized technologies continue to serve niche applications, offering unique properties for specific industry requirements. These segments collectively contribute to the market's diversity, providing solutions for various specialized bonding needs across different industries.

Segment Analysis: Sealants – By Product Type

Silicone Segment in Indonesia Sealants Market

The silicone sealants segment continues to dominate the Indonesia sealants market, holding approximately 35% market share in 2024. Silicone sealants have gained significant traction due to their versatile properties, including excellent resistance to weathering, ability to withstand temperature extremes, and outstanding flexibility. The saturated inorganic Si-O-Si polymer provides exceptional stability to sunlight exposure, while the methyl groups ensure low intermolecular forces. These sealants demonstrate remarkable adhesion to various substrates, including aluminum, cold-rolled steel, galvanized steel, glass, and many plastics, making them ideal for diverse applications. In the construction sector, silicone sealants are extensively used for sealing exterior joints, metal-to-glass sealing, expansion joints, and bathtub sealing. The segment is also witnessing strong demand from the electronics and electrical industries, where these sealants are crucial for cable and sensor sealing applications, particularly due to their ability to withstand extreme temperatures.

Remaining Segments in Sealants Market by Product Type

The polyurethane segment represents a significant portion of the market, offering excellent flexibility and impact resistance for construction and automotive applications. These sealants form waterproof seals on concrete, masonry, glass, plastic, wood, aluminum, and most other metals, with an impressive service life. The acrylic segment serves various applications in construction and DIY projects, particularly valued for its compatibility with multiple materials and ease of use in household applications. Other sealants, including polysulfide, silyl modified, and epoxy sealants, cater to specialized applications across various industries, each offering unique properties such as chemical resistance, weather resistance, and specific curing mechanisms to meet diverse end-user requirements.

Segment Analysis: By End-User Industry

Paper, Board, and Packaging Segment in Indonesia Adhesives and Sealants Market

The paper, board, and packaging segment dominates the Indonesia adhesives and sealants market, accounting for approximately 32% of the market share in 2024. This segment's prominence is driven by the rapid growth of Indonesia's e-commerce sector and increasing adoption of home deliveries, which has significantly boosted the demand for packaging materials. The segment's growth is further supported by Indonesia's position as one of the major paper producers and exporters, with paper packaging gaining substantial traction due to its environmental friendliness and ease of manufacture. The increasing penetration of online grocery markets and the shift in consumer preferences towards packaged products over conventionally sold loose items has created robust demand for adhesives in this sector. Additionally, the rising need for storage and safe transportation of packaged products, coupled with the country's growing economy and rising disposable incomes, has led to increased consumption of packaged products, further driving the demand for pressure-sensitive adhesives and sealants in this segment.

Building and Construction Segment in Indonesia Adhesives and Sealants Market

The building and construction segment represents a significant growth opportunity in the Indonesia adhesives and sealants market. The segment's expansion is driven by the Indonesian construction industry's massive potential, which already accounts for 10% of the country's GDP. The government's ambitious infrastructure development plans, including the construction of 25 airports, new power plants, and the development of Jakarta's Metro network extension with an investment of approximately USD 40 billion, are creating substantial demand for construction adhesives and sealants. The increasing demand for new offices, buildings, production houses, and smart cities is further propelling the segment's growth. Additionally, the government's commitment to renovating low-quality houses and the development of the new capital city in Borneo with an investment of IDR 466 trillion are expected to create significant opportunities for structural adhesives and sealants manufacturers in the construction sector.

Remaining Segments in End-User Industry

The other significant segments in the Indonesia adhesives and sealants market include transportation, electrical and electronics, healthcare, woodworking and joinery, and footwear and leather industries. The transportation segment plays a crucial role in automotive applications, while the electrical and electronics segment is driven by the country's growing consumer electronics market. The healthcare segment is benefiting from increased investment in medical infrastructure and universal healthcare programs. The woodworking and joinery segment leverages Indonesia's position as the world's largest tropical timber exporter, while the footwear and leather segment continues to support the country's robust manufacturing sector. Each of these segments contributes uniquely to the market's diversity and overall growth, with varying demands for specific types of adhesives and sealants based on their particular applications and requirements.