The year 2022 was record-breaking in the construction chemicals market in Poland
Thanks to the record volume of initiated investments in residential construction in 2021 and ongoing construction projects, as well as the record number of completed apartments in 2022 (requiring finishing), the past year was a record-breaking one in the history of the Polish construction chemicals market. According to an analysis conducted by PMR analysts for the report “Construction Chemicals Market in Poland 2023 – Market Analysis and Development Forecasts for 2023-2028,” the size of the manufactured construction chemicals market in Poland in 2022 increased by 2.8%.
Surprisingly positive assessments of the current market situation among general contractors
The outbreak of war in Ukraine and its adverse impact on the macroeconomic situation drastically affected the market prospects for the entire construction sector, particularly in residential construction. Both developers and individual investors held back new projects and did not initiate new investments.
The decrease in newly initiated housing construction in 2022 reached 28%. In this context, the results of the market sentiment survey are somewhat surprising – the survey was conducted among a group of over 500 construction companies carrying out construction works using construction chemicals. These are mainly smaller companies specializing in renovation and finishing works, as well as structural works (using construction mortars, plastering, and executing insulation systems).
The construction chemicals industry sentiment index currently stands at 19.0 points, which is 4.1 points better compared to the results of the 2021 survey.
PMR analysts indicate that the growth in the volume of the construction chemicals market in 2022 is primarily due to the increased area of residential buildings (both single and multi-family) being put into use. This means that there is still a significant potential for finishing works, which contributes to the positive market sentiment regarding the demand for materials used in such works (tile adhesives, insulation materials). This is the main reason for the relatively positive market sentiment in the current survey.
At the same time, 2022 brought a collapse in the real estate development market and a sharp decline in newly initiated investments. Already in the second half of 2022, there was a decrease in demand for materials related to early-stage construction works (materials used for foundation works, concrete additives, or mortar). This situation will continue throughout 2023.
Find comprehensive information about the current state of the Polish construction chemicals market in the PMR report:
Unfavorable forecasts for the construction chemicals market – an inevitable decline in demand
The strong connection between the construction chemicals market and the situation in residential construction means that volume declines in the next two years are inevitable. As mentioned earlier, the demand weakened first in the category of construction materials. The results of the market sentiment survey confirm these findings: the weakest sentiment is currently observed in the masonry works segment (14.5 points). It is worth noting that almost all segments experienced an increase in the value of the index in 2023 compared to the situation two years ago (the previous edition of the PMR survey). The only exception was the weakest segment of masonry works, which saw a decrease of almost 3 points.
The forecast prepared by PMR analysts indicates that the volume of the construction chemicals market will not experience a collapse but a decline is inevitable. The baseline scenario of the forecast indicates around a 9% annual decline. 2024 will be another year of declining volume in the construction chemicals market, although it should not be as significant as in 2023.
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Construction Business Unit Director