Stone World

The stone industry in figures

February 8, 2001
According to the authoritative survey in the "Stone 2000" report published by Gruppo Editoriale Faenza, world stone production in 1999 came to 110 million tons, which represents the gross of quarrying, including processing waste as well as off-cuts.

This figure highlights how the sector has achieved consistent growth in production over the past 30 years. Moreover, growth seems set to continue over the first 25 years of the new millennium, based on certain economic forecasts.

Consumption reached a total of approximately was equal to about 600 million square meters, generating turnover of over $20 billion (U.S.). Per capita consumption of stone materials in 1999 exceeded 10 square meters/100 persons for the first time ever.

A decisive role in the development of the stone field was played by trade, which exceeded 20 million tons for the first time. Taking unfinished and processed material into account, this equals about 310 million square meters. The figures also emphasize that the absolute majority of world consumption involves materials quarried in countries other than those where they are installed.

World trends

China, Italy, Spain, India and Brazil alone cover 53.5% of world quarrying output, also confirming the concentration of down-line operations in the majority of cases.

Prices in major markets -- the European Union, the Far East and North America -- are falling on average, although there are several significant exceptions. This is part of a long-term trend induced by rapid technical development and the growing popularity of stone, contributing decisively towards ensuring new application fields for natural stone materials.

An analysis of 1999 trends highlights how growth is characterized by variable rates. While major growth was achieved by China in terms of output, and by North America in terms of consumption, the worst results came from Italy, where an industrial recession has brought about significant drops in market share, down to 46% for world machinery exports and 16.5% for natural stone products.

But in absolute terms, Italy remains the leader, even though its advantage has been significantly eroded -- not only in favor of non-European countries but also by some EU "partners" (Spain and Portugal in the forefront) currently enjoying a period of strong development.

Forecasts over the next five years indicate growth in terms of both the volume of stone materials quarried all over the world -- expected to settle at around 160 million gross tons -- and applications, about 900 million equivalent square meters. Moreover, international trade is expected to reach 500 million meters.

The machinery sector

With regard to machinery, 1999 saw world production settle at around 170,000 units, two-thirds of which were traded. For machine exports, Italy saw its share of world market exports drop to 46%, a figure which highlights how industrial stagnation in Italy has had quite serious consequences.

It is hypothesized that the growth trend in the stone field will settle in the near future, at coefficients no lower than those of the 90s.

However, attention will focus on the general and increasingly pressing problems concerning infrastructures, plant equipment and handling of waste materials. These problems will have to be addressed on all levels (national and international), bearing in mind the fundamental role of investments and the need to expand them on an industrial scale, even through government incentives.

Nevertheless, the stone industry has been distinguished by the possibility of creating jobs with relatively limited financial resources, to such an extent that it is recognized as suitable for launching expansion operations in areas where other industries would be structurally inappropriate.

The Italian situation

Italy -- despite its current market situation difficulties - is one of the protagonists in the natural stone industry, with regard to both quarried materials and the value and quantity of commercial trade. On the basis of initial analyses, this appears to have grown over the first two months of 2000, as compared with the same period in 1999 -- by 9% in quantity and 15% in value.

Over the last five years, notwithstanding certain difficult situations which have affected supply and demand trends, the Italian natural stone sector has achieved constant progress in terms of both quantity and income.

Two further significant figures detail the situation of the Italian stone industry. The number of employees dropped from 63,000 in 1998 to 60,000 last year. At the same time, plant exploitation percentage levels dropped from 80.6% two years ago to 77.3% last year. This can be attributed in part to the drop by a further percentage point in foreign orders, from -2% in 1998 to -3% in 1999. This figure is compounded by a drop in domestic orders, which recorded a further n1% drop in 1999 compared with the previous year (-1.5%).

Italian machinery production

Among stoneworking equipment manufacturers, Italy maintains its world leadership as expected, although its share of the world market dropped in the face of stiff competition from other producer countries in Europe and elsewhere.

A recent study by Ceris (Business and Development Research Institute of the National Research Council) highlighted the impressive vitality of this sector, which has 180 companies and about 3,500 employees. Conversely, however, the report highlighted how these manufacturing companies are largely small- to medium-sized enterprises. There are few companies with more than 100 employees (only 11, according to the study; the largest has 400 employees) and as many as 79 with fewer than 20 employees.

Most companies are located in northern Italy (77% of turnover), especially in the provinces of the Veneto. These are joined by Apua-Versilia (21% of turnover) and companies in Central-Southern Italy (2% of turnover).

The average annual growth in turnover of these companies was higher than 10% over the last five years. Moreover, this sector has enjoyed excellent productivity, ranging between $195,000 to $233,000 of turnover per employee.

Looking at breakdown of turnover figures in sector by machinery type, about 70% of turnover is generated by stoneworking equipment and a little over 7% by machinery for quarries, while the remaining 22% comes from the production of other capital goods (tools, handling equipment, parts, etc.). In parallel, exports -- still a major share of turnover for the entire sector -- are comprised primarily of stoneworking equipment, followed by quarry machinery and other capital goods (16-18%).

Ceris also highlights the strong cyclic nature of market demand for stone processing machinery, which is directly linked to investment trends among companies processing stone materials and those in the building industry. This fact further emphasizes the close relationship between processing activity and machine construction, a relationship that has enabled the Italian stone industry to supply highly competitive processed materials to the world market.

In any case, the synergy between machinery-building companies, quarrying companies and processing companies is worthy of detailed investigation. Moreover, increased innovation by the stone companies has enabled Italian firms to handle higher industrial costs as well as the lack of labor prepared to accept such rather heavy and sometimes dangerous employment.

Today, the market offers the first continuous electronically controlled lines for cutting blocks and subsequent operations to fabricate and polish tiles. Additionally, cutting machines equipped with computerized controllers are progressively more common in stone processing shops. Technology now makes it possible to link different gangsaws together through a computerized production control system in which every processing stage is controlled by remote computers. Gangsaws equipped with this new technology can operate 24 hours a day, including holidays, without requiring operator supervision.