Imports Mid ’09: Less of the Same

November 18, 2009

Imports through the first six months of 2009 show at least one positive – things aren’t (for most stone types) getting worse. The overall numbers, though, indicate that the amount of stone coming into this country is down from 2007 – the market peak – by almost half.

Not all stone types took a massive drop. But, it’s granite and travertine – the market drivers for the go-go years of the mid-2000s – that’s fallen on hard times.

U.S. import figures show what could be a telling trend from the past three years. The first six months of 2007 through 2009 show remarkably similar patterns for the value of stone shipments and, by proxy, the overall condition of the stone market.

The problem is that the tonnage figures also ratchet down each year. Im other words, it’s starting to look like 2009 is business as usual as far as the pattern of demand … but the amount of business is running at a lower level than in the past, with no indication of a market upturn

TOEING THE TREND LINE

Gleaning trends on the U.S. dimensional-stone industry from import data may seem a bit roundabout, but the shipping figures are the best – and, for the most part, only – way to measure the market. Imports provide up to 85 percent of the dimensional-stone market – the amount that can be traced to its source, at least – so what comes into U.S. ports is likely the best barometer of domestic stone trade.

For most of the 2000s, looking at the import numbers from the U.S. Departments of Commerce and Homeland Security and the U. S. International Trade Commission became more of an international horse race, as countries tallied record tonnage and import values of products. For most, the only direction possible with each report was up.

The climb continued until 2007, but that year’s totals showed a diminished growth rate, which can portend a market drop. The sinking feeling came last year, fed by a cornucopia macabre of mortgage foreclosures, residential and commercial construction slowdowns, tightened credit and business failures. While that’s the story for most U.S. industries, it hit particularly hard for the stone trade.

The first-half of this year continued in a business funk. For those following the occasional StatWatch of the Editor’s Blog at Stone Business Online, monthly figures on volume and value continued to trail last year by a wide margin.

Evaluating by month-to-month snapshots rarely results in a clear picture of the market, though. As totals get smaller, one large shipment or project can take a month out of proportion. And, looking at succeeding months doesn’t give any scope to market performance.

Instead of concentrating solely on half-year totals – we’ll get to that a little later – let’s take a look at data by timeline during the past three years … literally from boom to bust.

When comparing all dimensional-stone import values – the amount declared when bringing the material into the U.S. – the timelines show similar patterns. While there are some variances, the general direction of down in February followed by growth through the spring runs at about the same rate.

The problem, though, is that the same trend occurs annually as the market continues to shrink. The import-value total of $163.8 million for January 2009 is only 59.5 percent of 2007’s $275.3 million. And, while the two years seem to parallel each other through six months, June 2009’s $152.8 million is barely more than half of the $292.7 million of import value in June 2007.

It’s also worth noting that June 2009’s total is less than January 2009 – something that didn’t happen in better years like 2007 – which doesn’t bode well, as demand should be up for spring and early summer construction and remodeling. The low totals in import values may also reflect higher stocks of stone, due to large amounts bought at last fall.

Import values can be manipulated with by constant price changes. The volume of stone imports is a more-tangible measure – a ton is always a ton – but comparing the first half of 2009 with the boom year of 2007 shows a wide gap in stone moving through U.S. ports-of-entry.

Frankly, the chart on “worked” (slab/tile) granite import tonnage on page xx isn’t a time line, as the results look less shocking as a comparative bar graph. It’s apparent that, even in the best months of first-half 2009, it’s a struggle to reach the halfway mark of comparable months in 2007.

For the record, worked granite imports for the first six months of this year came to 501,181 metric tons; that’s only 42.8 percent of the 1,168,778 metric tons of granite brought in for the first half of 2007.

GRANITE

Just about anyone in the stone industry would settle for getting back to last year’s level of business, let along the high point of 2007. If worked granite imports are any indication, though, the market is a large number of tall orders away from climbing to pre-meldown levels.

Granite import values added up to $347.7 million for the first half of 2009. When compared to the $603.5 million of granite brought in during January-June 2008, the dollar value of this year’s shipments is only 56.7 percent of 2008’s s totals.

Granite’s Big Four – Brazil, China, India and Italy – took a hit in the value of goods sent to the United States. Brazil retained its top position, but the $115.1 million from first-half 2009 is a 43.9-percent drop from the same time last year. China solidified a close second at $107.2 million, suffering only a 26.2-percent decline.

The remaining set of the quartet didn’t fare as well. Italy’s $48.9 million from first-half 2009 is a 55.3-percent slide from the same time; India’s first-half 2009 came to $46.4, a 51.2-percent drop from the previous year.

When it comes to volume, the 501,181 metric tons of granite received in U.S. ports during the first half of this year represented a 45.1-percent drop from same time in 2008. Brazil kept its top position with 161,416 metric tons for first-half 2009, but that’s a 29.9-percent decline. China, the top importer in first-half 2008, slid into second this year with a 52.7-percent drop to 140,756 metric tons.

India also took a big chop, as its 98,820 metric tons for January-June 2009 accounted for a 53.5-percent reduction from first-half 2008. Italy, meanwhile, saw its U.S. granite shipments drop by 66.9 percent with its 34,648 metric tons in this year’s first half.

