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March 11, 2008 10:01 ET

Key Challenges and Issues Facing the US Insulation Market

LONDON, UNITED KINGDOM--(Marketwire - March 11, 2008) - Reportlinker.com announces that a new market research report related to the Home improvement industry is available in its catalogue.

US Insulation Market

US demand to grow nearly 6% annually through 2012

US demand for insulation materials is projected to exceed $11 billion in 2012 on yearly growth of almost six percent. Advances will be supported by a rebound in the residential market, especially in new housing construction. New applications of insulation will benefit as housing starts recover from their depressed level in 2007, while retrofit uses of insulation will be powered by homeowners seeking to conserve energy and reduce heating and cooling costs. Although unit price increases for insulation materials are expected to moderate from their 2002-2007 pace, the growth in unit demand will more than offset the slower price gains. While not as ebullient as the residential market, nonresidential building construction will offer opportunities for insulation products, with greater insulation use per structure and upgrades of insulation for existing buildings supporting demand. Modest increases in new building construction expenditures over the forecast period will boost insulation demand in new applications.

Fiberglass to remain dominant material utilized

Fiberglass insulation is forecast to remain the predominant insulation material used in the US, representing more than onehalf of demand in 2012 in terms of both dollar value and material weight. Demand increases for fiberglass insulation are expected to be about six percent per annum to roughly $6 billion. Gains will be fostered by more intensive use of fiberglass insulation per new housing unit, sparked by expanded concerns about energy efficiency, as well as by continuing product developments that improve ease of installation.

Foamed plastic insulation is projected to remain the second largest insulation material segment. A relatively high-cost insulation, its market share in terms of weight is only about two-thirds that in terms of dollar value. Growth for foamed plastic insulation will be spurred by new residential construction as well as uses in appliances and transportation equipment. Foamed plastic insulation is widely used in nonresidential building markets in both spray-on and board forms, and demand is forecast to accelerate from the 2002-2007 pace, although it will be below the average for the material overall. Other insulation materials, including reflective insulation and radiant barriers, cellulose, mineral wool, perlite, vermiculite, cotton and other materials, all have niche applications. Reflective insulation and radiant barriers are forecast to enjoy the fastest gains, albeit from a small base. New housing construction will support growth, as these products increase their market penetration. Reflective insulation and radiant barriers also find use in metal buildings and other nonresidential structures, as well as in pipe wrap, appliances and duct insulation.

Study coverage

It presents historical demand data (1997, 2002, 2007) plus forecasts (2012, 2017) by material, product, market, and region of the US. The study also considers market environment factors, evaluates market share data and profiles 35 industry participants.

