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U.S. demand for refractories is projected to grow 3.3% per year to $2.6 billion in 2016, according to a new study from The Freedonia Group Inc. Output of steel in the U.S. will grow following a period of decline, driving demand for refractories. Gains will also come as nonresidential fixed investment spending returns to strong growth through 2016, prompting a resurgence in the manufacture of goods such as ceramics and glass.
In 2011, sales of refractories to iron and steel manufacturers totaled $990 million, making up 45% of all refractory sales. Following a decline in steel output caused by the most recent recession, steel manufacturing in the U.S.—and associated refractory demand—is expected to rise through 2016. A shift in consumption toward higher priced, advanced refractories will bolster sales value. However, the development of longer lasting, more durable refractories is predicted to limit demand going forward. Most materials manufacturing industries have reduced their per-production-unit consumption of refractories by using these newer, more durable products and improved processes.
The fastest gains of any market in dollar terms will reportedly be posted by nonmetallic minerals. This market includes ceramics, glass and cement producers. Output from these industries will rebound as the U.S. economy continues to grow, fueling related refractory demand. Further growth will come from nonmanufacturing markets for refractories, such as waste-to-energy plants, traditional power plants, and commercial ovens, although these are all fairly small markets. The largest sales volume increases will likely be in the engineering contractors market, which will rise more than 50,000 tons between 2011 and 2016, recovering from declines posted during the 2006-2011 period.
For additional information, visit www.freedoniagroup.com.