U.S. demand for insulation will grow 7.8% annually through 2016 to hit $8.9 billion, largely driven by an uptick in building construction spending from 2011’s depressed levels, The Freedonia Group announced today. Changes in building codes and continued consumer interest in cutting energy consumption and utility bills can explain some of the growth, according to the Cleveland-based market research firm.
Segment growth attributable to the residential market will likely come from consumers' desire to increase home value, builders’ needs to meet new codes, as well as the attic reinsulation and home improvement and replacement markets. Growth is expected to focus on the South and West regions as they battle more consistent sunlight exposure, often requiring the use of radiant barriers and reflective insulation. Yet solid gains are also expected in nonresidential segments including office and commercial spaces.
Fiberglass siding is expected to remain the market leader in 2016, with 8.1% annual growth to hit $4.4 billion. In 2011, fiberglass filled 48% of the insulation market and is expected to keep a similar position through 2016. Foamed plastic insulation should grow by 7.3% annually to $3.9 billion in 2016. The segment had the second-largest market share in 2011 at 45%, dipping two percentage points in 2016. Radiant barriers and reflective insulation are forecasted to be up by 8.7% annually to $190 million in 2016.
Of the other insulation categories:
Demand for mineral wool, which dropped 0.3% annually between 2006 ($117 million) and 2011 ($115 million) is expected to grow 4.7% per year to hit $145 million in 2016
Cellulose dropped 2% per year between 2006 ($212 million) and 2011 ($85 million) and is expecting a boost of 15.5% annually to $175 million in 2016.
The numbers are a part of a 331-page market report called “Insulation” sold by Freedonia for $5,100.