Refractories Manufacturing

NESHAP: Industry Profile,

Methodology, and Economic
Impact Analysis

Draft Report

Prepared for

Lisa Conner
U.S. Environmental Protection Agency
Office of Air Quality Planning and Standards
Innovative Strategies and Economics Group (MD-15)
Research Triangle Park, NC 27711

EPA Contract Number 68-D-99-024

RTI Project Number 7647.002.138

March 2001
EPA Contract Number RTI Project Number
68-D-99-024 7647.002.138

Refractories Manufacturing
NESHAP: Industry Profile,
Methodology, and Economic
Impact Analysis

Draft Report

March 2001

Prepared for

Lisa Conner
U.S. Environmental Protection Agency
Office of Air Quality Planning and Standards
Innovative Strategies and Economics Group (MD-15)
Research Triangle Park, NC 27711

Prepared by

Katherine B. Heller
A. Michelle Bullock
Research Triangle Institute
Center for Economics Research
Research Triangle Park, NC 27709
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CONTENTS

Section Page

1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-1

2 The Supply Side . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-1

2.1 Production Process, Inputs and Outputs . . . . . . . . . . . . . . . . . . . . . . . . 2-1

2.1.1 Machines Used in the Production Process . . . . . . . . . . . . . . . . . 2-4
2.1.1.1 Mixing/Kneading Machines . . . . . . . . . . . . . . . . . . . . 2-4
2.1.1.2 Presses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-4
2.1.1.3 Kilns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-7
2.1.2 Final Commodities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-8
2.1.2.1 Shaped Refractories . . . . . . . . . . . . . . . . . . . . . . . . . . 2-8
2.1.2.2 Unshaped Refractories . . . . . . . . . . . . . . . . . . . . . . . . 2-8
2.1.3 Emissions and Controls in Refractory Manufacturing . . . . . . . 2-10
2.1.3.1 PM and Metals Emissions . . . . . . . . . . . . . . . . . . . . . 2-10
2.1.3.2 Gaseous and VOC Emissions . . . . . . . . . . . . . . . . . . 2-10
2.1.4 Inputs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-10
2.1.4.1 Clays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-10
2.1.4.2 Nonclays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-12

2.2 Types of Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-12

2.3 Costs of Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-12

2.3.1 Cost Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-12

2.4 Supply Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-14

3 The Demand Side . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3-1

3.1 Product Characteristics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3-1

3.2 Uses and Consumers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3-1

3.3 Substitution Possibilities in Consumption . . . . . . . . . . . . . . . . . . . . . . . 3-4

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4 Industry Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-1

4.1 Refractory Manufacturing Plants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-1

4.1.1 Refractories Database Facilities . . . . . . . . . . . . . . . . . . . . . . . . . 4-1
4.1.2 Facility Location . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-1

4.2 Capacity Utilization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-9

4.3 Industry Concentration and Market Structure . . . . . . . . . . . . . . . . . . . 4-11

4.3.1 Measures of Industry Concentration . . . . . . . . . . . . . . . . . . . . 4-12
4.3.2 Market Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-13

4.4 Current Trends in the Refractory Industry . . . . . . . . . . . . . . . . . . . . . . 4-13

5 Markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-1

5.1 Market Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-1

5.1.1 Domestic Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-1
5.1.2 International Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-1

5.2 Market Prices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-3

5.3 Industry Trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-4

References . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . R-1

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LIST OF FIGURES

Number Page

2-1a Refractory Manufacturing Process Flow Diagram . . . . . . . . . . . . . . . . . . . . . . . 2-2

2-1b Specific Production Processes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-3
2-2 Scheme of Mixer and Kneading Machines . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-5
2-3 Vacuum Press (Friction, Hydraulic Press) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-6
2-4 Friction Press (A), and Hydraulic Screw Press (B) . . . . . . . . . . . . . . . . . . . . . . 2-6
2-5 Vibrating Press . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-6
2-6 Cross Section of CIP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-6
2-7 Tunnel Kiln . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-7
2-8 Round Kiln and Downdraft System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-8
2-9 Shuttle Kiln . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-8

4-1 Location of Refractory Manufacturing Facilities . . . . . . . . . . . . . . . . . . . . . . . 4-10

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LIST OF TABLES

Number Page

2-1 Types and Descriptions of Refractories Produced . . . . . . . . . . . . . . . . . . . . . . . 2-9

2-2 Types and Characteristics of Raw Materials used in Refractory
Manufacture Type . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-11
2-3 Labor, Material, and New Capital Expenditures for Clay Refractory
Manufacturers (NAICS 327124) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-13
2-4 Labor, Material, and New Capital Expenditures for Nonclay
Refractory Manufacturers (NAICS 327125) . . . . . . . . . . . . . . . . . . . . . . . . . . 2-14
2-5 Costs of Materials Used in Refractory Production and Manufacture . . . . . . . 2-16

3-1 Characteristics and Types of Refractories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3-2

3-2 Steel and Nonferrous Production (103 Metric Tons) . . . . . . . . . . . . . . . . . . . . . 3-4

4-1 Selected Refractory Manufacturers, by Type . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-2

4-2 Number of Refractory Manufacturing Facilities by State . . . . . . . . . . . . . . . . . 4-9
4-3 Full Production Capacity Utilization Rates for Clay and Nonclay
Refractories: Fourth Quarters 1993 through 1998 . . . . . . . . . . . . . . . . . . . . . 4-11
4-4 Market Concentration Measures for SIC 3255 Clay Refractory
Manufacturing and SIC 3297 Nonclay Refractory Manufacturing . . . . . . . . . 4-12

5-1 Production of Refractories: 1977–1998 ($106) . . . . . . . . . . . . . . . . . . . . . . . . . 5-2

5-2 Exports and Imports of Refractories: 1993–1999 ($106 1998) . . . . . . . . . . . . . 5-3
5-3 Average Price for Refractory Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-3

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SECTION 1

INTRODUCTION

The U.S. Environmental Protection Agency’s (EPA’s) Office of Air Quality Planning
and Standards (OAQPS) is compiling information on refractory manufacturing plants as part
of its responsibility to develop National Emission Standards for Hazardous Air Pollutants
(NESHAP) under Section 112 of the 1990 Clean Air Act. The NESHAP is scheduled to be
proposed in 2001. This industry profile of the refractory manufacturing industry provides
information to support the regulation.

A refractory is a material that retains its shape and chemical identity when subjected
to high temperatures and is used in applications that require extreme resistance to heat.
Specifically, refractories must be able to withstand temperatures above 538°C (1,000°F).
Refractories are mechanically strong and heat resistant to withstand rapid temperature
change and corrosion and erosion by molten metal, glass, slag, and hot gas. Refractories are
used in kilns, furnaces, boilers, incinerators, and other applications.

Refractory manufacturing falls under the North American Industry Code System
(NAICS) 327124 for clay refractories and NAICS 327125 for nonclay refractories.
According to the 1997 Census of Manufactures, 149 establishments owned by 115
companies manufactured clay refractories, and 124 establishments owned by 90 companies
manufactured nonclay refractories in 1997 (U.S. Department of Commerce, 1999b, 1999c).
In 1998, the refractory industry employed 13,709 people and shipped products valued at over
$2.6 billion (U.S. Department of Commerce, 2000).

The primary pollutants in the refractory industry are particulate matter (PM). These
emissions occur during the crushing, grinding, screening, calcining, and drying phases of
refractory manufacture. Other pollutants include sulfur dioxide (SO2), nitrogen oxide (NOx),
carbon monoxide (CO), carbon dioxide (CO2), hydrogen fluoride (HF) and volatile organic
compounds (VOCs). The NESHAP will most directly affect facilities that produce organic-
bonded products that include resins, pitch, and other organics in addition to refractory
materials. The pitch-impregnated refractory manufacturing process is expected to be
regulated for polycyclic organic matter (POM) during a thermal processing step.

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This industry profile report is organized as follows. Section 2 provides a detailed

description of the production process for refractories, with discussion of individual refractory
products, inputs, and costs of production. Section 3 describes the characteristics, uses and
consumers of refractories, and substitution possibilities. Section 4 discusses the organization
of the industry and provides facility- and company-level data. In addition, small businesses
are reported separately for use in evaluating the impact on small business to meet the
requirements of the Small Business Regulatory Enforcement and Fairness Act (SBREFA).
Section 5 contains market-level data on prices and quantities and discusses trends and
projections for the industry.

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SECTION 2

THE SUPPLY SIDE

Estimating the economic impacts associated with the options to regulate the
refractory manufacturing industry requires characterizing the industry. This section
describes the production process, inputs, and outputs of this process. In addition,
characterizing the supply side of the industry involves describing various types of refractory
products, by-products, and input substitution possibilities. This section describes costs of
production and economies of scale.

