Global refractories demand is projected to expand at a 3.4% annual rate through 2016 to 46.3 million metric tons, an improvement over 2006-2011 market performance, according to a new study from The Freedonia Group Inc. Product sales are expected to climb 5.3% annually in value terms to $46.5 billion in 2016—not as strong as gains registered in recent years because of a moderation in raw material costs and refractories prices. The iron and steel market will reportedly continue to dominate global refractories sales, accounting for almost three-fifths of all 2016 product demand in volume terms. 

Refractories sales should expand most quickly in developing areas, reflecting an ongoing shift in metals and other heavy industry production to countries with low cost structures. The Asia-Pacific region, in particular, will post the largest tonnage increases, followed by the Africa/Mideast region, Central and South America, and Eastern Europe. China alone will account for more than seven-tenths of all refractories volume gains between 2011 and 2016, due both to additional growth in its huge steel, cement, and other heavy manufacturing industries, and to the use of less sophisticated production methods in steelmaking and other important markets than those used in economically advanced nations, resulting in greater refractories use in per unit of output terms.

The volume of refractories consumed is projected to rise in the U.S., Western Europe, and Japan following an extended period of decline, as economic conditions strengthen in these areas and output of ferrous metals and other refractories-using products rebounds. Output gains in these areas are more likely to result in higher refractories demand because the manufacturing techniques used are already so efficient that it will be much more difficult to reduce refractories consumption on a per unit output basis than in less developed countries. Due to their greater use of more costly, high-quality products, the U.S., Western Europe, and Japan will account for a somewhat larger share of the world refractories market total in dollar terms (19%) in 2016 than they will in tonnage (14%).

For additional information, visit www.freedoniagroup.com.