Gypsum industry news

Australia: The board of directors of Boral has announced that Boral CEO and managing director Mike Kane will declare his retirement after delivering the company’s whole-year 2020 (1 July 2019 to 30 June 2020) results in mid-August 2020. Kane said, “I am proud of Boral’s people and I thank them for their continued support as well as the support of our customers. I remain committed to Boral and look forward to delivering Boral’s full-year 2020 results and facilitating a smooth leadership transition.”

The Sydney Herald newspaper reported that Boral revised its whole-year net profit forecast up from US$214m to US$228m, which would be down by 19% from US$281m in the Australian financial year 2019.

Australia: Ord Minnett, a financial services company, estimates that Boral could pay as little as US$0.5bn to buy the other half of USG-Boral, the joint venture it runs with USG. The financial company has made the forecast following the on-going acquisition of USG by Germany’s Knauf, according to the Australian newspaper. It believes that Boral is in a strong position given falling value of the joint venture and problems with Knauf’s geographical asset base following its purchase.

Brazil: Saint-Gobain will revise its year-on-year turnover growth projection of 7% in Brazil for 2015 as it is expecting volume sales to be lower than 2014, according to Thierry Fournier, the firm's president for Brazil, Argentina and Chile. Turnover is expected to still grow but at a slower rate than 7%, according to Valor Economico.

The building materials producer had to lift prices in the first half of 2015 to compensate for rising energy and US dollar-linked raw material costs. Despite this the group still continues to gain market presence in some segments like drywall.

Saint-Gobain holds a diversified presence in Brazil with divisions manufacturing fibre cement, mortars, wallboard, insulation and glass.

Japan: Chiyoda Ute Co Ltd has released consolidated financial results for the nine months to 31 December 2011. These show that sales increased by nearly 10% year-on-year to US$264.8m, while the company's operating profit came in at US$5.7m compared to a loss of US$9.6m a year earlier. The company made a net profit of US$2.8m, up from a loss of US$13.7m in the first nine months of the previous fiscal year.

The company expects to make a full year net profit of US$7.4m in the current fiscal year (ending 31 March 2012) from sales of US$375m.

US: Gypsum consumption in the US has declined steeply in the past five years according to data released from the US Geological Survey, falling by over 50% from 41.6Mt in 2006 to just 19.4Mt in 2010. However, following an announcement that housing starts will increase by 15% in 2012 from the National Association of Home Builders (NAHB), gypsum demand is expected to finally rise.

The increase in housing starts and associated increase in gypsum wallboard demand is forecast to cause an increase in gypsum wallboard prices, with National Gypsum Properties, a North Carolina-based provider of wallboard and related products, announcing plans to raise its prices by 35% from 1 January 2012. Other suppliers and manufacturers may follow suit.

Craig Weisbruch, National Gypsum's senior vice president of sales and marketing, said that manufacturers expect to sell about 17bn ft² of wallboard in 2011, down from 38bn ft² in 2006. "We're changing the nature of the game here," he said. "I don't know if it will work or not, but we're all losing money. The amount of product we're shipping is so little we just can't cover our costs."

US: Like other makers of building products, United States Gypsum Company (USG), the US's largest maker of wallboard thrived during the US housing boom. But the company fell into the red in the fourth quarter of 2007 and is yet to climb out. With the anticipated housing rebound remaining elusive, average home prices in the first quarter of 2011 dropped to back to 2002 levels. This weak housing demand has spurred fears the economy may yet return to recession, with further losses expected for USG in the coming months.

USG Chief Executive James Metcalf, joked in a recent interview at the company's headquarters that he was getting tired of being asked to speak at conferences about 'managing in turbulent times' and has declined to predict when his company will return to the black.

Metcalf said that the company was building more modern plants and couldn't have foreseen the precipitous drop in housing construction, currently running at around a quarter of the peak level. USG has cut its work force by about one-third, to about 9250, since the peak. It has shrunk wallboard production capacity by about 30%, closing eight wallboard plants and idling others. The company's prolonged slump shows the peril of relying heavily on any one part of the world, even a market as large as the US, which accounts for 77% of USG's sales.

That said, USG is trying to build up sales in China, parts of Latin America and a few other areas without going fully global. Metcalf said, "We're putting bets down now -- small bets." For now though, the company's top priority is surviving the US housing collapse.