U.S. Custom Roll Form Product Market Flattened at $7.5B

Basic Iron And Steel October 10, 2017
Author: Irina Andreeva
Market Analyst

custom roll form product market

In 2016, the custom roll form products market in the United States amounted to 7.5 billion USD, which stood approx. at the level of the previous year, and was also 1.0 billion USD (or 13%) less than the outset level. After a noticeable decline of consumption by 33% in 2009, it surged in the next year with a further upward trend over the next four years. However, according to market research conducted by IndexBox, the market slipped back again in 2015 and then stabilized; overall, despite attempts at recovery, the total industry revenue it yet failed to reach its pre-crisis level.

Custom roll form products can be made of different materials, such as copper, aluminum, steel, etc. In this regard, the product raw material supply is determined by the state of the metallurgical industry, which had experienced moderate volatility in the last four years. The decline in world prices for steel, aluminum and the majority of other metals exerted pressure on domestic manufacturers of metal products, which led to a decrease in prices, which subsequently reduced the custom roll industry's revenues as well. On an unadjusted basis, the annual average producer price index for custom roll form products manufacturing fell by -10.4 percentage points in 2015, after falling by -4.7 percentage points in 2014. In 2016, that downward trend continued, falling by -5.0 percentage points from the level of 2015. However, in 2017 the average annual producer prices have bounced back slightly.

Custom roll form products are manufactured according to the customers’ individual design for various industries: from agriculture and home appliances to construction products, conveyors, storage systems, transportation, construction and automotive industries. Custom roll products market is fully buoyed by domestic production: the share of domestic production in terms of the market value stood at 98.2% in 2016. The low intensity of international trade with regard to this product is determined by the specifics of this business: products are usually tailor-made, which makes it advantageous to locate manufacturing facilities closer to customers; in addition, local manufacturers guarantee quality and exact compliance with technical standards and requirements in force in the US.

This trend to locate the manufacturing facilities close to industrial customers leads to the fact that the custom roll industry continues to be highly fragmented. There are approx. 450 private business establishments engaged in the custom roll form products manufacturing and the majority of those enterprises (74%) operate with fewer than 50 employees. Establishments with the number of employees ranging from 50 to 249 persons hold a 23% share, while large enterprises account for only 4%.

The industry enterprises are mainly situated in the Mid West, South, and the West regions of the United States. The highest number of industry establishments is found in the Mid West, an estimated 31% of the total amount of custom roll form products manufacturers. Within the region, near 7% of the U.S. total custom roll form products manufacturers are concentrated in Ohio. The South ranks the second-highest, with an estimated 23% of industry establishments. With a 3% share, North Carolina has the highest number of custom roll form product manufacturers in the region. Approx. 15% of industry establishments can be found in the West region. The most popular State was California, accounting for 9% of the industry’s locations.

As custom roll form products are used in a large scope of industrial applications, market performance will be affected by the general state of the manufacturing industries in the US. After a weak first half of 2016, economic growth in the US slightly accelerated. However, despite the improvement of consumer and export demand, investment in equipment was reduced last year.

Between 2017 and 2025, it is expected that the annual GDP growth in the US will average 2.2% over an upcoming nine-year period. The annual growth in industrial manufacturing in the US is expected to stand at 1% during 2016 and 2017, with a slight acceleration in subsequent years. In the long-term, the US economic growth is restricted by demographic and labor problems, and in the short-term - by political and commodity markets uncertainties, as well as by the issues of productivity growth. Low level of capital investments also presents a long-term problem that adversely affects future production performance and contributes to deterioration in productivity, which, in turn, may adversely affect economic growth in the US.

Driven by the current economic recovery in the U.S. and a moderate growth of manufacturing, the custom roll product market, as well as the fabricated metal product sector as a whole is expected to continue a modest upward consumption trend over the next nine years. The performance of the market is forecast to increase, with an anticipated CAGR of +1.5% for the nine-year period from 2016 to 2025, which is projected to lead the market value to 8.6 billion USD by the end of 2025.

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  • key custom roll form product producers

Source: U.S. Custom Roll Form Products Market. Analysis And Forecast to 2025