Stone industry overview
In the commercial sector, stone is still a staple for designs where the goal is to impart a feeling of quality, and it is being used extensively for interior and exterior applications. But the biggest changes are being seen in the residential sector. Stone is no longer limited to wealthy homeowners. It has found its way into middle class homes, and it is found in â€œeverydayâ€ retailers such as Home Depot, Lowes and others.
Facts and figuresBecause of the way natural stone is sold and processed, it is difficult to quantify the size of the stone industry in the U.S. There have, however, been commendable endeavors recently. According to a report by Catalina Research Inc. and Ceramic Tile and Stone Consultants (CTaSC), a total of $3.3 billion worth of stone was consumed in the U.S. in 2002. This represents an increase of 50% from 1998, when consumption in the U.S. was reported at approximately $2.2 billion.
But the dramatic growth in the U.S. stone industry began much earlier in the decade. According to the U.S. Department of Commerce, a total of over $1.28 billion worth of stone was imported into the U.S. in 2002. Just 10 years ago, in 1992, that total was $417.4 million, or less than a third of 2002's figure.
Looking at specific materials, the U.S. Department of Commerce classifies marble, travertine and limestone under various categories of â€œcalcareous stones,â€ and so they must be measured as a combined total. In 2002, this total was $638.7 million, up from $230.3 million 10 years earlier. Granite imports went up by an even higher percentage, reaching $523.8 million in 2002, up from $115.5 million in 1992. Slate imports also increased by a significant factor, rising from a total of $21.6 million in 1992 to a total of $80.8 million in 2002. Imports of other stones, such as sandstone, porphyry, basalt, dolomite and quartzite actually decreased over the same 10-year period, dipping from $50 million in 1992 to $39.9 million in 2002.
Stone-producing countriesOver the past 10 years, we have seen a major shift in the countries that are exporting stone materials to the U.S. While some of the major players from 1992 -- Italy, Spain, Canada, India and Brazil to name a few -- are still high on the list in many categories, there are many other nations who are now carrying a high profile among U.S. importers. Some obvious examples are China, Mexico, Turkey and Israel.
It should be noted, however, that the exporting country recorded by U.S. Customs is not necessarily the country in which the stone was quarried. It merely represents the country where the stone was fabricated and shipped. For example, if a granite block is quarried in Finland and then processed into finished slabs in Italy, the material is recorded by U.S. Customs as an â€œItalian import.â€ As a result, nations that have well-established quarrying operations, but somewhat limited fabricating facilities -- such as Finland and Norway -- are not well-represented in the statistics provided by the U.S. Department of Commerce. Nevertheless, they play an important role in the U.S. stone industry that is unfortunately not recorded in terms of specific dollar values.
Looking at the well-established stone-producing nations, Italy remains the top exporter of stone to the U.S. in two major categories -- granite and calcareous stone (marble, limestone and travertine). In terms of granite, Italy exported over $194.9 million worth of stone to the U.S. in 2002, nearly four times 1992's total of $53.1 million. Italy also exported $199.3 million worth of marble, travertine and limestone to the U.S. in 2002, up from $100.1 million 10 years earlier. Italy has a vast number of well-established stone-related companies, and they remain at the forefront of developing and utilizing advanced stoneworking technology. Italy has historically been a leader in trends that develop on a global basis, and that rich tradition continues today.
Spain's exports of marble, travertine and limestone to the U.S. also increased greatly over the past decade, rising from $31.1 million in 1992 to $72.8 million in 2002. The country's granite exports to the U.S. grew from $7.0 million in 1992 to $21.9 million in 2002. Spain has also advanced its stoneworking capabilities, and its development of new applications and finishes for natural stone have been well-received on an international level.
India, which was just beginning to make significant inroads as a supplier to the U.S. in the early '90s, saw some tremendous growth of its exports over the past decade. Granite exports to the U.S. increased from $16.4 million in 1992 to $70.3 million in 2002, placing it third on the list of granite exporters to the U.S. Also very noteworthy, India became the leading exporter of slate products to the U.S. over the past decade, as it saw its total rise from $1.6 million in 1992 to $27.6 million in 2002. Calcareous stone exports from India to the U.S. also increased from 1992 to 2002, rising from $1.3 million to $5.7 million. The quality of Indian stone products has been growing in reputation, as the country's leading firms have been investing in cutting-edge technology for more than a decade.
