The clay brick market - France

1.2 A fast-growing European market, driven by 5 countries

By exploiting NAF code **.**Z, which represents "Manufacture of clay bricks, tiles and construction products", it is clear that the clay construction market in Europe has grown enormously between **** and ****, with sales increasing by **% over these years, as shown in the graph below.

Sales trends in the manufacture of clay bricks, tiles and building materials EU, ****-****, in billions of euros Source: ****

The European market is driven by * countries, most notably Germany and France, in addition to the UK, Italy and Belgium.

A comparison of the * graphs shows that the * European countries with the highest sales in this sector account for almost **% of the continent's total sales. But unlike the roof tile sector, where France accounts for **% of European production, it ranks only *th in Europe for clay bricks, with just *% of the continent's output.

Top * European countries producing clay bricks, roof tiles and building materials EU **, ****, in millions of euros Source: ****

While in Europe, bricks account for **% of clay building materials production, this trend is completely reversed in France, where **% of production is dedicated to roof tiles according toINSEE.

1.3 A stable French market in recent years

Sales trends in the manufacture of clay bricks, tiles and building materials France, ****-**** Source: ****

As the graph above illustrates, there has been a slight structural decline in sales of clay bricks on the French market. However, this is hardly significant given the strong stability of sales since ****.

1.4 Low export and import volumes in relation to French production

First of all, the weight of bricks forces France to trade mostly with neighboring countries, and then only in very small quantities. As the Fédération Française des Tuiles et des Briques (***) points out, the volumes of clay bricks exported are negligible compared to the volumes delivered within the country.

French clay brick exports negligible compared to total production France, ****-****, in Kilotonnes Source: ****

However, according toINSEE, in **** France exported almost *% (***) of its clay brick and tile production to Europe, of which **% went to Belgium and **% to the UK. This means that the vast majority of French exports are roof tiles. This seems quite logical, given that the weight to be transported for roof tiles is lower than for bricks.

French imports of clay bricks, roof tiles and building products amount to ** million euros, representing around *% of French production. Over **% of these imports come from * neighboring countries: Belgium, Spain and Germany.

As a result, the French trade balance shows a surplus of almost ** million euros.

1.5 The impact of the Covid-19 crisis on the clay brick market

The situation that emerged in **** with the Covid-** crisis led to a decline in demand for almost a year, due to a drop in household purchasing power and the inability of the French to travel.

Change in domestic and export sales index for bricks, roof tiles and clay building products France, ****-****, Base *** in **** Source: ****

It is clear that the market for bricks, roof tiles and clay building products has undergone numerous cyclical variations over the * years **** and ****. The only structural variation that remains fairly constant corresponds to the month of August each year, when there is much less activity. The sharp slowdown recorded in March and April **** is undoubtedly linked to the confinement of the French mainland, which has led to a sharp slowdown in construction activity. The market seems to lose momentum at the end of each year, only to peak at the beginning of the following year.

As for forecasts, according to Les Echos, the renovation market is currently in the midst of a boom that will last until at least ****. And with good reason: the health crisis seems to have stimulated the desire to renovate and move: some people move and then renovate their new home, but ...

2.1 Demand remains solid

From **** to ****, the FFTB claims that clay brick has grown from **% to **% of the new-build market, all housing types combined. Demand has thus stimulated this market until today, when almost half of all new single-family housing starts are in clay brick.

Size of the French single-family home construction market France, ****-****, in billions of euros Source: ****

This graph shows the rise of the single-family housing market since ****, with sales growth of **% between **** and ****. This has a direct impact on clay brick construction, which is becoming increasingly popular.

The spectrum of demand is therefore quite broad, since clay bricks are popular for both single-family homes and multi-family housing.

Distribution of housing starts by category France, ****, in Source: ****

Multi-family housing, which accounts for a significant proportion of demand and more than half of all housing units in France, is one of the leading consumers of clay bricks.

In the case of multi-family housing, certain customers can be identified indirectly: students (***).

The great advantage of clay bricks is that manufacturers have been able to adapt to market demand through innovation and research, enabling clay bricks to meet customers' thermal and ecological needs. Clay bricks are also particularly attractive in economic terms, especially for first-time ...

2.2 New housing construction and renovation drive demand for clay bricks

every year, nearly ***,*** new homes are built in France, or around ** every hour.

Housing starts by regionFrance, ****, in % year-on-year

Source: ****

This map shows the geographical distribution of housing starts, which are particularly concentrated in the South-West and North-East, which means that these are also the regions where clay bricks are increasingly in demand (***).

At the same time, over the period ****-****, the annual number of homes renovated is estimated at around ***,***, according to The Conversation. What's more, this number is likely to rise sharply in the coming years, as the government has set a number of targets as part of the Plan rénovation énergétique des bâtiments (***), which calls for ***,*** homes to be renovated each year. The aim is to solve the problem of the * million "energy wasters" in France's housing stock. Even if the government has not yet achieved its objectives, not least because of the Covid-** crisis that has arisen since the measure was announced, this does point to an upward trend in demand for building materials. This should benefit the clay brick market, since clay bricks are renowned for their thermal and ecological qualities.

