Coil Coating

The U.S. coil coating market over the past five years has experienced significant shifts in market structure, competitive environment, and end use demand which have all lead to an overall market decline.

The coil coating industry serves industry sectors including transportation, construction, business, containers and consumer products. Transportation and consumer products have contributed to most of this market decline with over an 80 percent drop in demand from 2004 to 2005 for pre-coated coil. However, the construction segment of the pre-coated coil industry has remained relatively steady in terms of demand which involves applications such as metal roofing and cladding, ceiling systems, trim gutter stock and curtainwall and window system framing. This stability within the construction segment can be attributed to innovative insulated metal walls becoming a preferred product for commercial industrial applications as well as addressing energy codes. Non-residential building is expected to remain steady through 2010 and continue to represent a large portion of demand in the coil coating industry.

Historically, the U.S. coil coating market has always had excess capacity, however in recent years; the situation has become increasingly worse with new capacity additions by captive producers and integrated steel mills disrupting the coil coating industry. Capacity for the overall coil coating industry is expected to increase from 7,400,000 tons in 2006 to almost 8,000,000 tons in 2007 with demand at less than 4,000,000 tons; this is almost a 50 percent difference in excess capacity as compared to demand.

Competition is expected to become quite fierce in the next couple of years as suppliers battle within the U.S. for non-residential customers from existing sources and continue to compete with imports.