Brazil saw similar growth in the granite and slate sectors, and it has also bolstered itself by investing in some of the best stoneworking technology from around the world. Brazil's granite exports to the U.S. rose from $9.4 million in 1992 to $127.7 million in 2002, making it the second-leading exporter of granite to the U.S. In the slate sector, exports to the U.S. from Brazil grew from $2.62 million in 1992 to $11.9 million in 2002. This makes it the third-leading supplier of granite to the U.S. market.
Turkey's exports of calcareous stone to the U.S. increased by a factor of more than 12 over the past decade. The nation's marble, limestone and travertine suppliers shipped nearly $120.6 million worth of material to the U.S. in 2002, up from $9.7 million 10 years earlier. New quarries and factories for calcareous stone in Turkey are constantly in development, and the country's leading firms have invested in their businesses to ensure long-term success. Granite exports from Turkey to the U.S. also grew as it began to develop new quarries in this sector, rising from only $127,000 in 1992 to $1.9 million in 2002.
China's role as an exporter of stone to the U.S. has been recognized not only by the stone industry, but also by members of the architectural community and other specifiers. This nation began utilizing advanced Italian stoneworking machinery over a decade ago. With this in mind, the quality of stone exports from China are increasing in many cases. As a result, China's exports to the U.S. have grown tremendously in every category. In the area of granite, exports from China to the U.S. grew from $2.5 million in 1992 to $43.3 million in 2002, placing it fourth in the world for this category. China also became the number two exporter of slate to the U.S. in 1992, with a total of $20.6 worth of material -- up from $1.9 million 10 years earlier. Exports of marble, limestone and travertine also rose from $4.2 million in 1992 to $28.6 million in 2002.
Bolstered by NAFTA, Canada and Mexico saw their exports to the U.S. increase -- despite the influx of inexpensive products from other nations. Canadian granite exports to the U.S. rose from $17.4 million in 1992 to $30.2 million in 2002. The country's marble/limestone/travertine exports to the U.S. also grew, from only $394,000 in 1992 to $9.17 million in 2002.
Mexico's exports to the U.S. rose even more dramatically, as its marble/limestone/travertine became one of the most popular and most recognizable products in this country. Exports in this category rose from $11.65 million in 1992 to $90.1 million in 2002, placing third in the world within this category.
Another major player in the area of calcareous stone is Israel. The popularity of â€œJerusalem Stoneâ€ in the U.S. over the past few years has proven to be much more than a passing fad, and exports of this material are continuing to increase as suppliers develop new innovative finishes, such as the unique â€œbrushedâ€ surfacing. Whereas exports of calcareous stone from Israel to the U.S. only totaled $207,000 in 1992, this figure jumped to $18.9 million in 2002, placing Israel sixth in the world among exporters of marble, limestone and travertine to the U.S.
Other new players in the category of marble, limestone and travertine included Pakistan, whose exports to the U.S. jumped from $765,000 in 1992 to $5.5 million in 2002, and Peru, which went from a figure of zero to $8.79 million during that same period.
Not every country saw increased business in the U.S., however. Greece, which had been a source for major architectural projects in the U.S. during the 1980s, saw its exports of marble, limestone and travertine drop from $15.9 million in 1992 to slightly under $11 million in 2002. However, the purity of Greek marble can still be of significant interest to the U.S. marketplace, as evidenced by the recent installation of 350,000 square feet of Thassos marble at The Borgata Casino in Atlantic City, NJ. (â€œA colossal display of stone in Atlantic City,â€ November 2003 Stone World).
France, which was fourth among suppliers of calcareous stone (mostly limestone) to the U.S. in 1992, dropped to seventh in that category by 2002. France's total exports in the category increased from $14.8 million in 1992 to $18.2 million in 2002, but it was surpassed by surging nations such as Turkey, Mexico, China and Israel. (Greece and Taiwan, which were ahead of France in 1992, fell below in 2002). Still, French limestone remains a staple of American architecture, and it is currently being installed for two major government projects within the U.S. -- Seattle's City Hall and the new federal courthouse in Brooklyn, NY (both covered in the October 2003 issue of Stone World.)
