Market trends

Extensive use of mineral wool in Russia has not revived the market

The growth of the construction mineral wool market has stopped since 2014. Although the manufacturers report an increase in the mineral wool output, domestic demand is declining.

This is what the Ogneportal informed, citing RBC’s analysts. The experts believe that market players will be able to retain their positions only through expanding export operations or merging into production holdings. According to RBC, about 50 companies are engaged in the manufacture of basalt thermal insulation. The largest market players are TechnoNICOL with 36% and Rockwool with 20%. Tizol counted as many as 20 Russian manufacturers of basalt super-thin fiber.

At the same time, PAROC, a player in the stone wool market, has claimed that in 2016 half of the total sales volume of thermal insulation market referred to mineral wool insulation (about 21.5 million cubic meters). Company spokespeople state that stone wool insulation is gradually replacing other kinds of insulation, both in multi-storey and private construction.

Despite the growing popularity of stone wool among domestic developers, its production becomes less profitable. Firstly, this is due to the glut on the market these days, causing a drop in the average product price to 8% in 2016. In regions with the greatest glut of production capacity, some companies start to go into the red. Secondly, the growing prices for energy and raw materials, and the rise in the logistics cost also made a negative contribution.

These factors will force some manufacturers of basalt thermal insulation to leave the race. For those manufacturers who follow a policy of reducing prices to the detriment of quality, a new national standard for mineral wool materials, which came into effect on July 1, may become a source of problems.

Of note, the global mineral wool market shows steady growth and is expected to reach $22 billion in 2022. Leading Russian manufacturers seek to take advantage of the favourable situation in the market. Thus, the plants of TechnoNICOL extensively expand the customers’ geographical base. For instance, the company plans to supply 100 thousand cubic meters of stone wool to China within two years and also ships the products of Khabarovsk plant to Canada.

Companies: PAROC, TechnoNICOL, Tizol

Countries: Canada, China, Russia

Industries: Construction, Energy

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