The industry recovered strongly after the recession as pent-up demand increased revenue
Los Angeles, CA (PRWEB) May 07, 2012
Geosynthetics first came into widespread use in the late 1960s. Geosynthetic products are primarily used for soil reinforcement and containment for waste treatment facilities, mining, road and building construction. In addition, geosynthetics are used in agribusiness and for water conservation purposes. The Geosynthetics Manufacturing industry is valued at $2.1 billion in 2012, representing average annual growth of 0.3% since 2007. According to IBISWorld industry analyst Caitlin Moldvay, despite its array of applicable uses, geosynthetics manufacturing has been adversely affected by the downturn in the construction sector, which weakened demand for geosynthetics used for structural support projects. Moreover, despite federal funding provided by the American Recovery and Reinvestment Act, lower tax receipts during the recession and slow recovery period resulted in decreased government spending on highway, road and bridge construction, another prominent area of demand for the industry.
Industry revenue was further weakened by decreased mining activity during the recession. As a result, industry revenue contracted 2.3% and 4.5% in 2008 and 2009, respectively. In the years since the recession, the Geosynthetics Manufacturing industry has begun to recover, with expected revenue gains of 4.9% during 2012. Revenue growth has been fostered by rising demand for geomembranes, which are increasingly used for waste containment at US landfills. Moreover, the mining and construction sectors are expected to grow moderately during the year, which will foster greater growth for geosynthetics to minimize erosion and reduce environmental contaminants.
Over the next five years, the Geosynthetics Manufacturing industry is expected to post stronger gains. Between 2012 and 2017, industry revenue is forecast to recover strongly. “Recovery in the non-residential construction sector will lead to improved demand for geosynthetic products in building construction projects,” said Moldvay. Moreover, the industry will benefit from rising tax revenue, which will enable greater government spending on transportation infrastructure projects. Furthermore, improved growth prospects for the mining sector and waste treatment facilities are also expected to drive revenue growth. Additionally, the industry stands to benefit over the next five years, from the potential passage of environmental legislation requiring coal ash containment sites to utilize geomembrane liners.
The Geosynthetics Manufacturing industry has a low level of concentration, reflecting the fragmented nature of the industry. The top four companies in the industry together make up less than 40.0% of revenue. Despite the existence of prominent companies, no one player has a market share of more than 10.4%. There are many types of geosynthetics and diverse buying markets, which makes it difficult for individual firms to grab a large portion of industry market share. For more information, visit IBISWorld’s Geosynthetics Manufacturing in the US industry report page.
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IBISWorld industry Report Key Topics
This industry includes companies that domestically manufacture geosynthetic products. Geosynthetic products are primarily made from plastic products such as polyolefins and polyester, although rubber, fiberglass and other materials may also be used. Geosynthetic products are used for reinforcement, filtration and containment for waste treatment, mining, agribusiness and building, road and bridge construction.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
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Barriers to Entry
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