| AM24035 |
| AMA RESEARCH Market Report : UK Building Chemicals : April 2004 |
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Introduction and Overview
| AMA Research has published the second edition of Building Chemicals Market– UK 2005 report. The report incorporates original research and provides a comprehensive and up-to-date review of the market – representing a worthwhile investment and giving excellent value for money. |
| Product areas covered in the report include: - |
| Admixtures. |
| Sealants. |
| Mortars, Renders and Grouts. |
| The building chemicals market services the needs of a range of end use sectors including civil engineering, ready mixed concrete, concrete repair and refurbishment and house building. As such it is linked closely to the fortunes of the building and construction market, which have been reasonably buoyant in recent years. |
| The market has seen some change in recent years, with the growth of international suppliers and greater levels of international trade evident in all market sectors. |
| The report is a review of the market in quantitative terms as well as a detailed qualitative analysis of the background reasons and future trends. Information is collated from a wide range of trade and other sources and not simply a collection of government statistics – data and comment is therefore specific and relevant to the market involved. |
| Key Issues Covered Include: - |
| Greater levels of price competition in certain sectors of the market. |
| Changing distribution patterns and their influence on the market. |
| Government capital spending, especially in the healthcare and education sectors, will impact favourably on the Building Chemicals market. |
| Key suppliers and their role in the market. |
| Increasing trend towards large international groups acquiring UK based suppliers. |
| Imports of building chemicals expected to rise. |
| Key areas of coverage include:- |
| THE BUILDING CHEMICALS MARKET |
| Definition of product types and a review of the market structure. |
| Building Chemicals Market Size and trends. Brief history and types of products, current situation and future prospects, forecasts to 2008. key influences and trends. |
| Market mixes – Size of product sector versus application market size, key application areas. |
| Key Market Influences in terms of industrial output and investment, the UK economy, the UK construction industry - contractors output, industrial construction, commercial construction and new orders. |
| THE PRODUCTS |
| Review of the building chemicals market and the mix of products, incorporating admixtures, sealants and mortars, renders and grouts. |
| Comment on the developments in each of the product sectors. |
| Market-mix, product types and supply issues by product group. |
| SUPPLIERS AND DISTRIBUTION |
| General outline of the structure of the suppliers and market shares of the major suppliers in the building Chemicals Market. |
| Market leaders characteristics, turnovers etc. |
| Outline of the alternative distribution channels, comment on each of direct distribution, specialist distribution, builders merchants etc. |
| END USE APPLICATION AREAS |
| Review of the key end-use application areas, including house building, civil engineering, ready mixed concrete, concrete repair and refurbishment. |
| Comment on background, market structure, market development, for each of the above. |
| Other end use sectors, trends and issues - food processing and storage, chemical processing and pharmaceuticals, major manufacturing, hospitals and health, distribution & warehousing. |
| FUTURE PROSPECTS |
| Prospects for the building chemicals market, factors influencing medium term growth. |
| Developments in the major product and market sectors. |
| Likely distribution changes and developments |
Executive Summary
| The Building Chemicals market is part of the overall UK Construction and Maintenance market, which is valued at around £80 billion. New construction output is valued at around £51 billion and Repair and Maintenance a further £30 billion. The value of the Building Chemicals market as defined by this report is around £140 million at manufacturers selling prices. |
| The major suppliers of building chemicals produce a comprehensive range of mortars, renders and grout products. The market for these products is worth some £74 million and represents some 52% of the Building Chemicals market. |
