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[September 2003]
Report Published on Refractories Demand in USA
Demand for refractories in the USA is projected to increase by 2.2% per year to reach US$2.4 billion in 2007, a dramatic turnaround from the 1997 to 2002 period which saw declines of nearly 3% per year. The improved outlook for refractories is based on improved fundamentals for many of the major end-use markets, particularly iron and steel following that industry's collapse starting in late 1997. Since the iron and steel market represents nearly half of all refractory demand, the turnaround will benefit refractory producers. These and other trends are presented in 'Refractories', a new study from The Freedonia Group Inc (Cleveland, OH, USA).
Over the past several decades, there has been a massive rationalisation and consolidation in the US refractories industry. Also, consumption per unit of output declined. However, this process has largely played itself out and consumers are unlikely to become significantly more efficient users of refractories for the foreseeable future. The widespread consolidation and this new found stability in the rate of consumption means that refractory supply and demand are now more closely aligned than they have been for some time. Thus, the outlook for the surviving refractory producers is much brighter than the relatively modest growth prospects might indicate.
Among the refractory forms, preformed shapes and castables are expected to see the best growth, while from a materials perspective, nonclay materials will outperform clay refractories. More specifically, the switch to better performing refractories will lead to the best opportunities for silicon carbide and zircon and zirconia refractories. However, similar to the industry as a whole, many individual refractory materials will not recover to 1997 levels until after 2007.
Amongst the various refractories markets, the best growth opportunities in percentage terms will continue to be found in less traditional end uses such as waste-to-energy generation and restaurants with in-house bakeries and stone ovens. However, given the small size of these markets, their impact on aggregate refractory demand will be minimal. Much more critical to the overall health of the refractories industry will be the turnaround in US steel production.
'Refractories' has just been published and is available for US$3,900.
www.freedoniagroup.com
ENDS