U.S. demand for insulation will climb 7.4% per year from 2009 to reach $10.2 billion in 2014, with fiberglass overtaking foamed plastic to once again stand as the top-selling material and with cellulose showing the greatest percentage increase, the Freedonia Group forecast today.
A rebound in new-home construction will propel growth overall, helped by expanded production of major appliances and transportation equipment, the Cleveland-based market research group said. Traditionally, residential markets accounted for at least 40% of the total insulation demand, but because of the housing market's decline they accounted for only 29% of the total by 2009. That's one reason insulation demand actually declined 1.3% annual in recent years, totaling $7.64 billion in 2004 but only $7.15 billion in 2009. It also helps explain why fiberglass demand, in 2004 the leading insulation type at $3.95 billion, dropped 3.8% per year to reach $3.26 billion in 2009.
Because of an expected turnaround in housing, demand for fiberglass insulation will rise 9.1% annually to hit $5.04 billion in 2014, Freedonia forecast. That will be enough to outpace foamed plastic, which after growing 1.1% annually, from $3.19 billion in 2004 to $3.37 billion in 2009, will increase 5.3% a year to $4.37 billion in 2014.
Among the other insulation types:
- Demand for reflective/radiant products, which grew 4.5% annual from 2004 ($119 million) thru 2009 ($148 million), will increase 9.7% a year to hit $235 million 2014.
- Meneral wool demand, which rose 1.4% a year between 2004 ($109 million) and 2009 ($117 million), will increase 4.4% a year to $145 million in 2014.
- Cellulose, which saw demand drop 3.4% annually between 2004 ($181 million) and 2009 ($152 million), will reverse course and increase 14.2% a year to reach $295 million in 2014. "the environmental and performance advantages of cellulose ilnsulation will benefit demand, although the primary driver will be the strong rebound in new housnig construction," Freedonia said.
The company makes more complete forecasts in a market report that it sells for $4,900.