INTRODUCTION xi

I. EXECUTIVE SUMMARY 1

II. MARKET ENVIRONMENT 4

General 4

Macroeconomic Outlook 5

Demographic Trends 10

Consumer Spending Trends 12

Consumer Financing Trends 14

Building Construction Trends 18

Residential Construction 20

Housing Starts 23

Housing Stock 26

Improvements & Repairs 30

Nonresidential Construction 31

Office & Commercial Construction 33

Institutional Construction 34

Industrial Construction 35

Transportation & Other Building Construction 35

Improvements & Repairs 36

Manufacturing Outlook 37

Pricing 40

Historical Trends 43

Foreign Trade 46

World Insulation Overview 48

III. OVERVIEW 50

General 50

R-Values 51

Material Variations in Thermal Resistance 52

Environmental & Regulatory Issues 55

Energy Efficiency Considerations 55

Indoor Air Quality Issues 57

Renewable Resources & Recycling Considerations 58

Materials-Based Considerations 61

Insulation Demand 63

IV. PRODUCTS 66

General 66

Fiberglass 68

Materials 69

R-Values 70

Product Forms 71

Markets 75

Residential Construction 76

Nonresidential Construction 77

Industrial & HVAC Equipment 78

Other Markets 79

Foamed Plastics 80

Materials 80

R-Values 81

Product Forms 82

Markets 82

Resins 84

Rigid Urethane 85

Products 86

Markets 88

Polystyrene 90

Products 91

Markets 92

Other Foamed Plastics 95

Cellulose 96

Product Forms 98

Markets 100

Mineral Wool 101

Product Forms 104

Markets 106

Reflective Insulation & Radiant Barriers 108

Product Forms 110

Markets 111

Other Insulation Products 114

Materials 115

Perlite 116

Vermiculite 117

All Other Materials 117

Product Forms 120

Markets 121

V. MARKETS 124

General 124

Demand by Market Value 125

Demand by Insulation Value 127

Residential Construction 130

Materials 130

Applications 133

New Housing 135

Attic Reinsulation 139

Residential Improvement & Replacement 141

Nonresidential Construction 143

Materials 144

Applications 147

Commercial 149

Institutional 150

Office 150

Industrial 150

Other Nonresidential 151

Industrial & HVAC Equipment 152

Materials 152

Applications 155

Industrial Equipment 156

HVAC Equipment 156

Other Insulation Markets 157

Materials 157

Applications 159

Appliances 160

Transportation Equipment 160

All Other Applications 161

VI. REGIONAL DEMAND 162

General 162

Regional Demographic & Economic Trends 163

Regional Demographic Trends 164

Regional Economic Trends 166

Regional Construction Trends 167

Regional Housing Trends 169

Regional Insulation Demand 171

Northeast 174

New England 176

Middle Atlantic 177

Midwest 178

East North Central 180

West North Central 181

South 182

South Atlantic 184

East South Central 186

West South Central 187

West 188

Mountain 190

Pacific 191

VII. INDUSTRY STRUCTURE 193

General 193

Industry Composition 194

Market Share 198

Owens Corning 199

Johns Manville 199

CertainTeed 200

Dow Chemical 200

Knauf 200

Guardian Industries 201

Atlas Roofing 201

Manufacturing & New Product Development 201

Competitive Strategies 203

Marketing & Distribution 206

Acquisitions & Divestitures 209

Cooperative Agreements 211

Company Profiles 213

Armacell International GmbH 214

Atlas Roofing, see Hood

BASF AG 216

Bayer AG 220

Berkshire Hathaway Incorporated 222

Bridgestone Corporation 229

Building Materials Corporation of America 231

Carlisle Companies Incorporated 232

Carpenter Company 236

CertainTeed Corporation, see Saint-Gobain

Covertech Fabricating Incorporated 238

Dow Chemical Company 240

Dryvit Systems Incorporated, see RPM

Dyplast Products LLC 245

Evonik Degussa Corporation, see RAG

Falcon Foam, see Hood

Fi-Foil Company Incorporated 246

Firestone Building Products Company, see Bridgestone

GAF Materials Corporation, see Building Materials

Corporation of America

GBP Silvercote Incorporated, see Guardian Industries

Grace (WR) & Company 248

Guardian Industries Corporation 249

Homasote Company 253

Hood Companies 254

Hunter Panels LLC, see Carlisle Companies

Industrial Insulation Group, see Berkshire Hathaway

Innovative Energy Incorporated 256

Innovative Insulation Incorporated 258

Insulation Solutions Incorporated 259

Insulfoam LLC, see Carlisle Companies

Johns Manville Corporation, see Berkshire Hathaway

Knauf Gips KG 261

Louisiana-Pacific Corporation 264

Materis Holding Luxembourg SA 266

Owens Corning 269

Pactiv Corporation 272

ParexLahabra Incorporated, see Materis Holding

Pittsburgh Corning Corporation, see PPG Industries