There is, however, one limitation: the production of clay bricks requires a ...

2.3 Production where the demand is

Because of the difficulty of transporting large quantities of bricks, production sites are set up in the most convenient locations to minimize transport distances and delivery times. Indeed, transport costs can account for up to **% of total production costs. This is why the sites are located in regions where many terracotta houses are traditionally built: such as the South-West and the North-East. Another advantage is that these are the regions with the greatest demand for new housing. This represents a double opportunity for the terracotta industry.

Breakdown of salaried employees in establishments producing bricks, tiles and clay building materialsFrance, ****, in salaried employees

Source: ****

This breakdown of the workforce shows us the main geographical distribution of demand for clay bricks in France: Occitanie, Nouvelle Aquitaine and Grand-Est alone account for almost **% of jobs in this sector. It's worth noting that production sites are also located in these regions because of the abundance of clay soils in the vicinity, which is necessary for production.

3.1 A market in which the number of players is declining slightly but steadily

Growth in the number of companies in the clay brick and tile manufacturing market France, ****-**** Source: ****

Since ****, the number of companies operating in this sector has fallen by almost **%. For the most part, the companies that have disappeared from this market were small or very small businesses, faced with economic situations that they could not necessarily withstand due to their relative precariousness.

This had repercussions on the number of employees, which also fell sharply:

Change in workforce in clay brick and tile manufacturing France, ****-**** Source: ****

The number of salaried employees, like the number of companies, therefore fell by **% over the ****-**** period, revealing not a decline in market size, but rather increasing industrialization and automation in clay brick production, without this being to the detriment of traditional know-how.

3.2 Typology of French market players

First of all, the players are fairly evenly distributed, with companies of very different sizes. This means that there is a wide range of products and services on offer, even if some of the major players, which we will describe in greater detail later, monopolize a large part, if not almost all, of the market.

Distribution of companies in the clay brick and tile market by size France, ****, in Source: ****

We can therefore see that only **% of companies have more than ** employees.

But it's also a question of studying the relative market share of each category of company to examine how the market is divided between these players.

Breakdown of total market sales by company type France, ****, in Source: ****

We can see that **% of companies in the market (***) control almost the entire clay bricks, tiles and building materials market in France.

3.3 Key players in market sales

Among the companies present on the French market, according to figures from the Conseil National des greffiers des Tribunaux de Commerce, the * with the highest sales in France alone accounted for **.*% of French sales for clay bricks and tiles in ****. They share these sales as follows:

Main players in the clay brick and tile marketFrance, ****

Source: ****

Competition between these players is fierce, reaching a peak in the race for *st place between Edilians, the American giant, and Terreal, its French rival. According to L'usine nouvelle, Terreal is attempting to gain market share both in France and in Europe, with the acquisition of its German competitor Creaton in October ****.

3.4 Clay brick production structure

According to the Belgian think tank CEPS, clay brick production costs are determined by energy and transport costs, with transport sometimes accounting for up to **% of production costs. For this reason, production sites are often located close to extraction sites.

There are * distinct stages in the production process:

Raw material preparation Shaping Drying Firing

Shaped products are dried in special chambers or tunnel dryers. Drying can last from * to ** hours, at temperatures ranging from **° to **°. Drying is the most energy-intensive phase of the production process. The dried products are then fired to acquire their main characteristics: impermeability, fire resistance and hardiness . Themajority of kilns used by producers are heated by natural gas (***), while coal and oil are generally used when the latter is not available. Finally, the products areexposed for cooling, then shipped to distribution sites. Environmental and climatic concerns related to the production of clay bricks and tiles are mainly linked to the degradation of extraction sites and CO* emissions .

At European level, costs can be broken down as follows:

Breakdown of clay brick and tile production costsEU, ****, in %

Source: ****

3.5 A market increasingly moving towards a low-carbon industry

According to Le Moniteur, the "Usine bas carbone ****" technological breakthrough program, in which clay bricks have been involved for ** years, is to be extended to the European level. Its impact on the clay brick market is already remarkable, as its thermal resistance has been multiplied by *, which means that energy consumption is reduced, and the products created are lighter and better insulating.

Within the production process, new trends have emerged to further reduce the environmental impact of clay bricks:

Hot air not used in kilns is recovered to feed dryers Airlocks have been added to kiln doors to minimize heat loss Product layout in the kilns has been optimized Improved computerized control of the baking cycle

The impact is clearly visible, with energy consumption down **% from **** to ****. CO* emissions have also been reduced by **% between **** and ****.

