June 2006

World Drywall and Building Plaster Demand to Reach 8.2 Billion Square Meters in 2009

World demand for drywall (also known as plasterboard or wallboard) is forecast to expand 4.4 percent per year through 2009 to 8.2 billion square meters. Gains will vary greatly by region, depending on a host of factors such as building construction and economic growth prospects, as well as trends in local construction techniques. Gypsum-based building plaster sales will rise a slower 3.7 percent per year through 2009. In most developed countries (with some exceptions in Western Europe), drywall represents by far the dominant market for gypsum. In developing countries, however, the dominant use for gypsum is as a cement additive. On a value basis, drywall is of far greater significance than gypsum-based building plasters at the global level, and is therefore the main focus of this study. These and other trends are presented in World Drywall & Building Plasters, a new study from The Freedonia Group, Inc., a Cleveland-based industry research firm.

Demand for drywall is concentrated in North America, which accounted for 54 percent of global sales in 2004. However, through 2009, market gains in North America will significantly lag all other regions, primarily due to maturation in the large U.S. market as well as declines in U.S. housing starts. Drywall sales prospects in the Asia/Pacific region will be particularly strong, especially when excluding Japan. China and India will perform especially favorably, with countries such as Indonesia, Thailand and Vietnam also registering healthy gains in demand. The Japanese drywall market, although registering weak gains through 2009, will recover from the stagnant performance of the past decade. Gains will be particularly strong in countries such as Portugal and Spain, where drywall use is increasingly being substituted for traditional wet construction techniques. Western Europe will also remain the world’s largest market for gypsum-based building plasters through 2009.

Drywall based on synthetic gypsum will continue to account for an increasing share of global demand through 2009. This will allow drywall companies to locate plants closer to urban population centers, thereby lowering product transportation costs. The most popular type of synthetic gypsum used in drywall is produced as a byproduct of flue gas desulfurization systems at coal-fired power plants.

World Drywall & Building Plasters (published 04/2006, 220 pages) is available for $5,300 from The Freedonia Group, Inc., 767 Beta Drive, Cleveland, OH 44143-2326.

AISI Construction Codes and Standards Program Realigned

The Construction Market Committee of the American Iron and Steel Institute has realigned its building codes and standards program. AISI’s codes and standards program is a core asset in addressing critical issues in the construction marketplace. It provides support for the AISI Construction Market programs by ensuring that building codes for steel construction products reflect state-of-the-art industry practices and are technically sound, permitting the proper and safe use of steel as the material of choice for the built environment. AISI is recognized internationally for its expertise and effectiveness in working cooperatively with building codes and construction standards organizations in both the United States and Canada.

The realigned program allows AISI to rebuild its core expertise in fire, seismic and wind load design criteria in order to strengthen and maintain the competitive design of steel construction. To meet program objectives, AISI has announced the following staff changes:

Robert J. Wills, P.E. has been promoted to director, construction codes and standards. He replaces Program Director Hank Martin, P.E., who retired in December 2005. In this new role, Wills will guide steel industry activity related to the development processes for national, state and local building codes and standards organizations.

Farid Alfawakhiri, Ph.D., P.Eng., is AISI’s new senior engineer, construction codes and standards, with primary responsibility for fire-protection standards and related research/education programs.

Bonnie E. Manley, P.E. joined AISI as regional director, construction codes and standards, to fill the vacancy created by Robert Wills’ promotion. Her primary focus will be the continuous improvement of structural, material and seismic design provisions in building codes and standards.

Tilt-Up Concrete Association Reports New Record Sales for Tilt-Up

2005 was a record year for tilt-up construction sales in the United States, according to the Tilt-Up Concrete Association, Mt. Vernon, Iowa. With more than 753 million square feet of buildings (approximately 301 million square feet of wall panels) constructed using Tilt-Up in 2005, and approximately 664 million square feet of buildings (approximately 265 million square feet of wall panels) constructed in 2004, the industry experienced a growth rate of 13 percent in 2005.

The annual growth rate is based on sales of lifting inserts as reported by the major manufacturers of Tilt-Up accessories. Lifting inserts are designed for a given thickness of panel and have a maximum lifting capacity. Using a series of calculations that account for under-utilization and other factors, the total square foot of panels lifted, based on the connectors sold, is calculated. Then, using an industry-accepted ratio for low-rise buildings of wall-to-floor area of 0.40, the square foot of floor area enclosed by Tilt-Up wall construction is estimated.