2.1 Production Process, Inputs, and Outputs

The manufacturing process for refractories depends on the particular combination of

chemical compounds and minerals used to produce a specified level of thermal stability,
corrosion resistance, thermal expansion, and other qualities. Refractory manufacturing
involves four processes: raw material processing, forming, firing, and final processing.
Figure 2-1a illustrates the basic refractory manufacturing process and Figure 2-1b depicts
specific product production processes for various refractory products. The production of
refractories begins with processing raw material. Raw material processing involves crushing
and grinding raw materials, classifying by size, calcining, and drying. The processed raw
materials may then be dry-mixed with other minerals and chemical compounds, packaged,
and shipped as product.

Following the mixing process, the raw materials are formed into desired shapes. This
process typically occurs under moist or wet conditions. After the refractory is formed, the
material is fired. Firing involves heating the refractory material to high temperatures in a
periodic batch or continuous tunnel kiln to form a ceramic bond. This process gives the raw
materials their refractory properties. The final processing stage includes milling, grinding,
and sandblasting the finished product. For some products, final processing may also include
impregnation with tar and pitch and product packaging (The Technical Association of
Refractories, Japan, 1998).

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Figure 2-1a. Refractory Manufacturing Process Flow Diagram

2-2
 Raw Materials Bulk Graphite Graphite
Graphite Refractories Refractories

Graphite Graphite
Mixing Machining Purification
Manufacturing Refractories

Mortars Bulk Fiber

Unformed/Monolithics/ Reformed Refractory Ceramic
Castables Fiber Blankets
Specialties Refractories Fiber
Ramming Mixes Formed Fiber
(clay and non-clay) (clay and non-clay) (RCF)
Cements Products

Organic-Bonded Inorganic-Bonded Fused-Cast

Bricks & Bricks &

Resin-Bonded Pitch-Bonded Other Organics Drying Melting
Shapes Shapes

Slide gates
Bricks & Bricks & Bricks &
Bricks & Curing Drying Drying Firing
Shapes Shapes Shapes

Figure 2-1b. Specific Production Processes

Shapes

2-3
Tubes
Slide gates Bricks & Bricks &
Firing Firing Firing
Bricks & Shapes Shapes
Shapes
Process Operations
Pitch-Impregnated

Refractory Classes
Bricks &
Impregnation
Shapes
Products Bricks & Shapes

Slide gates
Coking
Other Shapes
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2.1.1 Machines Used in the Production Process

Several types of machines are used to produce refractories: mixing/kneading

machines, presses, and kilns.

2.1.1.1 Mixing/Kneading Machines

Figure 2-2 illustrates different machines used to mix or knead refractory products.
There are two types of mixing and kneading machines: fixed vessel and driven vessel.
Mixing homogenizes more than two types of bulk materials, and kneading machines make a
uniform coating layer. Mixing and kneading machines are equipped with mixing blades or
muller wheels. Heating, cooling, or de-airing equipment may also be applied to the vessel.
Mixing and kneading machines are used for manufacturing shaped and unshaped refractories.
Unshaped refractories, however, are not processed any further (The Technical Association of
Refractories, Japan, 1998).

2.1.1.2 Presses

Refractory pressing machines are broadly categorized into three groups: impact and
static, vibrating, and cold isostatic press. Choosing between the three groups of presses
largely depends on the type of raw materials used.

& Impact and Static Presses: Figure 2-3 illustrates a friction and a hydraulic screw
press, two types of impact presses. Figure 2-4 is a diagram of a hydraulic screw
press, a type of static press. Impact and static presses are typically equipped with
a vacuum deaerator. Impact presses have a higher allowable maximum
compacting force than static presses. However, static presses are finding
increasing application in the production of sophisticated refractories such as
submerged nozzles and shrouds and in the production of industrial ceramics.
Bricks formed with static presses are flat, uniform and, compact. (The Technical
Association of Refractories, Japan, 1998).

& Vibrating Press: Vibrating presses, shown in Figure 2-5, are classified into two
types: air cylinder type and hydraulic cylinder. The vibrator in the air cylinder
type is attached to the table, and the air cylinder compacts the material. The
hydraulic vibrating press is constructed with the hydraulic pulse generator
attached to the pressure block, and the hydraulic cylinder compacts the material.
Vibrating presses are typically used for the compaction of complexly shaped
refractories (The Technical Association of Refractories, Japan, 1998).

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Figure 2-2. Mixing and Kneading Machines

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Figure 2-3. Vacuum Press Figure 2-4. Friction Press (A), and Hydraulic
(Friction, Hydraulic Press) Screw Press (B)

Figure 2-5. Vibrating Press Figure 2-6. Cross Section of CIP

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& Cold Isostatic Press (CIP): A CIP, illustrated in Figure 2-6, is a molding device
that provides homogeneous hydrostatic pressure over the entire surface of a
rubber mold filled with powder. This method, also referred to as a hydrostatic
press or a rubber press method, is a materials processing technique in which
processing in which high fluid pressure is applied to a powder part at ambinet
temperature to compact it into a predetermined shape. The power part is
consolidated into a dense compacted shape. Water or oil is usually used as the
presser medium. CIPs are based on either the wet bag method, where the mold is
placed in pressurized liquid, or the dry bag method, in which the mold does not
touch the pressurized liquid. High pressurized molding provides uniform density,
which leads to a reduction of internal stresses, eliminating cracks, strains and
laminations, the ability to make complex shapes, and to press more than one
shape at the same time (The Technical Association of Refractories, Japan, 1998).

2.1.1.3 Kilns

Refractories are fired to develop the materials’ refractory properties. The unfired
(“green”) refractories pass through a heat treatment, which results in a thermally stable
refractory and or crystallization. The industry uses three types of kilns:

& Tunnel Kiln: In a tunnel kiln, refractory products consecutively pass through
preheating, firing, and cooling zones (see Figure 2-7). The combustion gas from
the firing zone is typically used to preheat the refractories. Heat can be recovered
from cooling fired refractories and reused as combustion air. Approximately 80
percent of shaped refractories are fired in tunnel kilns (The Technical Association
of Refractories, Japan, 1998).

Indirect Flame System Top Combustion System Side Combustion System

Figure 2-7. Tunnel Kiln

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& Round Periodic Kilns: Round periodic kilns are typically used to fire silica
bricks. Figure 2-8 is a diagram of a round periodic kiln. These kilns can be used
to fire large refractory products that cannot be fired in a tunnel kiln and can easily
accommodate changes in production (The Technical Association of Refractories,
Japan, 1998).

& Shuttle Kilns: As illustrated in Figure 2-9, the design of a shuttle kiln resembles
the firing zone of a tunnel kiln. Shuttle kilns effectively store heat and are used to
fire fireclay and specialty bricks (The Technical Association of Refractories,
Japan, 1998).

Figure 2-8. Round Kiln with Downdraft Figure 2-9. Shuttle Kiln
System

2.1.2 Final Commodities

Refractories are manufactured in two forms—shaped objects and unshaped, and

unshaped refractories come in granulated or plastic compositions. Briefly described here,
shaped and unshaped refractories are the two broad categories of refractories. Section 2.2
contains more information on the types of refractory products.

2.1.2.1 Shaped Refractories

Preshaped refractories include bricks, shapes, crucibles, and monolithics. Shaped

refractories are pre-fired to exhibit their ceramic characteristics. Table 2-1 lists each type of
shaped refractory and a description of its use.

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Table 2-1. Types and Descriptions of Refractories Produced

Kind Definition
Shaped Refractories
Bricks Refractories that have shapes and are used to line furnaces, kilns, glass tanks,
incinerators, etc.

Insulating firebrick Low thermal conductivity firebrick.

Unshaped Refractories
(Monolithic)
Mortar Materials for bonding bricks in a lining. The three types of mortar—heat-setting,
air-setting, and hydraulic-setting—have different setting mechanisms.
Castables Refractories for which raw materials and hydraulic-setting cement are mixed. They
are formed by casting and used to line furnaces, kilns, etc.
Plastics Refractories in which raw materials and plastic materials are mixed with water.
Plastic refractories are roughly formed, sometimes with chemical additives.

Gunning mixes Refractories that are sprayed on the surface by a gun.

Ramming mixes Granular refractories that are strengthened by gunning formulation of a ceramic
bond after heating. Ramming mixes have less plasticity and are installed by an air
rammer.

Slinger mixes Refractories installed by a slinger machine.

