Is a Glass Shortage on the Way?

Is a glass shortage on the way? The answer, according to representatives from several North American primary glass manufacturers, is "no." In fact, indications from the state of the glass and glazing market today would point to just the opposite.

Fred Wallin, vice president of marketing for AFG in Kingsport, Tenn., doesn't believe there will be a glass shortage in the near future. "There is still a lot of demand in the market and I expect that demand will continue to grow at about a 2-percent rate," says Wallin, a 20-year veteran of the glass industry. "With Cardinal's new float glass capacity coming online this fall, overall demand for 2007 should be about the same as this year.

"The slowing of the market is due, in part, to a slowdown of housing starts and existing home sales," he continues. A high level of new home inventory, currently 6.6 months, coupled with higher interest rates (forecast for 6.5 percent) in 2007 will continue to slow the market. Lower energy costs could put additional dollars in the hands of consumers that could mitigate the slide. However, the commercial market remains robust growing at about a 4- to 8-percent annually and I expect this to continue for the near term [next three years]."

"We have a good market, not a fabulous market, but historically one of the best in recent years," Wallin adds. "I get the sense that next year will be similar to this year, although it will be slower early in the year and finish stronger."

Mauro DiFazio, director of sales and marketing for ACH VersaluxTM Float Glass agrees with Wallin and for many of the same reasons.

"With the slow down in both the residential construction and automotive markets this affords an ample supply of product for future demand in these areas, as well as other segments of the market [commercial], which remain strong. In terms of the impact of other market factors such as energy costs and surcharges, I don't see this having much impact on production or availability of glass now or in the foreseeable future."

"I do not see a shortage of glass at this time," adds Tom Kaiser, president of Cardinal IG in Eden Prairie, Minn. "We are seeing a softening of housing starts and the automotive market is slow so in certain areas one might see some extra glass around. With the opening of our fifth float line in Winlock, Wash., last week, Cardinal has taken steps to ensure that we have glass to support our national customer base.

"With that said," continues Kasier, "we will face some challenges if our market slows further and it will prove to be interesting from a float standpoint. Geographically, in some areas of the county, there could be concern about a glass shortage, but this is more related to the freight component than it is with an actual shortage of product. The reality is that the costs involved in transportation, lack of drivers, diesel surcharges and lack of backhaul, do and will factor into a producer's willingness to transport product over far distances."

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