The building materials market - France

1.2 The global market

Growth outlook:

The building materials industry generates an estimated global revenue of US$*,*** billion in ****, and is forecast to grow at an annual rate of *.**% over the period ****-**** .

Development of the global building materials market World, ****-****, in trillions of US dollars Source: ****

The global building materials market is expected to grow to USD *.** trillion by ****.

Key market players :

The leading player in the global building materials sector is France's Saint-Gobain, with estimated annual sales of $**.* billion. In *nd and *rd place are China National Building with sales of $**.* billion, and Cement Roadstone Holding with $**.* billion.

Major global players in the building materials market World, ****, sales in billions of dollars Source: ****

1.3 The domestic market

Unicem's data enable us to report on sales trends in its branches between **** and ****.

Unicem brings together the mineral extraction industries and manufacturers of construction materials (***). This trend therefore excludes non-mineral building materials, but remains fairly representative of the sector.

Between **** and ****, the market for Unicem's branches fluctuated in terms of sales. In ****, sales totaled *,*** million euros. It fell slightly in **** to *,*** million euros. However, growth was observed from **** with sales of *,*** million euros, followed by an increase in **** to *,*** million euros. In ****, sales reached their highest level in this period at €*,*** million.

Sales trends for all UNICEM branches France, ****-****, millions of euros Source: ****

Breakdown of sales by branch France, ****, % of sales Source: ****

Ready-mix concrete is the sector generating the highest sales in ****, accounting for half of Unicem's sales. Aggregates of all types (***) then account for **% of total sales. Finally, building stones are another differentiating sector, accounting for *.*% of Unicem's total sales.

Market structure France, ****, sales by destination in Source: ****

The uses are varied, but the demand sectors are mainly counted among *: the vast majority of materials are destined for public works (***), which are sectors themselves comprising distinct and varied sub-classes. The funeral industry is also a differentiating sector, accounting ...

1.4 Foreign trade

Here we consider the following aggregate: C**B - Building materials and miscellaneous mineral products.

Foreign trade in production materials France, ****-****, millions of euros Source: ****

The trade balance for this sector is largely in deficit: exports do not cover imports.

Exports and imports of building materials increased in the same proportions between **** and ****: the coverage rate remained stable at around **%. Between **** and ****, imports grew more strongly than exports, so the coverage rate has fallen in recent years.

Main source countries for imports of building materials and miscellaneous mineral products France, February **** to January ****, millions of euros Source: ****

The majority of imports come from Europe: combined imports from Spain, Italy, Germany and Belgium account for **% of French imports of building materials and miscellaneous mineral products. Imports from China account for *** million euros, or just *% of total imports.

Main countries of destination for building materials and miscellaneous mineral products exports France, February **** to January ****, millions of euros Source: ****

In terms of export destination, Germany clearly stands out. With *** million euros worth of building materials and miscellaneous mineral products, Germany is well ahead of the second largest destination, the United Kingdom, which accounts for just *% of total exports.

The main partner countries in ...

2.1 Demand for building materials largely dependent on the construction market

Demand for building materials depends largely on activity in the construction sector.

Annual production in the construction sector Europe **, ****-****, base *** in **** Source: ****

Between **** and ****, the production index for the construction industry in the European Union (***) and France has evolved differently. In the EU, the index rose from ** in **** to *** in ****, an increase of **.*%. In France, the index has evolved from *** in **** to *** in ****, remaining relatively stable over the period. However, there will be a significant drop in **** as a result of the health crisis. However, it is worth noting that the index in the EU grew more markedly between **** and ****, with an increase of *%, while in France, the most notable growth occurred between **** and ****, with an increase of *%.

Different types of building

Building work will account for *** billion euros in ****. According to the FFB, new construction accounts for **% of this total, or ** billion euros. Maintenance-renovation amounts to ** billion, or **% of work.

Breakdown by type of new construction France, end April ****, million square meters Source: ****

At the end of April ****, in terms of m*, the majority of new construction is residential (***). This corresponds to ***,*** units.

2.2 Public spending on infrastructure

Construction investment France, ****-****, billions of euros Source: ****

(***) Building construction includes real estate development.

Investment in construction stagnated after the **** crisis, and even declined between **** and ****. However, investment picked up again in ****. In fact, according toINSEE data, construction investment rose from *** billion euros in **** to *** billion euros in **** before reaching *** billion in ****.

Since ****, investment in public works has been on the rise, thanks to an accelerating recovery in local investment on the one hand, and in the private sector on the other. [***]

Local authorities account for **% of public works activity[***], and the upturn in their investments largely explains the upturn in activity. Local public investment increased between **** and ****. Indeed, communes were in the most dynamic phase of the electoral cycle, the pre-election year. The départements, which were in retreat until ****, should also increase their capital expenditure.

