The recession has left the metal roofing market slightly weathered, but its impact has certainly been far less severe than on other sectors of the construction industry. And while metal roofing demand might be down this year, according to some, the product continues to grow in popularity and gain market share vs. the dominant asphalt shingle roof sector.
"For 2009, the statistics are telling us that (metal roofing) is down to 9 percent of the market, but 10 years ago metal roofs had 3 percent of the market," said Bill Hippard, vice president of sales at St. Louis-based Precoat Metals, a coil coating facility that services metal roofers. "In 2008 it hit 9.75 percent .?.?. for a product to only lose three quarters of a percent in a down market shows that our sector is still enjoying success."
While bullish on the potential continued growth for metal roofs, another expert agreed that demand has retreated this year. "Metal roofing is not as strong as it was this time last year. What I am hearing is buyers have their hands in their pockets and are afraid to make the financial commitment," said John Packard, publisher of Steel Market Update, who spent more than 30 years working in the flat-rolled steel side of the business, with an emphasis on coated products.
A number of factors are working together to forge an expectation that metal roofing might garner as much as 15 percent of the market by 2012, said Hippard, who also serves as president of the Metal Roofing Alliance (MRA), a Belfair, Wash.-based coalition of metal roofing manufacturers, paint companies, coil coaters and contractors. "There are a lot of forces that are helping it along," he said, pointing to the cost of asphalt shingles—still the big player with 75 percent of the market. These costs "will continue to escalate because the (tar) pitch used continues to become more expensive."
Each percentage point of market share gained means consumption of an additional 100,000 tons of G90 galvanized coil or Galvalume, the raw materials for a metal roof. One metal roofing trade association has estimated that 40 billion square feet of such coil is covering roofs on a global basis.
"The biggest piece of the roofing market is Galvalume, as galvanized tends to be used in agricultural buildings such as chicken coops," Packard said. Domestic Galvalume suppliers include ArcelorMittal USA, Chicago; Severstal North America, Dearborn, Mich.; Steel Dynamics Inc., Fort Wayne, Ind.; Steelscape Inc., Kalama, Wash.; U.S. Steel Corp., Pittsburgh; and Wheeling-Nisshin Inc., Follansbee, W.Va. Starting next year, Germany's ThyssenKrupp AG will participate in the market from its Alabama mill.
Several factors are driving the improvement in market share, according to Scott Kriner, technical director for the Metal Construction Association. "The cost of traditional petroleum-based roofing material is increasing, which is narrowing the gap between the initial cost of those materials and that of metal roofing," he said.
In addition, the interest in sustainable building design is focusing on the durability of products. The documented long service life of metal roofing is getting the attention of design teams, Kriner said, noting that a growing concern for energy efficiency also is helping to boost sales.
While the American Recovery and Reinvestment Act hasn't bolstered demand, a $1,500 tax credit that has been around for a few years is helping. Property owners switching to metal roofs are eligible for a Property Assessed Clean Energy (Pace) incentive, a state-by-state program recognizing energy efficiency improvements.
Energy efficiency is expected to remain an important factor. "An increasing interest, and in some cases mandates, for net zero energy buildings will put more pressure on designers to lower energy usage as much as possible. This creates a driving force for energy-efficient cool metal roofing as well as energy-efficient roofing assemblies. A metal roof will be looked upon as a favorable platform for rooftop renewable energy generation," Kriner said.
To capitalize on roof replacements, the MRA is focusing on direct marketing to home owners. "We go directly to the consumer," Hippard said. "A metal roof is still a premium cost, but when you do a lifecycle cost analysis metal is still a bargain. But homeowners are recognizing the potential energy savings and increased life of the product and are willing to make the switch from shingles to metal."
Over a 60-year period, the installation and upkeep of a metal roof is expected to cost $9,460 compared with $34,615 for an asphalt roof, the MRA said.
While residential metal reroofing has been fairly immune to the effects of the downturn in the construction sector, nonresidential building starts and upgrades are still trying to find their bottom. "Demand trends for roofing appear to be fairly flat with no expectations for an increase until late 2011 or into 2012," Packard said. "Nonresidential markets are essentially in the process of hitting bottom. The normal downcycle is three to five years, so we can expect nonresidential to be flat for another year before starting to come back to life."
Metal roofing manufacturers are striving to keep their volumes up, which benefits the consumer. "Competition is fierce in both the metal building and roofing industries due to the limited amount of work and the number of competitors trying to survive. Now is a good time to reroof your house with a metal roof," he said.
Packard acknowledges that some players, unable to compete, will exit the market. "I have to assume there will be companies failing over the next two years in both the metal building and roofing industries," he said.