Patching materials/ Refractories with properties similar to refractory mortar. However, patching
coating materials materials have controlled grain size for easy patching or coating.

Lightweight castables Refractories in which porous lightweight materials and hydraulic cement are mixed.
They are mixed with water and formed by casting. Lightweight castables are used
to line furnaces, kilns, etc.
Fibrous Materials
Ceramic fiber Man-made fibous refractory materials. There are several different types of ceramic
fiber, including blanket, felt, module, vacuum form, rope, loose fiber, etc.

Source: The Technical Association of Refractories, Japan. 1998. Refractories Handbook. Tokyo: The
Technical Association of Refractories, Japan.

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2.1.2.2 Unshaped Refractories

The unshaped products include mortars, gunning mixes, castables (refractory

concrete), ramming mixes, and plastics. The manufacture of unshaped refractories differs
slightly from shaped refractories. Unshaped refractories typically do not go through a firing
process until they reach the final consumer. These unshaped refractories can be installed by
spraying, casting, molding, or ramming. Table 2-1 lists each type of refractory and a
description of its use.

2.1.3 Emissions and Controls in Refractory Manufacturing

Refractory production leads to emissions of organic particulate matter (PM); metals;

and gaseous pollutants, including sulfur dioxide (SO2), nitrogen oxides (NOx), carbon
monoxide (CO), carbon dioxide (CO2), fluorides, and volatile organic compounds (VOCs)
(EPA, 1994). Emission points are indicated by type of emission in Figure 2-1a.

2.1.3.1 PM and Metals Emissions

PM and metal emissions occur during the crushing, grinding, calcining, and drying of
the raw materials; the drying and firing of unfired refractory bricks and tar and pitch
operations; and finishing of the refractories. Emissions from crushing and grinding are
readily controlled with fabric filters. Product recovery cyclones and wet scrubbers are used
on calciners and dryers to reduce PM emissions. Electric arc furnaces are generally
controlled by a baghouse.

2.1.3.2 Gaseous and VOC Emissions

As previously mentioned, SO2, NOx, CO, CO2 are produced along with refractory
products. The source of most of the SO2 emissions is the fuel used to fire the kiln and dryers.
The composition of the clays and plaster added to refractories and the amount of refractories
produced affect the amount of SO2 produced. VOCs emitted from tar and pitch operations
are controlled by incineration.

2.1.4 Inputs

The inputs in the production process for refractories include general inputs, such as
labor, capital, and water. The inputs specific to this industry are the type of fuel and the clay
or other alumina and nonclay material used. These two specific inputs are discussed below.

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Table 2-2. Types and Characteristics of Raw Materials used in Refractory

Manufacture Type

Type Characteristics
Clay Refractories
Fireclay Consists of kaolinite (Al2O32SiO22H2O) and minor amount of other clay
materials. Fireclay refractories can be low, medium, high, or super-duty based
on their resistance to high temperature or refractoriness. Fireclay refractories are
used to produce bricks, insulating refractories, and two types of ladle brick.
High-alumina Composed of bauxite or other raw materials that contain 50 to 87.5 percent
alumina. High-alumina refractories are generally multipurpose, offering
resistance to chipping and higher volume stability. High-alumina refractories are
used to produce brick and insulating refractories.
Nonclay Refractories
Basic Produced from a composition of dead-burned magnesite, dolomite, chrome ore,
and small amount of other minerals. Basic refractories can be further subdivided
into magnesia, dolomite, chrome, and combination bricks. Basic refractories are
typically used to make bricks.
Extra-high alumina Made predominately from bauxite or alumina (Al2O3), extra-high alumina
refractories contain from 87.5 to 100 percent alumina and offer good volume
stability. They are typically poured into special shapes using a fused casting
process.
Mullite Made from kyanite, sillimanite, andalusite, bauxite, or mixtures of alumina
silicate materials; mullite refractories are about 70% alumina. They maintain a
low level of impurities and high resistance to loading in high temperatures.
Silica Containing silica, silica refractories are characterized by a high coefficient of
thermal expansion between room temperature and 500°C (930°F). Silica brick is
available in three grades: super-duty (low alumina and alkali), regular, and coke
oven quality. Silica compositions can be used for hot patching, shrouds, and
bricks.
Silicon carbide Produced by the reaction of sand and coke in an electric furnace, silicon carbide
refractories are used to make special shapes, such as kiln furniture, to support
ceramicware as it is fired in kilns. It has high thermal conductivity, good load
bearing characteristics at high temperatures, and good resistance to changes in
temperatures.
Zircon Containing siconium silicate (ZrO2SiO2), zircon refractories maintain good
volume stability for extended periods or exposure to high temperatures. Zircon
refractories are widely used for glass tank construction.

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2.1.4.1 Clays

Clay is composed mainly of fine particles of hydrous aluminum silicates and other
minerals that is plastic when moist but hard when fired. In 1998, approximately 3.09 Mt of
clays were used in the manufacture of refractories. Table 2-2 lists different clays used in
refractory products and their characteristics. Fireclay is the predominate clay used
infirebrick; bentonite, in foundry sand; common clay, in refractory mortar and cement; and
kaolin, in calcine, grog, high alumina brick, kiln furniture, and plug, tap, and wad (Virta,
1998).

2.1.4.2 Nonclays

Nonclay refractories are composed for alumina, mullite, chromite, magnesite, silica,
silicon carbide, zircon, and other nonclays. Table 2-2 lists various minerals used in the
production of nonclay refractories, the type of refractory produced, and characteristics of the
refractory.

2.2 Types of Products

Table 2-1 lists the different forms of refractories and describes them briefly.
Refractories are generally categorized as either clay or nonclay products. To further classify
the products, refractories are labeled as acidic or basic. Refractories are typically produced
as shaped refractories, unshaped refractories, and fibrous materials. Shaped refractories
include bricks, shapes, and crucibles. Bricks and shapes are formed by mixing raw materials
with water and/or other binders and pressing or molding the mixture into a desired shape.1
Crucibles are ceramic containers used for melting metal. Unshaped refractories, also called
monolithic, are unformed products that are dried to form a unified structure after application.
These refractories can be used as mortars, plastics, ramming mixes, castables, and gunning
mixes. Monolithic refractories are applied by either pouring, pumping, troweling, or
gunning (spraying).

1
Bricks and shapes can be formed by a variety of methods, including hand molding, air ramming, pressing,
extruding, or casting.

2-12
 DRAFT

2.3 Costs of Production

The costs incurred by refractory manufacturers are labor, materials, and capital. This
section provides data on these costs and discusses economies of scale.

2.3.1 Cost Data

Between 1994 and 1998, clay refractory manufactures spent an average of more than
70 percent and nonclay refractory producers almost 64 percent of expenditures on input
materials. Figure 2-10 illustrates the percentage breakdown of refractory manufacturing
expenditures by refractory type. Tables 2-3 and 2-4 also provide expenditures in dollars for
wages, materials, and new capital from 1977 to 1998 in both current and 1997 dollars. Costs
of materials include all raw materials, containers, scrap, and supplies used in production,
repair, or maintenance during the year, as well as the cost of all electricity and fuel
consumed. Costs are included for materials whether they are purchased from outside the
company or transferred from within the company. New capital expenditures include
permanent additions and alterations to facilities and machinery and equipment used for
expanding plant capacity or replacing existing machinery.

These tables show that the cost of materials is by far the greatest cost to refractory
producers. Refractory producers spend as much as two and a half times more on materials
than they do on labor. For 1998, the Annual Survey of Manufacturers reported that the clay
refractory industry spent $31.6 million and the nonclay refractory industry spent $52.7
million on energy, almost 6 and 8 percent, respectively, of the total materials cost for that
year. Energy costs for manufacturers of refractory bricks and shapes are generally greater
than energy costs for manufacturers of monolithic refractories because of the energy-
intensive nature of operations that require using forming equipment, dryers, and kilns.
Table 2-5 contains a more detailed breakdown of the costs of materials used in producing
and manufacturing refractory materials.