As a result of a sharp turnaround in building permits for new housing and a slowdown in permits for non-residential premises, private investment is likely to slow in ****. The private sector's estimated increase of +*% in value terms in ****[***] would therefore be due to a rise in costs, not volumes.

However, in ****, there will be a drop in construction investment in all sectors (***), explained ...

3.1 French production fabric

In this section, we consider the following aggregates:

**.**Z: Manufacture of plastic components for the construction industry **.**Z : Manufacture of concrete components for the construction industry **.**Z : Manufacture of plaster components for the construction industry **.**Z : Intermediaries in the wood and building materials trade **.**Z : Wholesale of timber and building materials

Breakdown of the number of establishments in the plastic, concrete and plaster building materials sectors France, ****, in number of companies Source: ****

While growth in the number of companies in the sector was irregular between **** and ****, there was a clear decline in the number of employees. In fact, digitalization is driving changes and productivity gains in the business, with the result that hiring for certain tasks (***) is slowing down.

Number of companies in the timber and building materials wholesale trade France, ****-**** Source: ****

Above, we have considered products with code **.**.A. Between **** and ****, the number of intermediary companies in the timber and building materials trade has varied.

In ****, there were *,*** companies, then this figure fell slightly to *,*** in **** (***), and in **** it reached *,*** businesses, an increase of *.**% on ****. The **** figure is the highest achieved since ****, which augurs well for growth in this market.

Number of intermediary companies in the wood and ...

3.2 Geographical distribution of business in France

Breakdown of timber and building materials wholesale companies France, ****, number of companies Source: ****

The map above can be read by color intensity: darker areas indicate a high number of wood and building materials establishments in the region concerned. Conversely, the lighter areas indicate that the region in question has few such establishments compared with the rest of the country.

There is a North/South divergence: the South has more establishments than the regions of Northern France. The regions with the most establishments in the sector are Auvergne Rhône-Alpes, Nouvelle Aquitaine, Occitanie and Ile de France, with over *,*** establishments in each of these regions.

3.3 Multinational players

Europe's leading manufacturers of building materials:

Source: ****

The Saint Gobain Group

A world leader in the building materials sector, the French Saint Gobain group also has a strong presence in France, with operations in ** countries. In ****, its worldwide sales will reach **.* billion euros, up **. *%. Saint Gobain employs ***,*** people.

By way of example, here is the breakdown of the group's revenues by business sector in ****:

Saint Gobain group revenues by business sector World, ****, % (***) Source: ****

The Vicat Group

Although the French Vicat group does not have as strong a global presence as Saint-Gobain, it too is a major sector in France. In ****, France accounted for **% of the group's total sales of *.* billion euros, or *.** billion euros for France. In France in ****, the Group had *** concrete plants, ** aggregates quarries and * cement plants.

Vicat sites worldwide World, ****, in number of sites Source: ****

In terms of breakdown by business sector, the Group is mainly present in cement distribution, with a **% share. The Group is also present in the concrete and aggregates sector, with a **% share.

Vicat Group revenues by business sector France, ****, in % of value Source: ****

3.4 A changing value chain

The value chain is divided into * stages

Extraction of raw materials Production of building materials Supply and installation Merchant distribution Development and construction

Each stage is subject to technological change:

Automation and robotization Digitization of construction *D printers E-commerce artificial intelligence and advanced data analysis across all business units.

Each of these revolutions comes into play at different stages of the value chain, helping to improve the sector's productivity. [***]

4.1 Product segmentation

Structural work/Second Oeuvre

A distinction is made between structural work and finishing work. Structural work consists of the load-bearing elements that contribute to the stability and solidity of the building. Finishing work is the covering of the framework.

Types of construction

Building materials are used for different types of construction, as listed below.

Breakdown of value added in construction France, ****, % of total Source: ****

INSEE distinguishes four construction sub-sectors: residential and non-residential building construction, civil engineering (***).

In ****, specialized construction accounted for **% of construction VA, civil engineering for **%, and residential and non-residential building construction for **%.

The development of certain products for ecological reasons

According to an article in Le Monde, nearly half of all energy consumption and a third of all greenhouse gas emissions are due to the construction and occupation of buildings in France. Reducing the energy consumption of buildings is achieved not only through the choice of materials, but also through the choice of partner craftsmen on the basis of their environmental impact.

Growing ecological awareness is influencing the purchase of building materials, and prompting companies to offer more and more of the following products:

Ecomaterials (***). Biosourced materials (of plant or animal origin, as opposed to synthetic products. Biomaterials used ...