4.1 Factors in the price of clay brick construction

According to the official website of the world's leading manufacturer of terracotta products, Wienerberger, the following parameters are immediately apparent: surface area, whether or not there is an upper floor, the shape chosen and delivery (***), as well as the professional contacted.

Other factors also need to be taken into account:

Bricks are extremely competitively priced: you can find it for around €** per square metre; of course, you have to add the cost of accessories and labour, with laying costing around €** on average, but this can rise to over €***. For * identical houses, one built in solid brick and the other in Monomur brick (***) The style of the house should also be considered, according to Ootravaux: a traditional-style house should cost on average **% less than a contemporary-style house of the same size. Finally, the level of finish will also have a strong impact on the price, but not only: the more elaborate the finish, the better the insulation performance, comfort and aesthetics of the house.

Producer price index trends for clay bricks, tiles and building materials on the French market France, ****-****, Base *** in **** Source: ****

After contemplating this graph, it is worth adding as a factor the evolution of the production price of ...

4.2 Clay brick product range typology

The clay brick market is divided into several categories, not all of which have the same market weight.

Typology of bricks on the clay bricks marketFrance, ****

Source: ****

Travaux Maçonnerie adds that the price of a terracotta brick house generally ranges from *** to *,*** euros per square meter, including tax. this range can be divided into *, with "shell " prices averaging between *** and *** euros per square metre, and "turnkey" prices between *,*** and *,*** euros per square metre, depending on the construction.

The price range for building a brick house is therefore very wide, depending on a number of factors, but it's certain that you'll need to reckon with more than **,*** euros for the construction of a ***-square-meter house.

4.3 Product benefits and breakdown by type

according to Travaux Maçonnerie, terracotta bricks offer a number of general advantages for construction:

High-quality, natural insulation for thermal savings: effective at containing heat in winter, and keeping cool in summer. An atrisanal construction based on a natural, ecological and recyclable material: clay, widely found in French subsoils Quick and easy to install, within the reach of even the most inexperienced builders Fire resistance: clay bricks are non-flammable and non-combustible. Long-lasting durability: the average lifespan of a clay brick is *** years Good moisture regulation: this helps prevent the appearance of mold and mildew

Breakdown of clay brick deliveries by type France, ****, in Source: ****

The wall brick market is therefore the one that largely dominates deliveries and thus production on French territory. Hollow bricks account for the largest quantities, followed by solid bricks and Monomur bricks.

5.1 Current and future regulations

At European level, there is a "Construction Products Regulation" (***) under which brick manufacturers must draw up a declaration of performance and affix the CE mark to their construction materials when these are covered by a harmonized European standard. Manufacturers are then required to undergo certification, which ensures that the product marketed complies with a specified standard. Once this Production Control System certification has been completed, the manufacturer has proof of compliance with CPR requirements. To combat over-consumption of energy and the rising energy bills of French households, the Grenelle de l'Environnement has set up a program to combat global warming and control energy consumption. According to article * of the Grenelle * law, the RT**** regulations currently in force were drawn up in ****, with the aim of limiting the primary energy consumption of new buildings to a maximum average of **kWhEP/(***).

A new regulation, RT ****, is due to come into force in the summer of ****, and is intended to develop the BEPOS (***) concept, which is at the heart of the Plan Bâtiment Durable. It does not include any obligation of means, but only of objectives. A positive-energy building is supposed to produce more energy in heat and electricity than it consumes. The ...

5.2 Financing assistance for eco-responsible brick homes

In addition to the price factors involved in building a home, we also need to take into account all those that can reduce the cost of construction.

Terracotta bricks, with their low environmental impact once installed (***), are part of an eco-responsible approach.

That's why numerous aid schemes have been set up in France to give people access to quality, sustainable services.

Ootravaux distinguishes between :

Action Logement loans: These are reduced-rate home loans for private-sector employees. They may not exceed **% of the total cost of the work, and are for a maximum amount of **,*** euros. For this to be issued, the house must comply with RT **** regulations. Zero interest rate loan: This is an interest-free loan for future homeowners. Eligible borrowers must not have owned a home in the * years preceding the application, and must not exceed a certain income ceiling calculated on the basis of several factors (***) The Social Accession Loan: This loan is reserved for future homeowners with modest incomes. Eligibility criteria depend on resources, location and future number of inhabitants. It is delimited by limited interest rates and a repayment period ranging from * to ** years. The Pinel scheme: This measure is intended for new housing only: future owners can ...

6.1 Market segmentation between different players

• Edilians
• Terreal Groupe (Wienerberger Group)
• Wienerberger 1
• Bouyer Leroux Groupe
• Briqueterie Chimot
• Briqueteries du Nord
• La Française des Tuiles et des Briques
• Fabemi Groupe
• Wienerberger Terca
• Vandersanden
• Cleia Ingenierie
• Rairies Montrieux
• Acceo
• Raise invest
• Gide Loyrette Nouel Avocats
• Rairies Montrieux
• Tegulis
• Barthe