2-13
 DRAFT

Average Percentage
(1994-1998)

New Capital New Capital

3% 6%
Wages Wages
27% 30%

Materials Materials
70% 64%

(a) Clay Refractory (b) Nonclay Refractory

Manufacturers Expenditures Manufacturers Expenditures

Figure 2-10. Clay and Nonclay Refractory Manufacturers Expenditures

2-14
 DRAFT

Table 2-3. Labor, Material, and New Capital Expenditures for Clay Refractory
Manufacturers (NAICS 327124)a ($106)
Wages Materials New Capital
Year Current 1997$ Current 1997 Current 1997
1977 146.8 224.30 296.8 453.48 20.0 30.56
1978 171.8 254.08 364.6 539.21 23.1 34.16
1979 191.5 273.16 384.7 548.74 29.4 41.94
1980 183.6 253.02 363.1 500.39 31.5 43.41
1981 199.6 266.09 410.6 547.37 36.1 48.12
1982 155.2 204.68 339.0 447.07 21.2 27.96
1983 147.1 191.19 358.5 465.94 12.0 15.60
1984 176.6 226.17 438.2 561.20 22.0 28.18
1985 166.8 211.69 397.5 504.47 22.1 28.05
1986 160.4 202.68 412.6 521.36 15.8 19.96
1987 150.2 188.05 387.5 485.15 11.7 14.65
1988 160.0 193.46 401.7 485.70 14.0 16.93
1989 176.7 207.39 451.3 529.69 11.9 13.97
1990 168.8 196.28 475.3 552.68 15.2 17.67
1991 166.0 191.22 464.8 535.40 18.5 21.31
1992 183.8 196.57 452.8 484.27 24.6 26.31
1993 163.9 180.42 377.0 415.00 7.2 7.93
1994 179.0 191.44 494.0 528.33 16.5 17.65
1995 199.0 205.37 510.3 526.63 16.6 17.13
1996 196.4 200.88 510.7 522.34 18.6 19.02
1997 210.0 210.42 566.0 567.13 30.1 30.16
1998 201.8 201.80 536.5 536.50 25.6 25.60

a
Prices were deflated using the producer price index (PPI) from the Bureau of Labor Statistics. 2001.
<http://146.142.4.24/cgi-bin/surveymost>.

Sources: U.S. Department of Commerce, Bureau of the Census. 1994b. 1992 Census of Manufactures, Industry
Series—Cement and Structural Clay Products. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1995. 1993 Annual Survey of Manufactures.
M93(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1996a. 1994 Annual Survey of Manufactures.
M94(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1997. 1995 Annual Survey of Manufactures.
M95(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1998. 1996 Annual Survey of Manufactures.
M96(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1999b. 1997 Census of Manufactures, Industry
Series—Manufacturing: Clay Refractory Manufacturing. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 2000. 1998 Annual Survey of Manufactures.
M98(AS)-1. Washington, DC: Government Printing Office.

2-15
 DRAFT

Table 2-4. Labor, Material, and New Capital Expenditures for Nonclay Refractory
Manufacturers (NAICS 327125)a ($106)
Wages Materials New Capital
Year Current 1997 Current 1997 Current 1997
1977 134.3 205.20 336.4 513.99 37.1 56.69
1978 162.7 240.62 434.9 643.17 43.1 63.74
1979 172.5 246.05 434.6 619.91 24.4 34.80
1980 177.4 244.47 482.3 664.66 47.2 65.05
1981 196.5 261.95 484.7 646.15 69.7 92.92
1982 148.4 195.71 343.3 452.74 48.5 63.96
1983 129.5 168.31 312.8 406.55 20.8 27.03
1984 147.5 188.90 347.1 444.53 24.7 31.63
1985 152.0 192.90 369.2 468.55 32.5 41.25
1986 162.7 205.59 372.1 470.19 13.7 17.31
1987 202.5 253.53 443.5 555.26 16.3 20.41
1988 209.6 253.43 470.7 569.12 18.0 21.76
1989 232.6 273.00 480.4 563.85 36.3 42.61
1990 239.9 278.96 499.0 580.24 30.3 35.23
1991 241.3 277.95 500.6 576.64 26.5 30.53
1992 249.2 266.52 541.4 579.03 44.9 48.02
1993 279.3 307.45 578.8 637.14 62.5 68.80
1994 247.6 264.81 562.5 601.59 41.1 43.96
1995 274.9 283.70 588.3 607.13 35.9 37.05
1996 278.6 284.95 574.0 587.09 42.7 43.67
1997 288.4 288.98 621.3 622.54 88.8 88.98
1998 307.1 307.10 650.9 650.90 96.8 96.80

a
Prices were deflated using the producer price index (PPI) from the Bureau of Labor Statistics. 2001.
<http://146.142.4.24/cgi-bin/surveymost>.

Sources: U.S. Department of Commerce, Bureau of the Census. 1994a. 1992 Census of Manufactures, Industry
Series—Abrasive, Asbestos, and Miscellaneous Mineral Products. Washington, DC: Government Printing
Office.
U.S. Department of Commerce, Bureau of the Census. 1995. 1993 Annual Survey of Manufactures.
M93(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1996a. 1994 Annual Survey of Manufactures.
M94(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1997. 1995 Annual Survey of Manufactures.
M95(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1998. 1996 Annual Survey of Manufactures.
M96(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1999c. 1997 Census of Manufactures, Industry
Series—Manufacturing: Nonclay Refractory Manufacturing. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 2000. 1998 Annual Survey of Manufactures.

2-16
 DRAFT

Table 2-5. Costs of Materials Used in Refractory Production and Manufacturea

1997 1992
Delivered Cost Percentage of Delivered Cost Percentage of
Material ($106) Material Costs ($106) Material Costs
Clay NAICS 327124
Materials, ingredients, containers, 35.2 6.22 26.7 6.55
and supplies
Clay, ceramic, and refractory 284 50.18 209 51.26
minerals
Dead-burned magnesia or 6.9 1.22 8.4 2.05
magnesite
Refractories, clay or nonclay 90.8 16.04 79.6 19.52
Other stone, clay, glass, and 4.4 0.78 5.2 1.28
concrete products
Industrial chemicals 6.5 1.15 2.2 0.53
All other materials and 65.1 11.50 76.8 18.83
components, parts, containers,
and supplies
Nonclay NAICS 327125
Materials, ingredients, containers, 50.4 8.11 65.4 11.12
and supplies
Clay, ceramic, and refractory 224.2 36.09 156.2 26.58
minerals
Dead-burned magnesia or 38.7 6.23 59.1 10.05
magnesite
Refractories, clay or nonclay NA NA 65.6 11.16
Other stone, clay, glass, and NA NA NA NA
concrete products
Industrial chemicals 21.4 3.44 21.1 3.58
All other materials and 73.9 11.89 75.3 12.82
components, parts, containers,
and supplies

NA = Not available.
a
Prices were deflated using the producer price index (PPI) from the Bureau of Labor Statistics. 2001.
<http://146.142.4.24/cgi-bin/srgate>.

Source: U.S. Department of Commerce, Bureau of the Census. 1999b. 1997 Census of Manufactures, Industry
Series—Manufacturing: Clay Refractory Manufacturing. Washington, DC: Government Printing
Office.

2-17
 DRAFT

SECTION 3

THE DEMAND SIDE

Estimating the economic impacts of the regulation on the refractory manufacturing

industry requires characterizing various aspects of the demand for refractory products. This
section describes the product characteristics decided by end users; the uses for refractories,
including use in the glass, metal, and electronics industries; and possible substitutes for
refractories.

3.1 Product Characteristics

Because the quality and characteristics of refractories vary considerably, consumers

often employ chemical and physical tests to ensure that the refractories purchased meet their
requirements. The American Society for Testing and Materials (ASTM) provides
specifications and tests for various kinds and uses of refractory products. Depending on the
intended end use, consumers may test refractories for thermal conductivity, resistance to
abrasion and corrosion, permeability, oxidation resistance, and other characteristics (ASM
International, 1987).

Most refractory products are sold as preformed shapes. However, they are also
available in special purpose clays; bonding mortars; and monolithic, plastic refractories;
ramming mixes; and gunning mixes. A variety of processed refractory grains and powders
are also produced (DHAN, 1999). From the physical form, refractory products can be
further classified into oxide bricks, nonoxide bricks, and composites. Table 3-1 lists types of
oxide, nonoxide, and composite refractories; their characteristics; and their applications.