4.2 Waste and recycling of building materials

Construction waste

With *** million tonnes of waste per year, the construction and public works sector is the biggest producer of waste in France. ** million tonnes of this *** million tonnes is attributable to the building sector. [***]

Waste from the public works and construction sectors comes from public (***). It is essential to treat this waste, as the construction sector produces around **% of all building and public works waste, i.e. more than the ** million tonnes of household waste produced each year.

Demolition accounts for **% of this waste, rehabilitation for **% and new construction for **%. The current recovery rate for construction waste varies from **% to **%, depending on the source, with significant variations depending on the type of activity (***).

Breakdown of waste by type of structure France, ****, in Source: ****

according to Batiadvisor, the breakdown of waste by type is as follows:

-Inert waste, such as concrete, tiles or stone, does not undergo any transformation during storage and represents **.*% of waste generated by the construction sector, or **.* million tonnes per year.

-Non-inert, non-hazardous waste(***), such as wood, plastics and packaging, posing no risk to health or the environment, accounts for **% of waste generated by the building sector.

-Hazardous waste, representing a risk to health and the environment, ...

4.3 Biobased building materials

As the building sector is at the heart of the challenges of sustainable development, the bio-based materials sector has been identified by the French Ministry of Ecology as one of the green industries with the greatest potential for future economic development. This is partly due to its role in reducing our consumption of fossil raw materials, limiting greenhouse gas emissions and creating new economic sectors.

The RE**** regulation is an environmental regulation applicable to new buildings in France from ****. It aims to reduce the environmental impact of new buildings by imposing stricter requirements in terms of energy performance, carbon footprint and occupant comfort.

The use of bio-sourced building materials enables compliance with these regulations by meeting a number of requirements. Firstly, these materials are considered renewable and environmentally friendly. They are therefore encouraged to reduce the carbon footprint of buildings and promote a circular economy. Secondly, bio-sourced materials have interesting thermal and acoustic properties, which improve occupant comfort while reducing heating and cooling requirements.

The RE**** also imposes requirements for the management of construction and deconstruction waste, encouraging the use of recycled or recyclable materials. Biobased building materials can also meet this requirement, as they can be easily recycled or composted ...

5.1 Regulations

Since ****, building and decorative materials in contact with indoor air have been subject to mandatory labeling. This is the application of Decree ****-*** of March **, ****, to inform consumers of the level of Volatile Organic Compound (***). Building contractors should therefore give preference to low-emission materials and products wherever possible.

Decree ****-**** obliges any manufacturer of a construction product to comply with a declaration if it communicates on its environmental characteristics since January *, ****.

The NF P **-*** standard is considered to be an application of ISO ***** to construction products. The latter deals with an object's environmental indicators. It proposes various factors to be taken into account when assessing a product's environmental impact. The purpose of this standard is to be used for product life-cycle analysis. In the same way, the NF P **-*** standard proposes a series of environmental indicators and provides for an assessment of the health risks to indoor air quality when the material is used. [***]

The RE**** regulation, applicable to new buildings in France from ****, aims to reduce the environmental impact of buildings by imposing stricter requirements in terms of energy performance, carbon footprint and occupant comfort. The numerical targets of the RE**** are as follows:

A **% reduction in the ...

6.1 What are the forces at work?

• Saint-Gobain Distribution Bâtiment
• Chausson Matériaux
• Larivière
• LITT Diffusion (SIG Groupe)
• TOUT FAIRE
• K Line (Liébot groupe)
• Rector Lesage
• Tecnomat
• Herige (ex VM Matériaux)
• Lapeyre
• Descours et Cabaud
• Saint-Gobain Groupe
• Vinci Groupe
• Lafarge (Holcim Groupe)
• Leroy Merlin France (Adeo)
• Castorama France (Kingfisher)
• Mr. Bricolage
• ITM Equipement (Bricorama, Bricomarché, Brico Cash)
• Brico Dépôt
• Terreal Groupe (Wienerberger Group)
• Alkern Groupe
• Carrières de la Vallée Heureuse
• Gedex Gedimat Gedibois
• Lhoist Groupe
• La Plateforme du Bâtiment (Saint-Gobain Groupe)
• Point P (Saint-Gobain Groupe)
• Bricoman
• Vandersanden
• Eiffage Construction Habitat
• STO Group
• Plattard
• SAMSE Groupe
• Dompro
• Maison Bleue Beton
• Stradal (CRH Group)
• GCP Applied technologies (Saint-Gobain Groupe)
• Chryso (Saint-Gobain Groupe)
• Chryso (Saint-Gobain Groupe)
• Chryso (Saint-Gobain Groupe)
• KP1