Italian stone sector anxious for relief

July 1, 2006
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The trade balance of the Italian stone industry is still slightly on the decrease, but signs of recovery have emerged on the international front - and Italian companies are looking to make the most of it. These are the findings of Internazionale Marmi e Macchine (IMM), as stated in its long-awaited yearly survey, just before CarraraMarmotec, the international marble fair which took place from May 31 to June 3.

In 2005, Italy exported over 4.7 million tons of marble, granite and other stone materials - up 1.1% over 2004 - with a value of 1.77 billion euros ($2.23 billion U.S.) - down 0.5% from 2004. On the import side, Italy imported 3 million tons of stone in 2005 - an increase of 1.3% over the previous year - worth 552 million euros ($694 million U.S.) - an increase of 4.08%.

The national export trends are extremely varied. For example, exports of marble blocks and slabs increased 6.7% from 2004 to 2005, while exports of granite blocks and slabs increased 1.1%. However, annual exports of marble blocks and slabs declined in value by 2.7% in 2005, and exports of granite blocks and slabs decreased 14.2% in value. In fact, the only significant increase in value can be found in the category of finished granite, which rose 3.2% in value during 2005 (even though tonnage dropped by 4.4%). A decrease, which is just slightly offset by finished granite (+3.3 %).

“These results are less than expected,” read a statement from Giancarlo Tonini and Paris Mazzanti, president and CEO, respectively of IMM. “The fall-off concerns all entries, nor is it set off by the new East European and North African markets. Despite this, some interesting signs of recovery can be seen: the consumption of stone products is actually expanding across the world - an opportunity to be made the most of, since our competitive chances are still strong in many important areas.”

North Africa and the Middle East have expanded their role in the marketplace, and have been actively importing finished marble and granite. Additionally, North Africa has been growing as an importer of marble blocks and slabs. “A lot will depend on the euro,” explained Tonini and Mazzanti. “If the euro/dollar exchange rate remains like this, it will help the whole European economy.”

With regard to stone-processing machines, the Italian leadership is sound, but competition is getting fiercer in the lower market ranges, a trend which in the future could affect the volume of Italian exports, even if perhaps not its values, IMM reports. Market trends were illustrated during CarraraMarmotec with the presentation of “Stone Sector 2006,” a new statistic yearbook about world trade patterns.

Export markets

The trend of the euro, which has slowly changed position on the dollar, has made it easier for the Italian industry to retain its position and market share in some important markets, but this was not enough - at least in some markets such as North America - to make up for what had been lost beforehand to other competitors. Such producers as Brazil (for granite) and Turkey (for marble) have gained substantial market share in the U.S.

Still, as part of an international trend of relentless expansion in natural stone use, many Italian companies have now decided to enter the North American market.

There have also been some signs of recovery for the Italian exports to areas such as the Middle East, which in 2005 grew by quantity and value because of the high quality of the products being ordered.

However, decreased sales within the European Union is a cause for concern, as it is the “priority market” for the Italian stone industry, and its decline has affected virtually all product types, especially finished products. These declines are not offset by the increase in the non-EU markets or the steady growth in North Africa, which is also interested in technology and equipment.

Thus, the overall export balance for 2005 remains negative compared to 2004, although very slightly so. And so the climate of uncertainty is bound to linger on, even if the current trend looks very promising for the future.

The Carrara region

As for the Apuan and Versilian district - which remains a fundamental landmark of the international stone industry - the region seems to have overcome its crisis, even if the results of the 1980s - and even those of 2000 - remain a distant memory. The second part of 2005 restored the confidence of many companies in the Carrara region, which report that their order portfolios are increasing - perhaps more than in the rest of Italy. Exports involve North Africa, the U.S. and the Middle East, with some encouraging figures in the Far East as well, where the tonnage of exports are decreasing (-11.7%), but values are increasing (+2.7%).

The U.S. imported 44% of the region's production in 2005, followed by the European Union, which imported 15% (down slightly from 17% in 2004) and the Middle East, which imported 14% (up slightly from 12% in 2004).

Producers from the region are reporting a stable business outlook, despite the turbulence and aggressiveness of their competitors, and they are optimistic that this is foreshadowing a general recovery of the economies within many importing countries.

The internal market also remains very important for the region, considering the role played by its proprietary white marble, even if 2005 showed a slight decrease in the amount of quarried materials. However, overall quarrying operations appear to be moving at the same pace as the processing operations, thus completing the picture of a “multi-tasking” district that is oriented to the internal and external markets.

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