The Structural Insulated Panels Market Projected to Grow at a CAGR of 5.1% and Generate a Revenue of $638.4 Million by 2028

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The global structural insulated panels market is predicted to be valued at $638.4 million by 2028, surging from $429.0 million in 2020, at a noteworthy CAGR of 5.1%.

COVID-19 Impact on Structural Insulated Panels Market

The coronavirus outbreak has brought several challenges that has affected the demand for structural insulated panels. This is majorly owing to the drastic decline in residential and commercial construction activities that has negatively impacted the structural insulated panels (SIPs) market growth. Some of the key challenges faced by SIPs include delay in the availability of raw materials, contractual obligations, and project delays or postponements. Economic downturn and decline in the number of construction projects have tremendous impact on market growth. Due to increased tendency towards cash savings, majority of the homeowners have cancelled or postponed purchase decisions. Also, work from home regulations imposed by several companies across the world had led to the decline in commercial construction activities. These factors have affected the demand for structural insulated panels (SIPs) market during the COVID-19 pandemic.

However, major structural insulated panels (SIPs) companies have undertaken various measures to protect the health & safety of employees and society. For instance, Owens Corning, leading SIPs manufacturer, is proactively balancing its production across various company’s locations along with the implementation of robust cleaning procedures. Also, the company has maintained its liquidity and financial flexibility by postponing or reducing the capital expenditures and non-critical expenses. Also, the company is adhering to the health & safety protocols issued by World Health Organization, Centers for Disease Control and Prevention (CDC), and local state and government.   

Global Structural Insulated Panels Market Analysis

The growing popularity of structural insulated panels is majorly owing to its use in construction of walls, ceilings, and floors. SIPs are known for high strength, durability, and energy-efficiency. SIPs comprise of rigid foam which is the insulation layer sandwiched between two structural facing materials that endures strength to these panels. Also, SIPs can manage dead loads of up to ten pounds per square feet and live loads of up to seventy pounds per square feet. SIPs can span across the wall up to eighteen feet without the need for any additional support. SIPs are widely used in the U.S. majorly for residential construction since past 30-40 years. SIPs offer excellent protection against snow, wind, and natural disasters due to the presence of tighter envelope that leads to less air leakage and helps in the construction of energy-efficient buildings. These factors are anticipated to drive the structural insulated panels market size in the upcoming years.

However, homes built with SIPs require additional ventilation as heat is trapped inside the house. Due to this, additional vents or extractors are needed to prevent the buildup of condensation that can be a breeding ground for molds. In addition, structural insulated panels (SIPs) are relatively new in the regions namely Europe and Middle East due to which finding the competent and experienced builder can be a challenging task. These factors are anticipated to restrict the structural insulated panels market share during the analysis period.

Structural insulated panels (SIPs) are known for their excellent thermal performance as they offer 50% more energy efficiency compared to traditional timber framing. This is because the building envelope of SIPs has very less thermal bridging that offers airtightness and adheres to the net-zero building standards. Also, excellent indoor air quality is maintained as these panels do not have voids. In addition, SIPs help in meeting sustainability credentials that contributes towards reducing the carbon dioxide emissions. This is because SIPs utilize less energy for manufacturing process and have less embodied energy compared to the traditional construction methods. Fast construction time and less labor cost are achieved as SIP walls and roofs are manufactured offsite due to which they can be quickly assembled onsite. Hence, approximately 55% of labor requirement are reduced as project management, framing labor, scaffolding, and other expenses are reduced. These factors are projected to generate excellent growth opportunities in the market.

Global Structural Insulated Panels Market, Segmentation

The global structural insulated panels market is segmented based on insulation material, facing material, application, end-use, and region.

Insulation Material:

The insulation material segment is further classified into expanded polystyrene (EPS), extruded polystyrene (XPS), and polyurethane. Among these, the expanded polystyrene (EPS) sub-segment is anticipated to have a dominant market share and shall surpass $531.2 million by 2028, with an increase from $350.2 million in 2020. Expanded polystyrene (EPS) is widely used for the construction of SIPs as they can be used for interior & exterior, walls, roof surfaces, and floors. SIPs reduce the need for roof trusses as they have high strength, and they are less susceptible to shifting. They can be used for the construction of duct, cavity wall, void filling, floor insulation, floor raising, as well as for packaging applications. Based on client requirements, EPS can be manufactured in different densities and can be cut & shaped in diverse sizes. These aspects are major drivers to boost the expanded polystyrene (EPS) growth.

