By Jeffrey C. Rasmussen
The U.S./Canadian geosynthetic market includes geotextiles, geomembranes, geogrids, geosynthetic clay liners, drainage materials, geocells, and erosion control materials. In terms of value, geomembranes made up 51% of demand in 2014. Geotextiles were the second largest segment in terms of value in 2014, representing 25% of demand.
In 2014, the size of the U.S./Canadian geosynthetics market was $2.2 billion. The U.S./Canadian geosynthetics market grew 4% in 2014—a nice improvement over its 1.5% growth rate in 2012. In a survey of Geosynthetic Materials Association (GMA) members and nonmembers in October 2014, respondents reported they expect sales to be slightly better in 2015 than in 2014.
Trends and opportunities
Trends cited in the survey included:
- more competition domestically and from an increase in inexpensive imports.
- continued increase in activity in the mining market, especially in the shale market. continued increase in the oil and gas market.
- increase in geomembrane liners, especially as a result of the coal ash disposal ruling by the U.S. Environmental Protection Agency (EPA) on Dec. 19, 2014.
- Opportunities cited by survey respondents in the U.S./Canadian geosynthetic market for 2015 included:
- an increase in market activity in the railroad market.
- an increase in domestic resin production should help bring down the cost of raw materials.
- continued growth in the U.S./Canadian oil and gas markets.
- enhanced growth of the geosynthetics market resulting from industry efforts to improve and promote the benefits of geosynthetic usage to state transportation departments (DOTs).
- continued efforts to educate civil engineers about the benefits of geosynthetic usage compared to traditional building materials.
- as noted previously, an increase in the geomembrane liners market due to the EPA coal ash disposal ruling.
- promoting usage of geosynthetics in the oil and gas market for infrastructure applications.In July 2014, the U.S. Congress passed the Highway and Transportation Funding Act of 2014. This legislation went into effect in October 2014, stemming off insolvency of the Highway Trust Fund that was due to run out of funds. The bill extends federal funding for highway and bridge infrastructure projects through May 31, 2015. Once the bill expires on May 31, rather than again just extending current funding, perhaps Congress will seek more of a long-term fix and attempt to use corporate tax reform or some other non-transportation related funding mechanism to keep the Highway Trust Fund (HTF) solvent for a few years.WRRDAWRRDA is important to the geosynthetics market for a variety of reasons. Of particular importance is the law’s section titled “Use of innovative materials”: … including the use of geosynthetic materials … in carrying out the activities of the Corps of Engineers. Geosynthetics are now evaluated as a component for current and future water-related projects such as flood control, water navigation, and dam and levee safety.On Dec. 19, 2014, the EPA announced the first national regulations for the disposal of coal ash generated from coal-fired power plants. The rule, which establishes safeguards to prevent groundwater contamination and air emissions from coal ash disposal sites, was first considered after a 2008 disaster in Kingston, Tenn., that dumped 5.4 million cubic yards of coal ash into two rivers in what remains the largest spill in U.S. history.ProjectionsThe U.S./Canadian geomembrane market was valued at $1.1 billion in 2014. Key markets in the geomembrane market include infrastructure construction (roads and bridges), the waste management market, and mining. The geomembrane market is expected to grow at 8–10% per year from 2015 to 2018 and could reach $1.9 billion by 2018. The mining industry has spurred growth in the geomembrane market in the U.S. and Canada, especially with the surge in the U.S. shale gas extraction market in recent years.
- The slow economy during the past few years in the U.S. had an adverse effect on the growth of the geosynthetics market. But a steady, improved economy is expected to help propel the geosynthetics market toward an annual growth rate of 4–5% in the next few years.
- The U.S. geosynthetics market is expected to achieve a growth rate of 4% in 2015. Facilitating this growth is the U.S. transportation infrastructure construction market, which is expected to grow 3.1% from $185.9 billion in 2014 to $191.7 billion in 2015. Airport runway and terminal construction is expected to increase 5% to $13.1 billion in 2015; bridge and tunnel construction is expected to grow 2% from $30.8 billion in 2014 to $31.3 billion in 2015.
- The issue gained further traction last year when a Duke Energy pipe burst, spewing six decades of coal ash waste—as estimated 30,000–40,000 tons—into the Dan River in North Carolina. IFAI estimates there are at least 535 U.S. coal ash sites that now will require new liners to prevent coal ash slurry from contaminating drinking water. With stronger oversight of coal ash disposal by the EPA, enforcing these coal ash sites to require liners could mean $300 million to $350 million in sales for the U.S. geosynthetics market during the next 5–7 years.
- Coal ash
- On June 10, 2014, President Obama signed into law the Water Resources Reform and Development Act (WRRDA). Included in WRRDA is first-ever geosynthetics language in a U.S. law—a long-sought collective effort by the Geosynthetic Materials Association (GMA) and its allies. The new law provides funds for flood control, water navigation, storm damage reduction, ecological restoration, water supplies, dam and levee safety, and more.
- The Transportation Act did help the U.S. geosynthetic market achieve improved growth in 2014 vs. 2013. The value of highway, street, and bridge construction in 2014 was $84.5 billion compared to $81.2 billion in 2013—up 4% over 2013. Highway, street, and bridge construction spending in 2015 is expected to be up 3% over 2014 at just over $87 billion.