| The sealants market is large and diverse and is estimated to be worth around £53 million excluding construction industry supply. This can be classified as part of a UK adhesives market of some £900 million, and many of the main suppliers of sealants are also principal suppliers of adhesives. All the major suppliers of building chemicals to merchants and direct to civil engineering contracts have products in the sealants sector. |
| Admixtures are used by all of the end use sectors discussed in this report, though the market is relatively small at approximately £14 million. Admixtures can be defined as products, which are used to modify and improve the performance of cement-based products, by addition at ready mix plants or by addition on site, where product is batched and mixed at the place of use. |
| The ready mixed concrete industry is the largest user of admixtures, with around 20 million tonnes of ready mixed materials manufactured in the UK. This market is valued at £850 million with Tarmac Topmix, Lafarge and RMC accounting for over 80% of the market. The concrete repair market, which is serviced by many suppliers of the above products and specialist contractors, is currently estimated to be worth £130 million. |
| The performance of the UK Building Chemicals Industry is closely linked to output in the construction industry, which has traditionally followed a pattern of cyclical economic activity and is often used as a key indicator of general economic performance. The Building Chemicals market experienced reasonable growth in the period 2000-2004 reflecting the combination of a difficult period in the RMI sector of the non-domestic construction industry, which is the key application area for these products balanced by good growth in new build of many construction industry sectors. |
| In 2003 new housing was one of the leading sectors within the UK construction industry, contributing just over 31% in terms of output value, with the level of housing completions also increased to 173,5000. Output in the overall housing sector now stands at over £15 billion, compared with £12 billion during 2002, reflecting the general buoyancy of the market during the year. |
| The government is committed to an increased social housing programme and has recently announced a programme of funding of around £5 billion to support its Sustainable Communities Plan, aimed at the provision of affordable housing in four key growth areas of the South East. The government has predicted a requirement to build an estimated 200,000 homes in London and the South East by 2016, to avoid a future housing shortage, which will help to support growth in the Building Chemicals market. |
| Although forecasts predict that construction output will decline in 2005 for the first time in a decade and low levels of private sector growth will constrain construction activity, the anticipated levels of government capital spending are expected to add a measure of buoyancy for the construction industry and impact favourably on the Building Chemicals market. |
| As a result it is anticipated that the building chemicals market will show modest growth of between 3% and 5% over the next 3 to 4 years, reflecting the large scale public sector capital investment, both in new build and refurbishment sectors. |
| Public sector construction work will be boosted by the government’s current commitments to improving public services, infrastructure and social housing. Transport, education, health and public housing expenditure are all expected to drive growth over the next few years and increase public sector output by 3.1% in 2005 and 2.5% in 2006. |
| There are some 300 building chemicals supply companies active in the market, a few of which are dominant in all sectors. Most suppliers, however, focus their activities in one or several niche sectors of the market. |
| Routes to market are complex, due to a combination of sales by direct methods, specialist distributors and builders merchants. |
| There is also an increasing trend towards large international groups acquiring UK based suppliers as part of a global strategy. The UK market leaders in building chemicals are all owned by foreign companies and it is envisaged that there will an increasing trend towards manufacturing in fewer, but larger locations around the world. Imports have traditionally accounted for only a small part of the supply of building chemicals, as the market has been serviced from UK manufacturers, though this is beginning to change and it is anticipated that there will be a decrease in UK manufacture and a growth of imports in the medium term. |
List of Contents
| 1 | INTRODUCTION |
| 2 | SUMMARY |
| 3 | ECONOMIC ENVIRONMENT |
| 3.1 | GDP |
| 3.2 | INFLATION & INTEREST RATES |
| 3.3 | UNEMPLOYMENT & CONSUMER SPENDING |
