Glass - A Growth Industry
Over the long term, demand for float glass is growing at over 4 per cent per annum. This growth is fuelled by the demand for building glass and automotive glass, which in turn is driven by economic growth. In the last 20 years, float demand growth has outpaced real GDP growth. Over the past 10 years, float demand has exceeded GDP growth by around one percentage point on average.
The world flat glass market is expected to reach 55 million tonnes by 2009, including 2 million tonnes of rolled glass.
Global float capacity utilisation has ranged between 90 and 95 per cent (virtually the practical limit for a network of float plants, since having all of the right thicknesses in the right place at the right time is not generally achievable). In 2007, the industry was calculated to be running at around 93 per cent utilisation.
Global capacity utilisation looks set to remain around 90 per cent utilisation for several years, based upon the information currently available on future float builds. However, it is considered unlikely that all announced lines will go ahead with the timings shown elsewhere in this report.
A further significant point is that each new float line that is added to the installed base represents a smaller percentage of installed capacity and is therefore likely to cause less of a disturbance to the supply demand balance. This can be illustrated by the following chart showing the effect of additional float capacity since the construction of the world’s second line in 1962.
A new float line added in 1970 represented 3 per cent of global float capacity. A new line in 2007 represented only 0.3 per cent of global installed capacity. Nevertheless, the impact of a new float line in certain territories can still be quite marked, at least in the short term, until the new capacity is absorbed by market growth.