Insulation Market Overview
The global insulation market is estimated to account for $52,296 million revenue in 2017 and is projected to witness a CAGR of 8.62% during the forecast period. Growing demand for insulation in residential and non-residential projects for ensuring energy conservation is driving the growth of the insulation market, globally.
On the basis of product, the insulation market has been segmented into glass wool, mineral wool, expanded polystyrene (EPS), extruded polystyrene (XPS), and others. Of these, both glass wool and EPS are expected to be the largest categories during the forecast period.
Glass wool is a warm protector, mainly comprising of glass fibers bound in a systematic structure, having resemblance to wool. In addition, the product is lighter in contrast to rock wool and helps trap air inside, bringing about low thickness.
On the basis of application, the insulation market has been segmented into residential construction, non-residential construction, industrial, heating, ventilation, and air conditioning (HVAC) & original equipment manufacturer (OEM). The residential construction has been holding the largest share in the market, owing to increasing residential construction projects across different countries in the world.
Globally, North America is expected to lead the insulation market in terms of size, during the forecast period. The market in the U.S. especially, is advancing at a high rate considering the increased demand from end users. Strict environment standards and various government initiatives such as Affordable Housing Institute (AHI) and Made in Canada are expected to support the region’s residential insulation market during the forecast period. Increasing population due to urbanization and emphasis on restoring domestic manufacturing sector are expected to drive the construction market in Canada; thereby, resulting in the growth of the insulating materials market.
Insulation Market Dynamics
The demand for energy is rising in developed as well as developing countries, along with rising energy costs. Insulating residences can save up to 20% of the routine energy costs, as it plausibly brings down the warming and cooling costs during the different climatic conditions. According to a research conducted by Harvard School of Public Health, about 45 million residencies in the U.S. are under-insulated, which in itself creates huge opportunities for the insulation market growth in North America.
High urbanization and growth in population coupled with high industrialization rates in emerging markets such as South Africa, India, China, and Brazil have propelled the need for better industrial and residential infrastructure. Additionally, rising energy costs and government initiatives to improve energy efficiency is expected to trigger the demand for insulating products in industrial and residential buildings; thus, leading to the expansion of the insulation market.
Given the reduced reliance on exports from Asia, the economic growth in Western Europe and North America is likely to fall on domestic supply. With reduced imports, countries are expected to rely on trade and business in their home markets. A robust local labor market and a relatively easy access to finance would certainly facilitate this. In the long run, the trend will intensify because domestic demand will be fueled further by the growing middle class and rising income levels; thus, impacting the insulation market positively.
Due to growth in disposable income levels, the proportion of the middle-class population is growing in developing countries, which is also bringing a surge in construction activities in these markets. Thus, increasing residential and industrial construction, and infrastructure development in emerging markets is boosting the growth of the insulation market.
There has been a significant growth in the global air-conditioner and refrigerator markets, primarily fueled by the rising demand in India and China. Cooling appliance insulation is another important contributor to the growth of the insulation market. On account of the rising global temperatures and with advancements in cooling technology, the demand for cooling appliance insulation has picked up growth even in the mature markets of the U.S. and Europe. Availability of sophisticated and energy-efficient appliances, and replacement sales are driving the market growth in these regions.
The constituents of plastic foam products in the insulation market, such as polyethylene, elastomers, and extruded polystyrene (EPS), are downstream derivatives of crude oil. The uncertainty of crude oil pricing is a major restraint for the growth of the industry. Moreover, it is difficult to determine an optimum price-range for insulators due to fluctuations in raw material prices as well. Thus, these factors restrain the growth of the insulation market.
Insulation Market Competitive Landscape
Some of the major players operating in the global insulation industry are GAF Materials Corporation, Guardian Building Products Inc., Huntsman Corporation, Johns Manville, Cellofoam North America Inc., CertainTeed Corporation, ROCKWOOL International A/S, Dow Building Solutions, Owens Corning, Atlas Roofing Corporation, Saint-Gobain S.A., Byucksan Corporation, and Kingspan Group.