| 3.4 | HOUSEHOLD CONSUMPTION |
| 3.5 | HOUSING & CONSTRUCTION |
| 3.6 | STERLING |
| 3.7 | CONCLUSIONS |
| 4 | THE BUILDING CHEMICALS MARKET |
| 4.1 | MARKET STRUCTURE AND DEFINITION |
| 4.1.1 | Market Structure |
| 4.1.2 | Definitions |
| 4.2 | MARKET SIZE AND TRENDS |
| 4.2.1 | The Market for Building Chemicals |
| 4.2.2 | Future Prospects |
| 4.3 | MARKET MIX |
| 4.4 | IMPORTS AND EXPORTS |
| 4.5 | KEY CONSTRUCTION MARKET INFLUENCES |
| 4.5.1 | Construction Output |
| 4.5.2 | Sectoral Output |
| 5 | BUILDING CHEMICALS PRODUCTS |
| 5.1 | DEFINITION OF PRODUCT COVERED BY REPORT |
| 5.2 | PRODUCT MIX |
| 5.3 | SEALANTS |
| 5.3.1 | Background |
| 5.3.2 | Types Of Sealants Covered By The Report |
| 5.3.3 | Applications Of Sealants |
| 5.3.4 | Suppliers Of Sealants |
| 5.3.5 | Distribution Structure for Sealants |
| 5.4 | ADMIXTURES |
| 5.4.1 | Background |
| 5.4.2 | Market Mix |
| 5.4.3 | Types of Admixtures |
| 5.4.4 | Supply of Admixtures |
| 5.5. | MORTARS, RENDERS AND GROUTS |
| 5.5.1 | Uses and Applications |
| 5.5.2 | Market Size |
| 5.5.3 | Product Types |
| 5.5.4 | Refurbishment Products |
| 6 | SUPPLIERS |
| 6.1 | BACKGROUND |
| 6.2 | MARKET STRUCTURE |
| 6.2.1 | Supply to Merchants And Distributors |
| 6.2.2 | Direct Supply to End Users – Limited Range |
| 6.3 | MARKET SHARES |
| 6.4 | COMPANY PROFILES |
| 6.4.1 | Major Suppliers |
| 6.4.2 | Smaller Companies |
| 7 | DISTRIBUTION OF BUILDING CHEMICALS |
| 7.1 | GENERAL STRUCTURE |
| 7.1.1 | Supply of Sealants |
| 7.1.2 | Supply and Distribution of Admixtures |
| 7.1.3 | Supply and Distribution of Mortars, Renders & Grouts |
| 7.2 | SPECIALIST DISTRIBUTORS |
| 7.3 | BUILDERS MERCHANTS |
| 7.3.1 | Builders’ Merchants Market Shares |
| 7.3.2 | Builders’ Merchants Supply of Building Chemicals |
| 7.4 | DIRECT SUPPLY |
| 8 | END USE SECTORS |
| 8.1 | OVERVIEW |
| 8.2 | HOUSEBUILDING |
| 8.2.1 | Size Of House Building Market |
| 8.2.2 | Major House Builders |
| 8.2.3 | Value of Housebuilding to the Construction Industry |
| 8.2.4 | Housebuilding Market Outlook |
| 8.2.5 | Use of Chemicals in Housebuilding Market |
| 8.3 | THE CIVIL ENGINEERING MARKET |
| 8.3.1 | Contractor’s Output in the Engineering Market |
| 8.3.2 | Use of Building Materials Civil Engineering Market |
| 8.3.3 | Building Chemicals Used in Civil Engineering |
| 8.4 | READY MIX CONCRETE MARKET |
| 8.4.1 | Structure Of Ready Mix Market |
| 8.4.2 | Background Of Ready Mixed Concrete Market |
| 8.4.3 | Major Uses Of Ready Mixed Products |
| 8.4.4 | Building Chemicals Used In Ready Mix Manufacture |
| 8.5 | CONCRETE REPAIR AND REFURBISHMENT |
| 8.5.1 | Background For Mortars Renders And Concrete Repair Products |
| 8.5.2 | Market Structure |
| 8.5.3 | Development Of Market |
| 8.5.4 | Non-Structural Use of Building Chemicals |
| 8.6 | OTHER MARKET APPLICATION AREAS |
| 8.6.1 | Main Areas Of Use |
| 9 | FUTURE PROSPECTS |
Tables and Charts
| TABLE 1 | UK BUILDING CHEMICALS MARKET – 1997-2008 BY VALUE (£M MSP) |
| CHART 2 | INTEREST RATES AND INFLATION (CPI) FROM 1990-2006 |
| CHART 3 | PDI & SAVINGS RATIO AT CURRENT PRICES 1990-2006 |
| TABLE 4 | EXCHANGE RATE FLUCTUATIONS 1997-2006 - THE POUND STERLING TO THE DOLLAR, AND THE EURO, SPOT RATES |
| TABLE 5 | UK BUILDING CHEMICALS MARKET – 1997-2008 BY VALUE (£M MSP) |
| TABLE 6 | IMPORTS AND EXPORTS OF ALL BUILDING MATERIALS AND COMPONENTS: 1994-2003 (£M) |
| TABLE 7 | CONSTRUCTION NEW WORK OUTPUT BY SECTOR 1993-2004 (£ BILLION) AT CURRENT PRICES |
| CHART 8 | RMI WORK AS A PERCENTAGE OF TOTAL CONSTRUCTION OUTPUT IN 2003: |
| TABLE 9 | BUILDING CHEMICALS PRODUCT MIX 2004 |
| TABLE 10 | SEALANT APPLICATION MARKET MIX (%) |
| TABLE 11 | APPLICATION MARKET MIX FOR ADMIXTURES IN 2004 |
| TABLE 12 | MORTARS, RENDERS AND GROUTS APPLICATION MARKET MIX |
| TABLE 13 | MARKET SHARES OF MANUFACTURERS - 2004 |
| TABLE 14 | SHARE BY CHANNEL - SEALANTS |
| TABLE 15 | SHARE BY CHANNEL - ADMIXTURES |
| TABLE 16 | SHARE BY CHANNEL - MORTARS RENDERS AND GROUTS |
| CHART 17 | MERCHANTS MARKET SHARES 2003 |
| TABLE 18 | BUILDING CHEMICAL END USE SECTOR MIX - 2004 |
| TABLE 19 | PRIVATE SECTOR HOUSE BUILDING COMPLETIONS 1996-2007 – GREAT BRITAIN (‘000 DWELLINGS) |
| TABLE 20 | MARKET SHARE OF THE LEADING HOUSEBUILDERS BY VOLUME 20031 |
| TABLE 21 | UK VALUE OF HOUSEBUILDING – CONTRACTORS OUTPUT AT CURRENT PRICES (£ MILLION) 1996 - 2003 |
| TABLE 22 | CONTRACTOR’S OUTPUT BY TYPE OF WORK (PUBLIC & PRIVATE INFRASTRUCTURE) 2003 BY VALUE (£M). |
| TABLE 23 | UK NHS SPENDING – 2003-2008 (£M) |
Text © 2005 AMA Research
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Last updated by Amanda Porteous 2005
