Glass demand in China to rise
Demand for flat glass in China is expected to climb 8.6 percent per year through 2011 to 2.2 billion square meters, according Flat Glass in China, a Freedonia study released Dec. 5. Measured in value, flat glass demand will expand 15 percent per year to about $1 billion, driven by a shift in the mix toward higher value fabricated glass in many applications.
Float glass, the largest primary flat glass segment, will continue to make inroads against drawn and rolled glass, and will comprise 87 percent of total demand in 2011, according to the study.
“Float glass production is expected to climb about 7 percent per year between 2008 and 2011, the expected gains are mostly supported by healthy domestic construction market conditions that are expected to continue after the 2008 Olympics,” says Linda Li, industry analyst, Freedonia Group Inc., Beijing. “However, a number of constraining factors are expected to prevent stronger growth, including rising energy costs, slowdowns in the motor vehicle market, the new building construction market and some related industries such as furniture and appliances.”
Fabricated flat glass including insulating glass, tempered glass, laminated glass, mirrors and other specialty products, accounted for more than 19 percent of overall Chinese flat glass demand in volume terms in 2006, according to the study. Demand for fabricated flat glass will account for more than 27 percent of overall flat glass demand.
The architectural market is the largest outlet for flat glass, accounting for 86 percent of total demand by area in 2006, the study states.
“An estimated 5 percent of all glass used in new building construction in China is used for facades, curtain walls and skylights, measured in volume terms,” says Evan Yan, project director, Freedonia.
Currently, about 25 percent to 30 percent of total Chinese float glass production meets Western standards, Li says. “This percentage is expected to reach 40 percent by 2011, following continuing foreign investment in the Chinese flat glass industry and government support to improve quality standards.”
High-performance float glass accounts for about 20 percent to 25 percent of total float glass production (see numbers below for rough estimates based on available information).
|Total float glass production in millions of square meters|| |
High-performance float glass production
Percent of high-performance float glass
The Chinese flat glass market will outpace growth in all other parts of the world, driven by healthy gains in building construction activity as industrialization efforts continue and income levels rise, according to the study.
“Nonresidential building construction expenditures are expected to grow, rising 8.6 percent annually through 2011, stimulated by increases in consumer spending, accommodative government policies, and further foreign direct investment,” Li says.
Government efforts to further increase average per capita living space, sustain strength in foreign direct investment, quicken growth in motor vehicle production, and stimulate product innovation in the electronic display industry also will contribute to flat glass gains, the study states.
“Residential building construction activity will advance at an 8.1 percent annual pace through 2011, spurred by government efforts to privatize home ownership,” Li says. “The privatization of home ownership has seen a dramatic trend in the construction sector, as people now look to spend their increasingly high incomes on the real estate market as they gain ownership of their homes.”
In 2006, exports accounted for 20 percent of total float glass production, Yan says. “This percentage is expected to rise to 25 percent to 30 percent by 2011.”
—By Sahely Mukerji, managing editor, Glass Magazine