Polyair Inter Pack Incorporated 274

PPG Industries Incorporated 276

Pregis Corporation 277

Premier Building Systems, see Carlisle Companies

RAG AG 278

Reflectix Incorporated, see Sealed Air

Rockwool International A/S 280

Roxul Incorporated, see Rockwool International

RPM International Incorporated 282

Saint-Gobain 284

Sealed Air Corporation 287

Sloss Industries Corporation, see Walter Industries

Sto AG 288

Svenska Cellulosa AB 290

Tegrant Corporation 291

Thermafiber Incorporated 292

US GreenFiber LLC, see Louisiana-Pacific

Walter Industries Incorporated 294

Additional Companies Mentioned in the Study 296

LIST OF TABLES

SECTION I -- EXECUTIVE SUMMARY

SECTION II -- MARKET ENVIRONMENT

1 Macroeconomic Indicators 9

2 Population & Households 12

3 Personal Consumption Expenditures 14

4 Consumer Financing Environment, 1997-2007 17

5 Building Construction Expenditures 20

6 Residential Building Construction Expenditures 22

7 Housing Indicators 26

8 Housing Stock by Type 29

9 Residential Improvement & Repair Expenditures 31

10 Nonresidential Building Construction Expenditures 33

11 Nonresidential Building Improvement & Repair Expenditures 37

12 Manufacturers' Shipments 40

13 Average Insulation Prices 43

14 Insulation Market, 1997-2007 45

15 Insulation Foreign Trade 47

SECTION III -- OVERVIEW

1 Insulation R-Values by Material 54

2 Insulation Demand by Value 65

SECTION IV -- PRODUCTS

1 Insulation Demand By Material 67

2 Fiberglass Insulation Demand by Product Form 75

3 Fiberglass Insulation Demand by Market 76

4 Foamed Plastic Insulation Demand by Market 84

5 Foamed Plastic Insulation Demand by Resin 85

6 Rigid Urethane Foam Insulation Demand by Product 88

7 Rigid Urethane Foam Insulation Demand by Market 90

8 Polystyrene Foam Insulation Demand by Product 92

9 Polystyrene Insulation Demand by Market 94

10 Other Foamed Plastic Insulation Demand by Market 96

11 Cellulose Insulation Demand by Product Form 100

12 Cellulose Insulation Demand by Market 101

13 Mineral Wool Insulation Demand by Material 104

14 Mineral Wool Insulation Demand by Product Form 106

15 Mineral Wool Insulation Demand by Market 108

16 Reflective Insulation & Radiant Barrier Demand By Type 110

17 Reflective Insulation & Radiant Barrier Demand by Market 114

18 Other Insulation Demand by Material 116

19 Other Insulation Demand by Product Form 121

20 Other Insulation Demand by Market 123

SECTION V -- MARKETS

1 Insulation Demand by Market Value 126

2 Insulation Demand by Insulation Value 129

3 Residential Construction Market for Insulation by Material 133

4 Residential Construction Market for Insulation by

Application 135

5 New Housing Applications for Insulation 139

6 Residential Attic Reinsulation Applications for Insulation 141

7 Residential Improvement & Replacement Applications

for Insulation 143

8 Nonresidential Construction Market for Insulation by Material 147

9 Nonresidential Construction Market for Insulation

by Application & Type 149

10 Industrial & HVAC Equipment Markets for Insulation

by Material 154

11 Industrial & HVAC Equipment Markets for Insulation by

Application 155

12 Other Insulation Markets by Material 158

13 Other Insulation Markets by Application 159

SECTION VI -- REGIONAL DEMAND

1 Population by Region 165

2 Gross Domestic Product by Region 167

3 Construction Expenditures By Region 169

4 Regional Home Sales & New Housing Starts 171

5 Insulation Demand by Region 173

6 Northeast Insulation Demand by Subregion & Market 176

7 Midwest Insulation Demand by Subregion & Market 180

8 South Insulation Demand by Subregion & Market 184

9 West Insulation Demand by Subregion & Market 190

SECTION VII -- INDUSTRY STRUCTURE

1 Insulation Sales By Company, 2007 197

2 Selected Acquisitions & Divestitures 210

3 Selected Cooperative Agreements 212

LIST OF CHARTS

SECTION II -- MARKET ENVIRONMENT

1 Year of Construction of Housing Stock, 2007 29

2 Insulation Market, 1997-2007 45

SECTION IV -- PRODUCTS

1 Insulation Demand by Material, 2007 68

SECTION V -- MARKETS

1 Insulation Demand by Market Value, 2007 127

2 Insulation Demand by Insulation Value, 2007 129

SECTION VI -- REGIONAL DEMAND

1 Insulation Demand by Region, 2007 173

SECTION VII -- INDUSTRY STRUCTURE

1 Insulation Market Share by Company, 2007 199

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US Insulation Market

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