Facing Material:

The facing material segment is further classified into oriented strand board (OSB), magnesium oxide board (MgO), and others. Among these, the oriented strand board (OSB) structural insulated panels sub-segment is anticipated to have a dominant market share and shall surpass $427.0 million by 2028, with an increase from $279.8 million in 2020. This is because OSB has strength properties similar to plywood and they are known for their longevity and durability. Also, OSB can resist racking, distortion, delamination, and deflection as they are dimensionally stable. OSBs are easy to install and manage as they are lightweight. In addition, the wood fibers used for manufacturing OSB are grown in sustainable tree farms and forests due to which sustainability is achieved. These factors make OSB a proven choice for its use as a facing material in manufacturing of SIPs.

Application:

The application segment is further classified into walls, ceilings, and floors. Among these, the walls sub-segment is anticipated to have a dominant market share and shall surpass $382.3 million by 2028, with an increase from $250.5 million in 2020. SIPs are widely used for construction of walls as they provide comparatively quieter environment than the traditional framing that helps in achieving soundproofing design for walls. With the use of SIPs, equivalent U-values can be achieved with thinner walls. Also, SIPs help in building superior walls as they are stronger and less susceptible to shifting compared to traditional wood framing. For instance, Kingspan Group, the leading building materials company, offers Kingspan wall product range that comprises of advanced insulation and daylighting products with tested and certified ventilation solutions and facade systems.

End-use:

The end-use segment is further classified into residential and commercial. Among these, the residential sub-segment is anticipated to have a dominant market share and shall surpass $542.7 million by 2028, with an increase from $357.1 million in 2020. SIPs are widely used in residential construction as they offer uniform and superior insulation and offer energy saving of 12% to 14%. The demand for residential construction is driven by rapid urbanization, growing household income, and rising population especially in developing countries such as India, China, Australia, and others.

Region:

The structural insulated panels market in the Europe region is anticipated to witness rapid growth. This region’s market generated a revenue of $82.8 million in 2020 and is projected to reach up to $129.3 million by 2028. This growth is majorly owing to the rising demand for urban development and sustainable construction activities. For instance, SIPs are manufactured offsite and finished components are completely produced in controlled environment that minimizes the risk of hazardous waste on-site. Also, high-precision manufacturing techniques and intelligent inventory system is utilized that optimizes the use of materials required for manufacturing SIPs and the waste generated during the process is fully recycled. The presence of lower embodied energy helps in lowering the CO2 emissions. Thus, excellent durability, performance, energy savings, and ease of maintenance are the major factors that drive the sustainability. These factors are major drivers to boost the Europe structural insulated panels market size during the forecast period.       

Key Players in the Global Structural Insulated Panels Market

Some of the leading structural insulated panels market players are

1. Owens Corning
2. Kingspan Group
3. Enercept, Inc.
4. Alubel SpA
5. American Insulated Panel Company (AIP)
6. Premier Building Systems, Inc.
7. Extreme Panel Technologies, Inc.
8. T. Clear Corporation
9. ACME Panel Company
10. Ingreen Systems Corp.

Along with the company profiles of the key players in the market, the report includes the Porter’s five forces model that gives deep insights into the competitive environment of the market.

Porter’s Five Forces Analysis for the Global Structural Insulated Panels Market:

• Bargaining Power of Suppliers: Considerable number of companies operating in structural insulated panels market are dependent on suppliers for purchase of raw materials such as insulation panels, wood-composite boards, and facing materials. Due to this, the bargaining potential of suppliers increases as they are in the dominant position. 
  Thus, the bargaining power of suppliers is high.
• Bargaining Power of Buyers: In this market, the concentration of buyers is increasing gradually as SIPs are new in the construction sector especially in European, Asia-Pacific, and Latin America region. As this market is relatively new, the bargaining power of buyers is moderate owing to slowly evolving demand for SIPs.
  Thus, buyer’s bargaining power will be moderate.
• Threat of New Entrants: The threat of new entrants is moderate as the emerging companies are focusing on business expansion, partnerships, and new projects to boost their market presence. 
  Thus, the threat of the new entrants is moderate.
• Threat of Substitutes: The presence of alternatives such as traditional wooden framing, timber framing, and spray foam which are quite popular increases the threat from substitution. 
  Thus, the threat of substitutes is high.
• Competitive Rivalry in the Market: The structural insulated panels market players are focusing on acquiring new projects to grow their consumer base, investments, and partnerships to maintain their market presence and to gain competitive advantage. 
  Therefore, competitive rivalry in the market is high.