Decline in turnover of 4.2% for ceramic industry machinery

Acimac: 15th Annual Statistical Review

Overview
The overall sector turnover of machinery for the ceramic industry in 2006 amounted to 1702.1 million euro, a reduction of 4.2% (–75 million euro) compared to the previous year, but an increase of 6.8% on the 2004 result. This indicates the short-term nature of the drop, caused by a pause for reflection affecting investments in new technologies in various important ceramic manufacturing countries. The Middle East, for example, after its flourishing turnover in 2005, fell by 24.4% and Asia (excluding China) by 21.1%. Positive performances, on the other hand, were registered in the European Union, Africa and China.
The Italian domestic market remained basically stable (+0.3%) at 458.3 million euro, and this in a year without any dramatic major investment in new manufacturing plants on the part of Italian manufacturers, who were mostly committed to internationalizing parts of their production or seeking qualitative improvements in their output. Exports totalled 1243.8 million euro (–5.8%), accounting for 73.1% of sector turnover, confirming once again the global dimension of Italian production of machinery for the ceramic industry.

Companies and employees
In 2006, 166 companies were active in Italy, an increase of 10 in comparison to the 156 of 2005. This statistic might seem to be contradicted by the announcements of mergers and takeovers within the sector during the year, which will very likely be part of a continuing trend. The explanation lies in the fact that many companies (mostly of limited dimensions) that were previously excluded from the survey have now been included. In terms of employment, 2006 saw a total of 6939 employees working in the sector (+6.8% compared to the 6495 in 2005).

Markets
The European Union, last year pushed into second place by the Middle East, increased its orders for the third year in a row (+11.2%) and returned to being the principal market for Italy’s ceramic machinery manufacturers with a total of 313.6 million euro, a share of 25.2%.
Despite a contraction of 24.4%, the Middle East took second position (218.7 million euro, 17.6% of the total). After its boom in 2004 and 2005, therefore, the area confirmed itself as a promising market: over the last three years it has shown 20.4% growth.
Sales in Eastern Europe reached 179.9 million euro, down by 9.2%, accounting for 14.5% of the sector total. This is the second best result in the last ten years in the eastern European market.
Africa marked up a notable rise (+36.2%) with an unprecedented 138.3 million euro in purchases, while Asia – excluding China – shrank to 119.2 million euro (–21.1% on 2005, almost a record-making year, but up by 22.5% compared to the 97.6 million of 2004).
Central and South America, following two years of intense development, contributed with purchases of 115.6 million , a reduction of 4.6%.
Positive news came from the China – Hong Kong – Taiwan area with an increase of 21.3% up to 78.8 million euro. This is a revival that justifies optimism, even though far below the peak results reached a decade ago.
North America – including Mexico – slowed down to 72.4 million euro (–30.1%) following the conclusion of various important supplies for new plants.
The list is concluded by Oceania with 7.3 million euro, down by 11.5%.
Worth noting, once again, is the way that the sector export pie chart is divided into many slices of a similar size, demonstrating a global presence with a healthy spread over various continents. This is a guarantee for the continuing stability of the sector, since it avoids excessive dependency on any one market and is therefore capable of compensating temporary negative trends in given areas. At 39.7% Europe is the leading market, with Asia at 33.5%, America at 15.1% and Africa at 11.1% of total turnover.

Client sectors
The figures for 2006 confirm, with no dramatic differences, the well established proportions of machinery sales as spread between the six different kinds of ceramic industry clients. 80% of the sector’s overall turnover is constituted by machinery for tile manufacture, a client area that, despite a contraction of 3%, remains by far the most important market, accounting for 1361.2 million euro (72.6% of this for exports).
Far back in second position is heavy clay machinery, despite a rise of 8.3% to 179.1 million euro (10.5% of total sector turnover, with 65.7% destined for export).
Still further behind, and falling by 5.3% after the robust growth of 2004 and the levelling out of 2005, comes sanitary ware machinery, accounting for 87.3 million euro (5.1% of the total, with 83.5% destined for export).
Contraction could also be seen in the tableware ma-nufacture client sector (–21.2%), stalled at 45.7 million euro, just 2.7% of total turnover. The smallest sectors were those of machinery for refractory materials, with sales of 27.5 million euro (1.6% of the total) and miscellaneous ceramics at 1.2 million euro (0.1% of the total).

Types of machinery
2006 saw a slight fall in turnover for various kinds of machinery with the exception of machinery for shaping (+11.6%), glazing and decoration (+5.2%), finishing (+15.6%), quality and process control (+382%) and laboratory instruments (+85.8%).

Forecasts for 2007
According to the most reliable analysts, global manufacture and demand for ceramic products is set to grow still further and this forecast is undoubtedly the principal justification for continuing optimism on behalf of Italian manufacturers of machinery for this sector. In particular, beyond the purely quantitative aspect, the sector is benefiting from the continuously growing need for ceramic producers – especially tile manufacturers, both in Italy and abroad – to improve product quality levels. Another major factor is the aesthetic dimension, where Italian technology is capable of offering an outstanding range of possibilities, effects and designs, thus strongly influencing prevailing tendencies.
In terms of the different global markets, consistent technological investments are expected in Italy and in the rest of Europe in general. A revival of demand from the Middle East appears likely, while South America and Africa have the potential for strong growth. In any case, 2007 should see a substantial consolidation of trade volume of Italian machinery for the ceramics industry, in a market characterized by overall stability.