As seen at the end of last year, price-per-ton averages varied across the board from month to month. At this year’s halfway point, China managed to gain some financial muscle; its per-metric-ton value for granite came to $762, a major hike from the $489 average of January-June 2008. India also managed to squeeze a few more dollars out of the market, with a per-metric-ton average of $496 compared to 2008’s $448.

Italy’s drop in value and tonnage conversely gave a nice boost to its per-metric-ton average, with the $1,341 of first-half 2009 representing an almost-$200 rise. Brazil came in as the only major granite supplier to show a drop in per-metric-ton averages for January-June, with a $172 cut from 2008 to this year’s $713.

MARBLE

Last year, marble imports appeared to be recession-resistant in retaining or gaining market share in dimensional stone. This year, however, the marble trade is taking a loss, although not as severe as granite.

The value of U.S. worked-marble imports totaled $91.3 million for first-half 2009, down 35.6 percent from the same time last year. Italy, the perennial leader in marble imports, led once again with $40.5 million at the halfway point of 2009, but that’s 36.5-percent-less than first-half 2008. China’s mid-year total of $17.6 million, meanwhile, represented only a 13.1-percent drop from the same time last year.

Other major importers fared worse, as Spain’s $7.6 million in half-year worked-marble value for 2009 resulted from a 60.6-percent dive from mid-year 2008. Turkey’s $7.5 million also showed a major loss (31.7 percent) from first-half 2008; fifth-place Greece came in at $5.5 million, running only 4.9 percent off of mid-point last year.

The 77,838 metric tons of worked marble coming here in first-half 2009 represented a 30.9-percent decline from January-June 2008. China, however, managed to buck the downward trend – its 23,615 metric tons managed to edge ahead of mid-year 2008 totals by 1.5 percent.

Italy, meanwhile, fell 35.5 percent to 21,564 metric tons of worked-marble imports for mid-year 2009. Turkey slid 27.4 percent to 8,231 metric tons; Spain took a 51.6-percent hit from 2008 with this year’s half-year total of 8,231 metric tons. Greece’s 2,341 metric tons showed a 27.1 drop from mid-year 2008.

TRAVERTINE

Turkey, the dominant country in travertine, continued to reduce value and volume of the stone flowing to the United States during the first half of 2009. Nobody moved in to pick up the slack, either.

The $123.6 million in total U.S. travertine imports in January-June this year marked a 39.5-percent slide from the same time in 2008. More than two-thirds of that total – $79.4 million – came from Turkey, and it’s not surprising the country took a 37-percent hit from 2008’s mid-year import values.

Other travertine-shipping countries fared worse; Mexico’s mid-year mark in U.S. import values fell 43.4 percent to $21.9 million, and Italy’s $8.9 million represented a 44.7-percent drop. Peru fell by 53.4 percent to $4.9 million at midpoint this year; it also slid from fourth to fifth, as China suffered only an 11.8-percent loss from mid-2008 with this year’s $5.1 million.

In this year’s first six months, U.S. travertine imports came to 211,358 metric tons – a 48.7-percent drop from the same time in 2008. Turkey again made up the lion’s share of this year’s imports with 150,697 metric tons, which represented a 50.9-percent loss from first-half 2008.

Mexico’s 32.957 metric tons of travertine exports to the United States by mid-year 2009 represented a 31-percent decline from the same time last year. Peru saw a drastic slide of 71.1 percent to 5,801 metric tons, while Italy dropped 63.2 percent this year with 6,931 metric tons.

China, meanwhile, won’t rival Turkey as a major player – but the 6,509 metric tons of travertine shipped to the United States through this June marked a 19.9-percent increase from mid-year 2008.

OTHER STONE

Other calcareous stone –limestone, plus onyx and alabaster – tallied $59.3 million in U.S. imports through the first six months of 2009, marking a 44.2-percent decline from the same time last year. Italy led the category at $10.4 million, down 44.6 percent from mid-year; Lebanon, a major player last year, dropped 66.9 percent to $3.1 million at the end of June.

China and India continued the competition for the lead in U.S. slate imports at mid-2009, with China taking the honor at $13.5 million to India’s $11.3 million; unfortunately, both registered import values of $19.2 million at the same time last year. The entire U.S. slate import value for the first half of this year came to $28.7 million, down 39.2 percent from the previous year.

The omnibus “other stone” category, including all non-classified stone types, suffered the least in the first six months of 2009 – although that’s slight comfort. The $87.1 million in mid-2009 other stone value represented a 34.3-percent decline, as India maintained the top position at $24.3 million and Brazil in second at $20.4 million.

Data for this article, and for accompanying charts, is derived from information reported by the U.S. Department of Commerce, the U.S. Treasury and the U.S. International Trade Commission. All analysis is made using comparable data. “Worked” data excludes crude/roughly trimmed stone comprised of marble/travertine, granite or other categories where volume measurement is in cubic meters instead of metric tons. Marble/travertine crude/roughly trimmed stone data is not included in value summaries, since the two stones are not delineated in the Harmonized Tariff Schedule of the United States (2002) (Revision 2).