3.2 Uses and Consumers

Principle end-use markets for refractory products include iron and steel, cement, and
nonferrous metal industries. The steel industry consumes the largest percentage of
refractories, estimated between 50 and 80 percent of the refractory production (Semler,

3-1
 DRAFT

Table 3-1. Characteristics and Types of Refractories

Refractory Type General Characteristics Application

Oxide Bricks
Silica High strength at high temperatures, residual Glass tank crown, copper refining
expansion, low specific gravity, high expansion furnace, electric arc furnace roof
coefficient at low temperatures, low expansion
coefficient at high temperatures
Fused silica Low thermal expansion coefficient, high thermal Coke oven, hot stove, soaking pit, glass
shock resistance, low thermal conductivity, low tank crown
specific gravity, low specific heat
Chamotte Low thermal expansion coefficient, low thermal Ladle, runner, sleeve, coke oven,
(fireclay) conductivity, low specific gravity, low specific heat, annealing furnace, blast furnace hot
low strength at high temperatures, less slag penetration stove, reheating furnace, soaking pit
Alumina High refractoriness, high mechanical strength, high Hot stove, stopper head, sleeve, soaking
slag resistance, high specific gravity, relatively high pit cover, reheating furnace, glass tank,
thermal conductivity high-temperature kiln
High alumina High refractoriness, high mechanical strength, high Slide gate, aluminum melting furnace,
slag resistance, high specific gravity, relatively high skid rail, ladle, incinerator, reheating
thermal conductivity furnace hearth, skid rail, ladle,
incinerator
Roseki Low thermal expansion coefficient, high thermal Ladle, runner, sleeve, coke oven,
shock resistance, low thermal conductivity, low annealing furnace, blast furnace hot
specific gravity, low specific heat stove, reheating furnace, soaking pit
Zircon High thermal shock resistance, high slag resistance, Ladle, nozzle, stopper head, sleeve
high specific gravity
Zirconia High melting point, low wettability against molten Nozzle for continuous casting, glass
metal, low thermal conductivity, high corrosion tank, high-temperature furnace, crucible
resistance, high specific gravity
Alumina zirconia High slag resistance, high corrosion resistance against Glass tank, incinerator, ladle, nozzle for
silica molten glass continuous casting
Lime High slag resistance, low hydration resistance Special refining surface
Magnesia High refractoriness, relatively low strength at high Hot-metal mixer, secondary refining
temperature, high basic slag resistance, low thermal vessel, rotary kiln, checker chamber of
shock resistance, low durability at high humidity glass tank, electric arc furnace
Magnesia- High refractoriness, high refractoriness under load, Hot-metal mixer, electric arc furnace,
chrome high basic slag resistance, relatively good thermal secondary refining vessel, nonferrous
shock resistance (low MgO bricks), high strength at refining furnace, rotary cement kiln, lime
high temperature (direct bonded and fusion cast) and dolomite kiln, copper furnace, ladle,
checker chamber for glass tank, slag line
of electric arc furnace, degasser for
copper, nonferrous smelter

(continued)

3-2
 DRAFT

Table 3-1. Characteristics and Types of Refractories (continued)

Refractory Type General Characteristics Application

Oxide Bricks (continued)
Chrome High refractoriness, low strength at high temperature, Buffer brick between acid and basic
low thermal resistance brick
Dolomite High refractoriness, high refractoriness under load, Basic oxygen furnace, electric arc
high basic slag resistance, low durability in high furnace, secondary refining vessel, rotary
humidity, high thermal expansion coefficient cement kiln
Spinel High thermal shock resistance, high strength at high Rotary cement kiln, ladle
temperatures, high slag resistance
Nonoxide Bricks
Carbon High refractoriness, high slag resistance, low oxidation Blast furnace hearth, electric arc furnace
resistance
Silicon carbide High refractoriness, high strength at high temperature, Kiln furniture, incinerator, blast furnace
high thermal conductivity, high thermal shock
resistance, reduced oxidation resistance at high
temperature, high slag resistance
Silicon carbide- High refractoriness, high strength at high temperature, Incinerator
graphite high thermal conductivity, high thermal shock
resistance
Silicon nitride High strength, high thermal shock resistance, Kiln furniture, blast furnace
relatively high oxidation resistance
Composite
Silicon carbide High corrosion resistance against low iron oxide, high Ladle, blast furnace, electric arc, torpedo
Containing strength at high temperatures, high thermal shock ladle, iron ladle
resistance
Magnesia-carbon High slag resistance, high thermal shock resistance Basic oxygen furnace, electric arc
furnace, ladle
Alumina-carbon High refractoriness, high thermal shock resistance, Submerged entry nozzle, slide gate
high corrosion resistance

Source: The Technical Association of Refractories, Japan. 1998. Refractories Handbook. Tokyo: The Technical
Association of Refractories, Japan.

2000).1 Table 3-2 presents metric ton production of raw steel and nonferrous metals for the
period 1994 to 1999. Refractory products are used in the steel industry to line coke ovens,

1
The U.S. International Trade Commission (USITC) estimated consumption of the steel industry at over 50
percent, and DHAN estimated it at 75 percent.

3-3
 DRAFT

Table 3-2. Steel and Nonferrous Production (103 Metric Tons)

Year Raw Steel Production Nonferrous

1994 91,300 11,216
1995 95,200 13,606
1996 94,700 11,608
1997 98,500 14,501
1998 98,700 14,811
1999 95,300 15,215

Source: U.S. Department of Commerce, and International Trade Administration. 1999. U.S. Industry & Trade
Outlook 2000. New York: The McGraw-Hill Companies and U.S. Department of Commerce.

blast furnaces, blast furnace stoves, basic oxygen vessels, electric furnaces, open-hearth
furnaces, and other heat-related manufacturing equipment (ASM International, 1987).

Because of improved quality of refractory products, the steel industry has decreased
consumption of refractories from 25 to 30 kg per ton of steel to 10 kg in Japan and the
United States (Semler, 2000). This is the result of increased life-span of refractory products.
Other consumers of refractory products, including the petroleum industry and concrete
industry are following the steel industry’s pattern of reducing consumption of refractories.

3.3 Substitution Possibilities in Consumption

Although there is no direct substitute for refractories, industries that use refractory
products have reduced the amount of the product consumed. Since the 1980s, the steel
industry has restructured closing inefficient facilities and modernizing remaining plants. The
industry developed and implemented technologies, such as the basic oxygen furnace (BOF),
that significantly reduced the amount of refractories used per ton of steel (USITC, 1994;
DHAN, 1999). Also, the refractory industry has made significant strides in developing more
durable refractories. These two factors have reduced the overall consumption of refractory
materials.

3-4
 DRAFT

SECTION 4

INDUSTRY ORGANIZATION

This section examines the organization of the U.S. refractory industry, including
plant location and production characteristics, commercial and captive producers, firm
characteristics, market structure, and degree of integration. Understanding the industry’s
organization helps determine how it will be affected by complying with the refractory
production NESHAP.

4.1 Refractory Manufacturing Plants

A facility is a site of land with a plant and equipment that combine inputs (clay, fuel
and labor) to produce an output (refratory products). Companies that own these facilities are
legal business entities that conduct transactions and make decisions that affect the facility.
The terms “facility,” “establishment,” and “plant” are synonymous in this study and refer to
the physical location where products are manufactured. Likewise, the terms “company” and
“firm” are used interghangeably to refer to the legal business entity that owns one or more
facilities. This section presents information on the companies that own refractory plants.

4.1.1 Refractories Database Facilities

Table 4-1 presents detailed information on refractory companies, including the

location of the facility, its estimated sales volume in millions of dollars, and its employment.

4.1.2 Facility Location

Approximately 280 refractory manufacturing plants operate in the United States.

Refractory materials are produced in 37 states. Table 4-2 lists the number of refractory
facilities in the 50 states and Puerto Rico. The leading refractory-producing states are
Pennsylvania and Ohio. Figure 4-1 illustrates the distribution of the refractory producing
facilities in the United States.

4-1
 Table 4-1. Selected Refractory Manufacturers, by Type

Sales Company Sales

Company Location ($106) Employment Type Owning Company ($106) Employment
Clay
Able Supply Co. Houston, TX NA NA NA NA NA NA
Alsey Refractories Co. Alsey, IL 10 to 20 20 to 49 Private
B&B Refractories, Inc. Santa Fe Springs, CA 2.5 10 to 19 Private
to 5
Bay State Crucible Co. Tauton, MA 5 to 10 20 to 49 Private

Bloom Engineering Co., Pittsburgh, PA 38 187 Subsidiary Sterling Industries PLC, NA NA

Inc. England
BNZ Materials, Inc. Littleton, CO 25 150 Private
Carpenter EPG Certech, Wilkes Barre, PA 14 150 Subsidiary Carpenter Technology Corp. 1,000 5,324
Inc.
Carpenter Technology Reading, PA 1,000 5,324 Public
Corp.

