Emerging Trends in the North American Building Materials Market! Favorable Analysis of China’s Foreign Trade in the North American Building Materials Market

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Urbanization process

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In the U.S. real estate market, second-hand home transactions dominate, with new home sales accounting for no more than 20% of existing home sales overall since 1999, and second-hand home transactions accounting for more than 80%. Owners of second-hand homes often undertake partial renovations, replace home furnishings, and engage in other improvement activities to enhance living comfort and property value. As the median age of U.S. homes increases, with nearly half built before 1980, the demand for renovating these second-hand homes is particularly strong, thereby stimulating the demand for various home improvement materials.

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New residential buildings

In the United States, the DIY (do-it-yourself) approach is quite common for minor home repairs and renovations. However, as homes age, the repair and renovation needs become more complex and professional, leading to a growing trend of hiring professionals for repairs and renovations. By 2021, professional contractors accounted for 61% of the market. This shift not only drives demand for various high-quality building materials but also prompts suppliers to focus more on the professionalism and applicability of their products to meet the needs of the professional repair and renovation market.

Cost Advantage

Price Competitiveness: According to the 2023 trade data from the U.S. Census Bureau, using "unit value" (import dollar value divided by quantity) as a proxy indicator for price, China is the cheapest supplier for 29% of products in the U.S., far surpassing other countries. In the building materials sector, China, with its mature industrial system, large-scale production capacity, and relatively low labor costs, can offer various building materials products to the North American market at more competitive prices. For example, Chinese-produced tiles, sanitary products, hardware accessories, etc., have a clear price advantage compared to North American domestic products and products from other import source countries. This makes Chinese building materials products more appealing to price-sensitive consumers in the North American market.

The advantages of supply chain integration: China has a comprehensive and highly integrated building materials supply chain, with close coordination across all stages from raw material procurement, production and processing, to product transportation, effectively reducing production costs. Numerous building materials manufacturers are concentrated in specific regions, forming an industrial cluster effect that further enhances production efficiency and reduces logistics costs. This supply chain integration advantage enables Chinese building materials companies to offer products to the North American market at relatively low prices while ensuring product quality, thereby enhancing the price competitiveness of Chinese building materials in the North American market.

(2) A wide variety of products

Comprehensive Category Coverage: China's building materials industry is highly developed and can produce almost all categories of building materials. This ranges from basic structural materials such as steel, cement, and wood, to various decoration and finishing materials like ceramics, glass, and coatings, as well as hardware, kitchen, and bathroom products. The North American market has a diverse demand for building materials, whether it be large-scale infrastructure projects or small home renovation projects, the corresponding products can be found in China. This advantage of comprehensive category coverage allows North American buyers to achieve one-stop procurement in China, significantly reducing procurement costs and time.

Customization Capability: With the increasing personalized demands of consumers, Chinese building material companies are continuously enhancing their product customization capabilities. For the unique needs of different customers in the North American market, such as distinctive design styles, size specifications, and functional requirements, Chinese companies can respond quickly and provide customized building material products. In the field of architectural doors and windows, Chinese companies can produce customized products that meet North American customers’ personalized requirements for thermal insulation, soundproofing, appearance design, and other aspects, thereby satisfying the diverse consumer demands of the North American market.

(iii) Supply Chain Resilience

Risk Management Capability: Despite being affected by various factors such as trade frictions and the pandemic in recent years, Chinese building materials companies have demonstrated strong supply chain resilience. During the pandemic, China was among the first to control the outbreak and resume production, becoming a crucial supplier of building materials globally and ensuring the supply to the North American market. Chinese companies effectively addressed various risks and challenges by optimizing supply chain management, strengthening cooperation with suppliers, and expanding raw material supply channels, ensuring that products could be delivered to the North American market on time and in the required quantities.

Trade Channel Diversification: To reduce trade risks, Chinese building materials companies are actively expanding their trade channels. In addition to traditional trading methods, they are also increasing their investment in emerging fields such as cross-border e-commerce. By establishing online sales platforms and collaborating with internationally renowned e-commerce platforms, Chinese building materials products can more directly reach North American consumers and buyers, reducing intermediaries and improving trade efficiency. Meanwhile, Chinese companies are also strengthening cooperation with local distributors and retailers in North America, further consolidating and expanding their market share through localized operations.