The construction industry is a very important part of the European economy, creating billions of revenue every year. Meanwhile, Europe is one of the most attractive regions worldwide for investments in real estate, with a huge real estate market and sustained growth in property demand. However, due to Europe’s cold climate, building insulation has been an essential issue. Polyurethane, as a high-quality insulation material, has become the mainstream choice for the European construction industry.

Application of Polyurethane in Building Insulation

In Europe, thermal insulation has become a necessary requirement on buildings. Polyurethane foam is widely used in the European construction industry owing to its excellent insulation performance, light weight, durability, and easy installation. It can be used as an insulation material in various types of buildings such as residential, office, industrial, and commercial buildings, etc., and can be applied to various types of walls, roofs, and floors, etc. with great flexibility in installation.

Advantages of Polyurethane as Building Insulation Material

Polyurethane, as a building insulation material, has several main advantages:

1. Excellent insulation performance: The thermal conductivity of polyurethane foam is very low, which provides strong insulation performance and can effectively reduce the transmission of indoor temperature to the external environment, thereby reducing the use of indoor air conditioning.

2. Lightweight and easy to install: Polyurethane foam is very lightweight, easy to transport and install, and can be customized according to actual needs, which is more in line with the requirements of building design.

3. High durability: Polyurethane foam has excellent durability, can be used for many years without being affected, and effectively protects building walls, roofs, and floors.

Upstream Analysis

The demand for polyurethane in Europe has been on the rise in recent years, especially the significant increase in demand for polymeric MDI in the construction industry. This is mainly due to its environmentally friendly and sustainable characteristics, which make it popular in the European market. China exported 18,418 tonnes of polymeric MDI to the Netherlands, a year-on-year increase of 66.5%, with a 22.6% share of China’s total export. Meanwhile, export volumes of polymeric MDI from China to Belgium, Turkey, and Russia over the same period showed even stronger year-on-year growth, all with three-digit growth rates. The export volume of polymeric MDI from China to Belgium increased 610.1% year-on-year, to Turkey increased by 146.4% year-on-year, and to Russia increased by 317.1% year-on-year.

Figure 1: Volumes & YoY Changes of China’s PMDI Exports to the Netherlands, Belgium, Russia and Turkey, March 2022 vs 2023

Data Source: Customs Data

Downstream Analysis

In February 2023 compared with January 2023, seasonally adjusted production in the construction sector increased by 2.3% in the euro area, according to first estimates from Eurostat. In January 2023, production in construction rose by 3.8% in the euro area. In February 2023 compared with February 2022, production in construction increased by 2.3% in the euro area. Moreover, Eurostat’s report indicates that the order volume of the construction industry has returned to the level before the pandemic, and the problems of labor shortages and high prices of building materials have been gradually eased.

Figure 2: Construction Market Value & MoM Changes in Euro Area, 2022-2023

Data Source: Eurostat

Summary

As the European construction and real estate market keep growing, building insulation has become a very important issue. Polyurethane foam, as a high-quality thermal insulation material, has been widely used in the European construction industry. Owing to its excellent insulation performance, light weight, durability, and easy installation, it can be used in various types of buildings. In the future, with the continuous advancement of technology and the increasing demand for environmental protection and energy conservation, the application prospects of polyurethane foam in European building insulation will be even broader.