Recovery in the US house building market will help increase demand for insulation materials by 7.4% annually from a weak 2009 base to USD 10.2 bn in 2014, according to a recently published report from US market researchers Freedonia (Cleveland, Ohio; www.freedoniagroup.com). “Insulation” also says that consumption will benefit from increased production of major appliances and transportation equipment.

Foamed plastic and glass fibre are by far the two leading insulation products in use and together accounted for more than 90% of demand in 2009. Consumption of foamed plastic insulation materials is forecast to increase by 5.3% annually to USD 4.4 bn in 2014, the researcher said. While gains in demand were slight in the 2004 - 2009 timeframe, foamed plastic insulation did not register the same sharp decline as glass fibre in that period, reflecting the fact that foamed plastic insulation is less heavily concentrated in residential markets.

Freedonia says that, traditionally, residential markets have consumed the largest portion of insulation demand in value terms, often accounting for 40% or more of the total. However, the sharp drop in new home construction, particularly single-family homes, from 2006 to 2009 caused a steep reduction in demand. As a result, residential markets accounted for only 29% of total insulation demand in 2009.

While small in value terms, cellulose insulation is forecast to post the fastest growth in demand up to 2014, increasing more than 14% annually to almost USD 300m, Freedonia said. The environmental and performance advantages of cellulose insulation will help increase demand, although the primary driver will be the strong rebound in new housing construction. Consumption of reflective insulation and radiant barrier materials is expected to increase almost 10% annually to USD 235m in 2014, the report says.