4-2
Ceradyne, Inc. Costa Mesa, CA 26 300 Private
Certech, Inc. Wood Ridge, NJ 62 758 Subsidiary Carpenter Technology Corp. 1,000 5,324
CFB Industries, Inc. Chicago, IL 23 176 Private
Christy Refractories Co. St. Louis, MO 14 80 Private
LLC
Clay City Pipe Uhrichsville, OH 14 200 Private
Cooperheat-MQS, Inc. Houston, TX 120 1,200 Private
ER Advanced Ceramics, East Palestine, OH NA NA NA NA NA NA
Inc.
Ermhart Glass Owensville, NJ NA NA NA NA NA NA
Manufacturing, Inc.
Fels Refractories, Inc. Edison, NJ 1 to 2.5 NA Private
Ferro Corp. Cleveland, OH 331 6,693 Public
Freeport Area Enterprises, Freeport, PA 10 150 Private
Inc.
Freeport Brick Co. Creighton, PA NA NA NA NA NA NA

(continued)
DRAFT
 Table 4-1. Selected Refractory Manufacturers, by Type (continued)

Sales Company Sales

Company Location ($106) Employment Type Owning Company ($106) Employment
Clay (continued)
Global Industrial Dallas, TX 142 4,262 Public
Technologies, Inc.
Green AP Refractories, Inc. Mexico, MO 25 300 Subsidiary RHI AG 1,580 14,500
Harbison-Walker Pittsburgh, PA 263 1,615 Subsidiary RHI AG 1,580 14,500
Refractories Co.
Heater Specialists, Inc. Tulsa, OK 17 160 Private
Holland Manufacturing Dolton, IL 2.5 20 to 49 NA NA NA NA
Corp. to 5
Howmet Corp. Whitehall, MI 1,300 10,350 Subsidiary Cordant Technologies, Inc. 2,513 17,200
Industrial Ceramic Columbus, OH NA NA NA NA NA NA
Products, Inc.
Industrial Product Englewood, CO 1 to 2.5 5 to 9 Private

4-3
International
Inland Enterprise, Inc. Avon, OH 14 100 Private
Insul Co., Inc. East Palestine, OH 15 77 Private
International Chimney Williamsville, NY 18 140 Private
Corp.
Lousiville Firebrick Works Grahm, KY NA NA NA NA NA NA
Martin Marietta Magnesia Raleigh, NC Subsidiary Martin Marietta Materials, 1,057 570
Specialties, Inc. Inc.
Maryland Refractories Co. Irondale, OH 1 to 2.5 NA Private
Mono Ceramics, Inc. Benton Harbor, MI 11 45 Subsidiary Monocon International NA NA
Refractories, England
Morganite Crucible, Inc. North Haven, CT 15 75 Subsidiary Morgan Crucible Co. PLC, 1,394 16,885
England
Mt. Savage Firebrick Co. Frostburg, MD NA NA NA NA NA NA
National Refractories & Livermore, CA 115 600 Subsidiary National Refractory Holding NA 810
Minerals Corp. Co., Inc.
New Castle Refractories Massillon, OH 14 122 Subsidiary Dixon Ticonderoga 115 1,354
DRAFT
 Table 4-1. Selected Refractory Manufacturers, by Type (continued)

Sales Company Sales

Company Location ($106) Employment Type Owning Company ($106) Employment
Clay (continued)
North America Refractories Cleveland, OH 331 1,500 Subsidiary Didier-Werke AG, Germany 448.5 NA
Co.
P-G Industries, Inc. Pueblo, CO 12 160 Private
Plibrico Co. Oak Hill, OH 10 to 20 20 to 40 Private
Porvair Corp. Hendersonville, NC 18 200 Private
Premier Refractories, Inc. King of Prussia, PA 64 778 Private
Premier Refractories King of Prussia, PA 90 900 Subsidiary Alpine Group, Inc. 1,370 6,600
International, Inc.
Pryotech, Inc. Spokane, WA 45 650 Private
Refco, Inc. Boylston, MA 34 88 Subsidiary Industrial Distribution 273 1,200
Group, Inc.
Refractories Sales and Bessemer, AL NA NA NA NA NA NA
Service Co., Inc.

4-4
Reno Refractories, Inc. Morris, AL 16 85 Private
Resco Products, Inc. Norristown, PA 50 500 Private
RHI Refractories America NA NA NA NA NA NA

Riverside Clay Co., Inc. Pell City, AL 15 100

Riverside Refractories, Inc. Pell City, AL 14 100 Subsidiary Riverside Clay Co., Inc. 15 100
Rutland Products Jacksonville, FL NA NA NA NA NA NA
Servsteel, Inc. Morgan, PA
SGL Carbon Corp. Charlotte, NC 255 1,891 Subsidiary SGL Aktiengesellschaft,
Germany
Shenango Refractories, Inc. New Castle, PA 5 to 10 20 to 49 Private
Sterling Industries of Pittsburgh, PA 57 312 Subsidiary Sterling Industries PLC,
Delaware, Inc. England
The Nock and Son Co. Oak Hill, OH 2.5 10 to 19 Private
to 5

(continued)
DRAFT
 Table 4-1. Selected Refractory Manufacturers, by Type (continued)

Company Sales Employment

Company Location Sales ($106) Employment Type Owning Company ($106)
Clay (continued)
The Whitacre-Greer Fire Alliance, OH 5 to 10 NA Private
Proofing Co.
Thermal Ceramics, Inc. Augusta, GA 138 1,200 Subsidiary Morgan Crucible Co. PLC, 1,394 16,885
England
Thorley Refractories, Inc. Southgate, CA 5 to 10 20 to 49 Private

Transit Mix Concrete Co., Colorado Springs, 25 210 Subsidiary Contenental Materials Corp., NA NA
Inc. CO Delaware
TYK America, Inc. Clairton, PA 37 122 Subsidiary TYK Corp., Japan 133.5 NA
Unifrax Corp. Niagara Falls, NY 85 285 Subsidiary Kirkland Capital Partners LP 90 808
Universal Refractories, Inc. Wampum, PA 24 130 Private
Utah Refractories Co. Lehi, UT NA NA NA NA NA NA

4-5
Wahl Refractories, Inc. Fremont, OH 17 68 Subsidiary Thermatex Corp. 10 148
Zero Refractories, Inc. Taylor MI 0.5 1 to 4 Private
Nonclay
Advanced Ceramics Corp. Cleveland, OH 25 to 50 NA Private
Advanced Ceramics Cleveland, OH 21 175 Private
International, Inc.
Allied Mineral Products, Columbus, OH 56 240 Private
Inc.
Alpine Group, Inc. New York, NY 1,370 6,600 Public
Aluminum Company of Pittsburgh, PA 15,300 103,500 Public
America (ALCOA)
AMPAC Amsterdam, NY 13 100 Private
B S C Holding, Inc. Shawnee Mission, 23 15 Private
KS
Baker Holding Co., Inc. York, PA 190 1,300 Public
Baker JE Co. York, PA 190 1,050 Subsidiary Baker Holding Co., Inc. 190 1,300
Bartley Crucible & Trenton, NJ NA NA NA NA NA NA
DRAFT
 Table 4-1. Selected Refractory Manufacturers, by Type (continued)

Sales Company Sales

Company Location ($106) Employment Type Owning Company ($106) Employment
Nonclay (continued)
Bethlehem Advanced Knoxville, TN 14 110 Subsidiary The Bethlehem Corp. 14 117
Materials Corp.
Blash Precision Ceramics, Houston, TX 63 515 Private
Inc. (Texas United)
BNZ Materials, Inc. Zelienople, PA 1 to 2.5 5 to 9 private
CCPI, Inc. Blanchester, OH 25 to 50 NA private
Cercom, Inc. Vista, CA 11 76 Private
Certech, Inc. Streetsboro, OH 62 758 Subsidiary Carpenter Technology Corp. 1,000 5,324
CFB Industries, Inc. Chicago, IL 23 176 Private
Chicago Firebrick Co., Inc. Chicago, IL 18 58 Private
Coors Porcelain Co., Inc. 304 2,900 Subsidiary ACX Technologies, Inc. 988 5,600
Dixon Ticonderoga Co., Lake Mary, FL 85 1,562 Public
Inc.
ETS Schaefer Corp. Macedonia, OH 13 195 Subsidiary Alumitech, Inc. 21 210

4-6
Foseco, Inc. Cleveland, OH 71 500 Subsidiary Foseco Holding BV,
Netherlands
Global Industrial Dallas, TX 142 4,262 Public
Technologies, Inc.
Harbison-Walker Pittsburgh, PA 263 1,615 Subsidiary RHI AG 1,580 14,500
Refractories Co.
Insul Co., Inc. East Palestine, OH 15 77 Private
JW Hicks, Inc. Merrellville, IN 5 to 10 20 to 49 NA NA NA NA
Magneco, Inc. Addison, IL 19 150 Subsidiary Magneco/Metrel, Inc. 34
Martin Marietta Magnesia Raleigh, NC Subsidiary Martin Marietta Materials, 1,057 570
Specialties, Inc. Inc.
Minco Acquistion Corp. Midway, TN 21 170 Private
Minco, Inc. Midway, TN 15 135 Subsidiary Minco Acquisition Corp. 21 170
Minerals Technologies, New York, NY 609 2,260 Public
Inc.
Minteq International, Inc. New York, NY 205 1,800 Subsidiary Minerals Technologies, Inc. 609 2,260