Wallboard Shipment Volume Announced for 1Q 2006

According to statistics compiled by the Gypsum Association, the United States gypsum board industry shipped a total of 9.499 billion square feet of material during the first calendar quarter (January–March) of 2006. During the same period, Canadian manufacturers shipped 906 million square feet of material.

Builder Confidence Declines in May

Rising mortgage rates, deepening affordability issues and the retreat of investors/speculators from the marketplace are prompting single-family home builders to further adjust their perspectives on the new-home market, according to the National Association of Home Builders/Wells Fargo Housing Market Index for May, released today. The HMI declined six points from an upwardly revised reading in the previous month to hit 45 for the latest report, its lowest mark since mid-1995.

"Based on historical experience, particularly the 1994–1995 episode, the pattern of movement in the HMI is not inconsistent with the orderly cooling-down process we’re projecting for home sales and single-family housing starts in 2006,” said NAHB Chief Economist David Seiders. "We expect new-home sales to be off by 12 percent from the record posted in 2005. Single-family starts, supported by large builder backlogs of unfilled orders and reconstruction in the wake of last year’s record-breaking hurricane season, should be down by about 7 percent from the 2005 record.”

All three component indexes declined in May. The index gauging current sales and the index gauging sales expectations for the next six months each fell five points, to 50 and 54, respectively. Meanwhile, the index gauging traffic of prospective buyers declined seven points, to 32.

The decline in builder confidence was broad-based and registered in every region this month. The HMI fell three points to 47 in the Northeast, two points to 30 in the Midwest, six points to 51 in the South and eight points to 61 in the West.

March Construction Rises 2 Percent

New construction starts in March climbed 2 percent to a seasonally adjusted annual rate of $667.6 billion, according to McGraw-Hill Construction, a division of The McGraw-Hill Companies. During the first three months of 2006, total construction on an unadjusted basis came in at $149.6 billion, up 8 percent relative to the same period a year ago.

Nonresidential building in March grew 3 percent to $182.3 billion (annual rate).

Residential building in March settled back 1 percent to $378.3 billion (annual rate).

Total construction by region for the January–March period of 2006 was the following: the West, up 15 percent; the Northeast, up 9 percent; the Midwest and South Central, each up 7 percent; and the South Atlantic, up 3 percent.

National Gypsum Announces Plans for Arizona Plant

National Gypsum Company, Charlotte, N.C., plans to build a state-of-the-art wallboard plant near Phoenix, doubling its presence in the West. The new plant will be capable of producing one billion square feet of wallboard, enough to complete 100,000 average-sized homes annually.

The company’s investment in the Phoenix/Tucson region will be approximately $140 million, and the plant is expected to be operational by mid-2008. The new plant will create approximately 100 direct and 150 indirect jobs.

The new plant will serve Phoenix, Tucson, Las Vegas, San Diego, Albuquerque, El Paso, and Los Angeles by truck. Other West Coast markets will be served by rail including Denver, Salt Lake City, Sacramento, Boise, and Seattle.

Ironclad Begins Trading

Ironclad Performance Wear Corporation began trading on the Over the Counter Bulletin Board under its new symbol "ICPW” on May 11, 2006. Ironclad merged with Europa Trade Agency Ltd. on May 8, 2006. The new company was renamed Ironclad Performance Wear Corporation.

In conjunction with the reverse merger, Ironclad raised a total of $7,321,191 of equity capital through a private placement of Common Stock units. Each unit was priced at $0.75 and included one common share and a warrant to purchase 3/4 of a common share. The warrants are exercisable at a strike price of $1 per share. Ironclad’s offering was over-subscribed, and institutional investors represented more than 96 percent of the invested proceeds.

Hyde Tools Acquires Goodell

Hyde Tools, Inc, a member of the Hyde Group, Southbridge, Mass., acquired the assets and name of Goodell, Inc., of Minneapolis, in March 2006. The completion of the transition has been accomplished and all Goodell customers are now transferred to Hyde.

Inquiries about the Goodell acquisition should be addressed to Marsha Montori, brand manager. Customer inquiries should be addressed to Abby Veshia, customer relations manager.

Scara Joins Chicago Metallic

John J. Scara has joined the Chicago Metallic, Chicago, as vice president of sales. Scara will oversee the sales organization for the company’s portfolio of metal and specialty ceiling systems.

Scara, who has been in sales 25 years, boasts more than 21 years of experience in the building materials industry.

Scara’s career spans work for such regarded manufacturers as Black & Decker Corporation and ThyssenKrupp AG.