Joe Harder looks at gypsum and wallboard market trends over the coming decade, highlighting some of the findings of his company’s recently released market report Plasterboard Industry Focus 2030.
The global plasterboard market has experienced supply and demand changes over the past few years, as external factors such as the Covid-19 pandemic affect its underlying steady growth. OneStone Consulting has recently undertaken research into the sector, with a view to the publication of a new multi-client sector report: Plasterboard Industry Focus 2030. As the title suggests, there are projections for 2025 to 2030, with recent historical data for the years 2018 to 2021. The report covers several aspects of the market, including plasterboard demand, production, capacity changes and gypsum sources.
Market size
OneStone Consulting’s analysis suggests that the global plasterboard market will grow from US$17.5bn in 2021 to US$21.7bn in 2025 at a compound annual growth rate (CAGR) of 5.5%. Between 2025 and 2030 it will then grow at a slightly slower CAGR of 5.3% to reach US$28.1bn in 2030.
Across the major economies it is quite surprising to see the United States, China and the EU with similar plasterboard market values in 2021, 2025 and 2030 (Figure 2). However, this is not representative of board production values, as prices will be lowest in China, more in the US and highest in the EU. Japan’s market is unusual in that it will decrease in wallboard output. The rest of the World (RoW) will see the most rapid growth in market value.
Board production
Figure 2 shows plasterboard production for 2018 and 2021, with forecasts for 2025 and 2030. Between 2018 and 2021 production averaged just under 11,000Mm2/yr. In 2020 it fell from a growth rate of 3.9% to just 0.2%. 2021 saw a recovery to the prior level after the worst of the Covid-19 pandemic. By 2025, our research estimates that the volumes will rise by a CAGR of 2.2%, with some variation year on year to reach production of over 12,000Mm2/yr in that year. After this point plasterboard volume growth is expected to rise at a slightly lower CAGR of 1.5% to exceed 13,500Mm2 in 2030.
Plasterboard capacity and utilisation
Between 2018 and 2020 there was relatively little growth in plasterboard capacity (Figure 4). In the coming years we see a similar increase for capacity as reported for wallboard production itself. Combining these figures, we can calculate capacity utilisation rates (Figure 5). Globally these have hovered at around 70 - 75%, although this is skewed by China, which has an appreciably higher rate than the global average. The utilisation rate is expected to be broadly stable in the periods to 2025 and 2030. This is not too surprising given the steady anticipated rises in production and capacity seen elsewhere in the forecast.
Gypsum demand from plasterboard producers
The demand for gypsum from the global plasterboard sector is forecast to rise to over 109Mt in 2030, from 94.1Mt in 2021. It must be remembered that gypsum demand is not simply a function of the square meterage produced, as board thickness and density trends must also be considered. OneStone Consulting has done so carefully in its research. As part of its findings, a mixture of national data, producer and plant data with some estimates, has shown that the race towards ever lower wallboard weights has now slowed significantly compared to the mid 2010s. This is partly due to the disadvantages of light-weight walboard, including higher fragility and lower fire resistance, making it unsuitable in some applications. This is not to say that light-weight wallboard is going away, but rather that it has now filled much of the niche available to it.
Gypsum supply outlook
There are three sources of gypsum for wallboard production that will continue to supply the global plasterboard sector: Natural, synthetic and recycled.
On the global scale, most of the gypsum that will be supplied to the plasterboard sector in the period to 2030 will remain synthetic, almost entirely in the form of flue gas desulphurisation (FGD) gypsum from coal-fired power plants. This is not the case everywhere, but is strongly skewed by the high proportions of FGD gypsum used in the Chinese plasterboard sector. Mining will continue to be the second most important source of gypsum for plasterboard production worldwide, while recycled gypsum is forecast to triple in volume to around 6.5% of all supplies by 2030 (Figure 7).
Switching to the EU27+1
There are 20 countries that produce plasterboard in the EU. When looking at recent market trends - also including the ex-Member State the UK - we see lower growth between 2018 and 2019 than for the world as a whole, followed by a sharp contraction of 2.8% in 2020. In 2021, there was a recovery, but - again - at 2.5% this was less pronounced than in the global picture. For the period to 2025 we can expect a CAGR of 1.6% to reach production of 1809Mm2. In the period to 2030, EU+UK wallboard production will grow at a CAGR of 1.5% to reach 1954Mm2.
In terms of capcacity, there has been zero new capacity in the EU and UK since 2018. However there are now projects announced, with a CAGR of 1.5% to 2627Mm2/yr by 2025 and a CAGR of 1.3% between 2025 and 2030. This leads to an EU+UK capacity of 2785Mm2/yr in 2030, around 14.7% more than the 2427Mm2/yr the same region held in 2021.
In terms of plasterboard utilisation rates, the EU is expected to be below the global average. In 2020 it was 68.4%. This is expected to rise slowly to 69.3% in 2025 and to 70.1% in 2030. This is a good demonstration that, whenever you build new capacity, it does not translate through to 100% production for some time. Demand for gypsum raw materials will rise in line with wallboard production in
Europe, as board weights are not expected to change. The closure of some power plants, particularly in Germany, is going to put large pressure on synthetic gypsum supplies in the EU.
However, this is not the whole story, as significant quantities of FGD have been temporarily landfilled in Germany, Poland and elsewhere due to power plants being unable to sell it at the time of production. Germany alone has accumulated 13-15Mt of such FGD gypsum since 2000. Some owners have already started to supply this material to the plasterboard sector, alongside claims that there is enough to supply the sector for 7 - 8 years. However, I suspect that there is even more recoverable FGD gypsum out there.
In Europe the majority of gypsum supplies will be natural gypsum in 2030. Synthetic gypsum will decline massively, even when one takes into account the temporarily landfilled reserves. Meanwhile, the proportion of recycled gypsum could rise to as much as 20.3% of all plasterboard supplies.
Conclusions
This article was based on findings from OneStone Consulting’s recent market report Plasterboard Industry Focus 2030, which contains information on many aspects of the wallboard market in the time-frame 2018 - 2021, with forecasts to 2025 and 2030. It covers 72 plasterboard-making nations.