(continued)
DRAFT
 Table 4-1. Selected Refractory Manufacturers, by Type (continued)

Sales Company Sales

Company Location ($106) Employment Type Owning Company ($106) Employment
Nonclay (continued)
Mitsubishi Cement Corp. Ontario, CA 74 619 Subsidiary Mitsubishi Materials Corp., 9,354 6,556
Japan
Mixed Mineral Products, Columbus, OH NA NA NA NA NA NA
Inc.
Monofrax, Inc. Falconer, NY 50 to 100 250 to 499 Private
Morganite Crucible, Inc. North Haven, CT 15 75 Subsidiary Morgan Crucible Co. PLC, 1,394 16,885
England
National Refractories & Livermore, CA 115 600 Subsidiary National Refractory Holding
Minerals Corp. Co., Inc.

New Castle Refractories Massillon, OH 14 122 Subsidiary Dixon Ticonderoga 115 1,354
Newport Sand & Gravel Newport, NH 13 100 Private

4-7
Co., Inc.
North American Cleveland, OH 331 1,500 Subsidiary Didier-Werke AG, Germany NA NA
Refractories Co.
Norton Co., Inc. Worcester, MA 1,500 9,000 Subsidiary Saint-Gobain, France 23,113 165,000
Osram Sylvania, Inc. Danvers, MA 5,200 13,000 Subsidiary Siemans Corp.
Osram Sylvania Products, Danvers, MA 1,800 1,100 Subsidiary Siemans Corp.
Inc.
Pell Industries Grove City, PA 5 to 10 20 to 49 Private
Prefromix Technologies Warren, OH 10 75 Private
LTD
Premier Refractories King of Prussia, PA 90 900 Subsidiary Alpine Group, Inc. 1,370 6,600
International, Inc.
Premier Services, Inc. Bettsville, OH NA NA NA NA NA NA

Pyrotek Inc. Spokane, WA 50 to 100 NA Private

Rex Roto Corp. Fowlerville, MI 14 80 Private
DRAFT
 Table 4-1. Selected Refractory Manufacturers, by Type (continued)

Sales Company Sales

Company Location ($106) Employment Type Owning Company ($106) Employment
Nonclay (continued)
Saint-Gobain Advanced Louisville, KY 533 3,300 Subsidiary Norton Co., Inc.
Materials Corp.
Selee Corp. Hendersonville, NC 5 190 Subsidiary Porvair PLC, England
Silicon Carbide Products, Elmira, NY 1 to 2.5 5 to 9 Private
Inc.
Spar, Inc. Jacksonville, FL NA NA NA NA NA NA
Thermatex Corp. Fremont, OH 10 148 Private
(Thermalite)
TYK America, Inc. Clairton, PA 37 122 Subsidiary TYK Corp., Japan 133.5 NA
UCAR Carbon Co. Danbury, CT 105 1,506 Subsidiary UCAR International, Inc. 947 4,952
Universal Refractories, Inc. Wampum, PA 24 130 Private
Varsal Instruments, Inc. Warminster, PA 15 224 Private
Vesuvius Crucible Co. Champaign, IL 400 2,500 Subsidiary Cookson Group PLC, 3,011 17,101
England

4-8
Vesuvius USA Corp. Champaign, IL 400 1,600 Subsidiary Cookson Group PLC, 3,011 17,101
England
Wulfrath Refractories, Inc. Tarentum, PA 22 115 Private
Zircar Products, Inc. Florida, NY 12 85 Private
Zircoa, Inc. Solon, OH 20 140 Subsidiary Didier-Werke AG, Germany 448.5 4,717

NA = Not available.

Source: Dun & Bradstreet. 2000. D&B Million Dollar Directory. Series 2000. Bethlehem, PA: Dun & Bradstreet, Inc.
DRAFT
 DRAFT

Table 4-2. Number of Refractory Manufacturing Facilities by State

Number of Refractory Plants

State Clay (NAICS 327124) Nonclay (NAICS 327125)
Alabama 8
California 10 6
Georgia 5 4
Illinois 7 7
Indiana 7
Kentucky 6
Maryland 4
Michigan 7
Missouri 9 3
New York 3
New Jersey 7
North Carolina 2
Ohio 27 24
Pennsylvania 30 22
Texas 7
West Virginia 3
Totals 107 101

Source: U.S. Department of Commerce, Bureau of the Census. 1999a. 1997 Census of Manufactures.
Washington, DC: Government Printing Office.

4.2 Capacity Utilization

Capacity utilization indicates how well the current facilities meet demand. One
measure of capacity utilization is capacity utilization rates. A capacity utilization rate is the
ratio of actual production volumes to full-capacity production volumes. For example, if an
industry is producing as much output as possible without adding new floor space for
equipment, the capacity utilization rate would be 100 percent. On the other hand, if under
the same constraints the industry were only producing 75 percent of its maximum possible
output, the capacity utilization rate would be 75 percent. On an industry-basis, capacity
utilization is highly variable from year to year depending on economic conditions. It is also
variable on a company-by-company basis depending not only on economic conditions, but

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 DRAFT

2 1
3 27 0 1
1 10

0 0 0 0 0 0
2 6 0 1
0 1
1 3 0 3
7 15
1 16 0 10 0 0
5 33
0 1
0 0 0 5 6 12
1 1 0 0
0 29 3 12
1 0 3 2
0 0 0 3
1 4
1 13
28 59 0 0
1 3 0 1
11 32 0 0
0 0 0 2 3 2
37 58 4 4
2 2 1 1
8 25 3 39 0 12
1 2 8 38
4 15
2 7 4 20 0 1
5 2 3 9
1 4 1 1 3 5 0 5
7 17 3 3
2 0 11 5 1 9 3 5
12 26 3 11
4 3 5 8
1 14
3 6
3 11 0 10
0 2 1 2 2 15
2 14 0 0 3 9 1 8 1 9
1 6 1 13 3 13

7 10 3 5
0 3
5 23 2 20
1 12

8 21
11 49 1 2
1 29
0 0 0 8
1 6 6 9

0 0
1 2
Number of Number of
Refractory Facilities Steel Mills
1 2
Puerto Rico 3 4
1 0 Number of Number of
0 2 Cement Plants Nonferrous Plants

Figure 1

Figure 4-1. Location of Refractory Manufacturing Facilities

also on company’s strategic position in its particular industry. While some plants may have
idle production lines or empty floor space, others need additional space or capacity.

Table 4-3 lists the capacity utilization rates for clay and nonclay refractory
manufacturers refractories for 1993 though 1998. Reduction in the demand for refractory
replacements parts led to lower capacity utilization rates throughout this time period.
Nonclay refractories, which includes specialty refractory products, has seen increased
demand, allowing that part of the industry to maintain an approximately 70 percent capacity
utilization rate.

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 DRAFT

Table 4-3. Full Production Capacity Utilization Rates for Clay and Nonclay
Refractories: Fourth Quarters 1993 through 1998

Clay (NAICS 327125) Nonclay (NAICS 327125)

1993 75 71
1994 80 75
1995 63 81
1996 61 82
1997 49 78
1998 54 72

Source: U.S. Department of Commerce, Bureau of the Census. 1999d. 1998 Survey of Plant Capacity.
Washington, DC: Government Printing Office.

4.3 Industry Concentration and Market Structure

Market structure, which characterizes the level and type of competition among
refractory producers, determines the behavior of producers and consumers in the industry,
including their power to influence market price. If an industry is perfectly competitive, then
the individual producers have little market power; they are not able to influence the price of
the outputs they sell or the inputs they purchase. Perfectly competitive industries have large
numbers of firms, the products sold are undifferentiated, and the entry and exit of firms are
unrestricted.

Conversely, imperfectly competitive industries or markets are characterized by a

smaller number of firms, differentiated products, and restricted entry or exit. Product
differentiation can occur both from differences in product attributes and quality and from
brand name recognition of products. Entry and exit of firms are restricted in industries when
government regulates entry (e.g., through licenses or permits), when one firm owns the entire
stock of critical input, or when a single firm is able to supply the entire market.

