Global demand for refractories is projected to rise 5.3% per year through 2014 to 40.7 million metric tons. China will remain the largest national market and will continue to comprise the majority of global demand, according to “World Refractories,” a new study from The Freedonia Group Inc.
Above-average growth will also occur in India due to solid gains in fixed investment expenditures. Suppliers will benefit from an improvement in the key U.S. market, which will rebound from dismal levels in 2009. Raw material supply will continue to be a challenge to refractory producers, especially those in Europe and the Western Hemisphere.
The world refractories industry has been negatively affected in recent years by a slowdown in steel and iron output. Given the refractory-intensiveness of ferrous metal production processes, coupled with the fact that this sector typically accounts for about three-fifths of the volume of refractories consumed, refractory producers contended with sluggish demand for their products in 2009. Markets most affected were the developed areas such as the U.S., Western Europe and Japan.
Despite declines in the amount of units needed per ton of steel produced, iron and steel will show the strongest gains of any market through 2014 due to rising steel production. Demand for refractories used in the production of other metals will rise, benefiting from increased output of materials such as aluminum. Gains are also expected in the nonmetallic mineral products market, spurred by growth in the production of ceramics, cement and other mineral products, fueling demand for associated refractories. Other markets, including petroleum, chemicals, paper and aerospace, will benefit from rising production by end users.
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