Fabricator optimismOne of the fastest growing segments of the U.S. stone industry is granite kitchen countertops. We are seeing new fabricators target this market on a daily basis. Since the start-up costs for this type of endeavor are relatively low, it is quite tempting for a shop foreman or experienced worker to go out and try to establish their own shop. But despite the many new entries in the field, the general feeling among stone fabricators is that there is enough work to go around.
According to a survey conducted by BNP Media (Stone World's parent company) a total of 81.0% of stone fabricators expected the stone market to increase in 2004. Virtually all of the other respondents (18.2%) felt that business would hold steady this year, and a very small portion (0.7%) predicted a decline. Over the next 5 to 10 years, 83.2% of stone fabricators said they felt the stone market would grow, and 15.3% said it would remain the same, with only 1.5% expecting business to decline.
Similar optimism was found by the Marble Institute of America (MIA), which conducted a survey at the December 2003 StonExpo trade show in Atlanta, GA. The Institute's survey revealed that the majority of stone professionals in attendance expect 2004 to be a better year for their businesses and the U.S. economy. A total of 85.4% of the 400 attendees personally surveyed by the Hudson Economics Group, L.L.C. are optimistic about the U.S. economy for 2004. Moreover, 26.6% believe the economy will grow 1-2%; 24.3% think it will grow 2-3%; and 13.9% expect 3-5% growth.
Both the BNP Media and MIA surveys also revealed that fabricators were planning to invest money back into their businesses over the coming year -- a practice that is sure to bolster further growth.
U.S. industry unificationDespite the increased level of business among the U.S. stone industry, there are still several significant challenges. Perhaps most daunting, imitation stone products are being marketed by large corporations, such as DuPont. Very often, these firms are promoting their products as a superior alternative to natural stone in terms of aesthetics and durability. And given the fact that the majority of stone-related firms in the U.S. are smaller companies with limited budgets, it is difficult to compete with the big advertising dollars that these corporate giants are spending.
To combat this, the Natural Stone Council (NSC) was formed to design and implement solutions to this challenge, now and for the future. Made up of a diverse group of stone industry businesses and trade associations, the NSC's mission is to raise the level of awareness and education of natural stone in the North American market. By pooling resources within the NSC, the stone industry is looking to collectively make a difference in promoting its products to consumers and decision-makers in the design community.
In its first year, the NSC has noted admirable support (see â€œIndustry support for Natural Stone Council is rapidly growingâ€ in this issue's Forum section). The NSC has raised nearly $300,000, with the largest donation being a grant of $100,000 from the StonExpo Foundation, which was derived from the revenues generated by the StonExpo trade show. Additional funding has come from members of the MIA, Allied Stone Industries, Indiana Limestone Institute, National Building Granite Quarries Association, Building Stone Institute, Elberton Granite Association, and American Monument Association.
Individual firms have also pledged their support, and at the recent StonExpo, the NSC's booth included a sign-up board for companies who wanted to contribute to the Council's collective efforts. In a heartwarming show of industry support, dozens of firms signed on to donate to the NSC while in Atlanta.
The NSC's largest initiative yet will take place in June at the AIA National Convention and Exposition in Chicago. The Council will be exhibiting in one of the show's largest booths, and it will be showing a broad range of stone varieties and applications, with information on their properties, use, cost, installation and recommended care. The NSC has also developed a CD/DVD that presents the story of natural stone -- from quarry to installation. It also includes sources for additional technical information on natural stones and their applications as well as contact information on the stone companies and organizations that are supporting NSC. The CD/DVD also will be available on request from NSC following the convention.
Following this endeavor, the NSC will be working on a branding campaign for natural stone targeted directly at consumers. This will include a seal to identify whether a material is authentic natural stone.
In addition to its support of the NSC, the MIA has also executed a number of initiatives to collectively benefit the stone industry. These programs allow U.S. members of the MIA to collectively save on everyday costs, such as energy and freight, as a result of new alliances with the Institute.
To summarize, our industry is perhaps more diverse and more international than ever. It is also larger than ever, and the collaboration among industry members must continue to maintain this growth and success. There are many challenges to our industry -- both known and unknown -- and our continued unification will meet these obstacles.