US Demand for Silicones to Exceed $4 Billion in 2016

US demand for silicones is forecast to climb 5.6 percent annually to $4.1 billion in 2016, with advances accelerating strongly from the pace of the recession-impacted 2006-2011 period.  Gains will stem from renewed economic growth, along with rising manufacturing output and rebounding construction activity.  In volume terms, silicone demand is projected to expand at a 4.8 percent annual pace to 890 million pounds in 2016.  These and other trends, including market share and product segmentation, are presented in US Silicones, a new study from The Freedonia Group, Inc., a Cleveland-based industry market research firm.  

Silicone fluids and elastomers comprised the largest share of silicone demand in 2011, with each product accounting for more than 40 percent of the total.  Although silicone fluids will experience below average gains through 2016 due to maturity in certain markets, increasing output of cosmetics and toiletries will promote the development of innovative silicone fluid emollients and conditioning agents designed for use with natural ingredients.  Rebounding growth in the construction market will drive above average gains in demand for silicone elastomers, as well as for silicone resins.  Silicone resins accounted for 11 percent of aggregate demand in 2011.  Renewed strength in the construction industry will drive demand in this product segment, as silicone resins are primarily used in paints and coatings.  Silicone gels represent a small but important product segment.  Demand for these materials will benefit from the increasing utilization of silicone gel encapsulants in the fast growing photovoltaic and light emitting diode (LED) sectors of the electronics market.  Moreover, silicone gel-filled breast implants -- which were reintroduced to the market in 2006 after a 14-year ban -- will continue to capture market share from their saline-filled counterparts.

The industrial market will remain by far the largest outlet for silicones.  The motor vehicle segment is projected to provide the best growth opportunities, driven by substantial increases in vehicle output from relatively low 2011 levels, as well as by advancements in silicone technology aimed at improving vehicle safety and fuel efficiency.  Among other markets, construction and medical products will achieve particularly rapid growth.  Advances in the construction segment will be propelled by a strong recovery in building construction, particularly in the new residential segment, as well as by the use of high performance silicone-based adhesives, caulks, and coatings.  The medical market has been the fastest growing segment of the silicone industry in recent years, and will continue to expand strongly. 

The Freedonia Group is a leading international business research company, founded in 1985, that publishes more than 100 industry research studies annually. This industry analysis provides an unbiased outlook and a reliable assessment of an industry and includes product segmentation and demand forecasts, industry trends, demand history, threats and opportunities, competitive strategies, market share determinations and company profiles.