When compared across industries, firms in industries with fewer firms, more product
differentiation, and restricted entry are more likely to have the power to influence the price
they receive for a product by reducing output below perfectly competitive levels. At the

4-11
 DRAFT

extreme, a single monopolistic firm may supply the entire market and hence set the price of
the output. On the input market side, firms may be able to influence the price they pay for an
input if few firms, both from within and outside the industry, use that input.

4.3.1 Measures of Industry Concentration

To assess the competitiveness of an industry, economists often estimate four-firm

concentration ratios (CR4), eight-firm concentration ratios (CR8), and Herfindahl-
Hirschmann indexes (HHI) for the subject market or industry. The CR4s and CR8s measure
the percentage of sales accounted for by the top four and eight firms in the industry. The
HHIs are the sums of the squared market shares of firms in the industry. Table 4-4 provides
concentration ratios for the refractory industry.

Table 4-4. Market Concentration Measures for SIC 3255 Clay Refractory
Manufacturing and SIC 3297 Nonclay Refractory Manufacturing

Value
Measure Clay Nonclay
Herfindahl-Hirschmann Index (HHI) 578 527
Four-firm concentration ratio (CR4) 40 36
Eight-firm concentration ratio (CR8) 62 58
Number of companies 95 102
Number of facilities 145 142
Value of shipments 886.8 1,203.8

Source: U.S. Department of Commerce, Bureau of the Census. 1996b. Concentration Ratios in
Manufacturing. MC92-S-2. Washington, DC: Government Printing Office. Available at
<http://www.census.gov/mcd/mancen/download/mc92cr.sum>.

Unfortunately, there is no objective criterion for determining market structure based

on the values of these concentration ratios. However, there are criteria for determining
market structure based on the HHIs for use in merger analyses, which are provided in the
1992 Department of Justice’s Horizontal Merger Guidelines (U.S. Department of Justice and
the Federal Trade Commission, 1992). According to these criteria, industries with HHIs
below 1,000 are considered unconcentrated (i.e., more competitive), those with HHIs
between 1,000 and 1,800 are considered moderately concentrated (i.e, moderately

4-12
 DRAFT

competitive). Firms in less-concentrated industries are more likely to be price takers, while
firms in more-concentrated industries are more likely to be able to influence market prices.
These measures of market concentration can be computed using four-digit SIC codes based
on U.S. Bureau of the Census data (U.S. Department of Commerce, 1993). Based on the
HHI criteria, the refractory industry is not concentrated, and, therefore, competitive in
structure. These indices are measures of concentration of the industry at the national level.
There is no reason to believe, however, that the markets for refractories may be regional
rather than national.

4.3.2 Market Structure

The refractories industry is characterized by having the majority of its products used
as inputs for the steel industry. Small numbers of buyers can result in the buyers maintaining
some measure of control over the input price (monopsony or oligopsony).

A monopsony occurs when a firm is the sole purchaser of an input. The monopsonist
has the market power in the input market and can reduce the price paid without losing all
input. An oligopsony is characterized by the presence of a few large buyers (even though
there may also be many small buyers of insignificant size). In oligopsony, large firms are
aware of their competitors for purchasing inputs and determine their purchasing price and
quantity based on their expectations of their competitors’ behavior. Because of multiple
steel manufacturers, refractory inputs are purchased by multiple buyers resulting in
oligopsonisonistic market.

4.3.3 Small Businesses that Own Lime Facilities

To determine the possible impacts on small businesses, both clay and nonclay
refractory manufacturers are categorized as small or large using the Small Business
Administration (SBA) general size definitions (SBA, 1998). For clay refractory
manufacturers, a small company has 500 or fewer employees. For nonclay refractory
manufacturers, small is defined as having 750 or fewer employees.

Table 4-5 lists the employment and sales data for the small companies that are
owners of refractory producing facilities. Data on employment and sales for many of these
companies is difficult to acquire, because they are privately held. Thirty-five companies
owning clay refractory plants and 26 nonclay refractory owning businesses are small, while 7

4-13
 DRAFT

Table 4-5. Characteristics of Small Businesses in the Refractory Industry

Sales Organization
Company Location ($106) Employment Type
Able Supply Co. Houston, TX NA NA NA
Alsey Refractories Co. Alsey, IL 10 to 20 20 to 49 Private
B&B Refractories Inc. Santa Fe Springs, CA 2.5 to 5 10 to 19 NA
Bay State Crucible Co. Taunton, MA 5 to 10 20 to 49 NA
Ceradyne Inc. Costa Mesa, CA 26 300 Private
Christy Refractories Co. LLC St. Louis, MO 14 80 Private
Clay City Pipe Uhrichsville, OH 14 200 Private
ER Advanced Ceramics Inc. East Palestine, OH NA NA NA
Ermhart Glass Manufacturing Owensville, NJ NA NA NA
Inc.
Fels Refractories Inc. Edison, NJ 1 to 2.5 NA Private
Freeport Area Enterprises Inc. Freeport, PA 10 150 Private
Freeport Brick Co. Creighton, PA NA NA NA
Heater Specialists, Inc. Tulsa, OK 17 160 Private
Holland Manufacturing Corp. Dolton, IL 25 to 5 20 to 49 Private
Industrial Ceramic Products Inc. Columbus, OH NA NA NA
Industrial Product International Englewood, CO 1 to 2.5 5 to 9 Private
Inland Enterprise Inc. Avon, OH 14 100 Private
International Chimney Corp. Williamsville, NY 18 140 Private
Lousiville Firebrick Works Grahm, KY NA NA NA
Maryland Refractories Co. Irondale, OH 1 to 2.5 NA Private
Mt. Savage Firebrick Co. Frostburg, MD NA NA NA
P-G Industries Inc. Pueblo, CO 12 160 Private
Plibrico Co. Oak Hill, OH 10 to 20 20 to 49 NA
Porvair Corp. Hendersonville, NC 18 200 Private
Refractories Sales and Service Bessemer, AL NA NA NA
Co. Inc.
Reno Refractories Inc Morris, AL 16 85 Private
Resco Refractories, Inc. Norristown, PA 50 500 Private
RHI Refractories America NA NA NA
Riverside Clay Co. Inc. Pell City, AL 15 100
Rutland Products Jacksonville, FL NA NA NA

(continued)

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 DRAFT

Table 4-5. Characteristics of Small Businesses in the Refractory Industry (continued)

Sales Organization
Company Location ($106) Employment Type
Servsteel Inc. Morgan, PA
Shenango Refractories, Inc. New Castle, PA 5 to 10 20 to 49 Private
Nock and Son Co., The Oak Hill, OH 2.5 to 5 10 to 19 Private
Whitacre-Greer Fire Proofing Alliance OH 5 to 10 NA Private
Co., The
Thorley Refractories Inc. Southgate, CA 5 to 10 20 to 49 Private
Utah Refractories Co. Lehi, UT NA NA NA
Zero Refractories, Inc. Taylor MI 0.5 to 1 1 to 4 Private
BNZ Materials Inc. Littleton, CO 25 150 Private
CFB Industries Inc. Chicago, IL 23 176 Private
Insul Co. Inc. East Palestine, OH 15 77 Private
Pyrotek Inc. Spokane, WA 50 to 100 NA Private
Thermatex Corp. (Thermalite) Fremont, OH 10 148 Private
Universal Refractories Inc. Wampum, PA 24 130 Private
Advanced Ceramics Cleveland, OH 21 175 Private
Internaitonal Inc.
Allied Mineral Products Inc. Columbus, OH 56 240 Private
Alumitech Inc. Canada 77 447 Public
AMPAC Amsterdam, NY 13 100 Private
B S C Holding Inc. Shawnee Mission, 23 15 Private
KS
Bartley Crucible & Trenton, NJ NA NA NA
Refractories, Inc.
Blash Precision Ceramics, Inc. Houston, TX 63 515 Private
(Texas United)
CCPI Inc. Blanchester, OH 25 to 50 NA Private
Cercom Inc. Vista, CA 11 76 Private
Chicago Firebrick Co. Inc. Chicago, IL 18 58 Private
JW Hicks Inc. Merrellville, IN 5 to 10 20 to 49 Private
Magneco/Metrel Inc. Addison, IL 34 150 Private
Minco Acquistion Corp. Midway, TN 21 170 Private

(continued)

4-15
 DRAFT

Table 4-5. Characteristics of Small Businesses in the Refractory Industry (continued)

Sales Organization
Company Location ($106) Employment Type
Mixed Mineral Products Inc. Columbus, OH NA NA NA
Monofrax Inc. Falconer, NY 50 to 100 250 to NA
499Private
Newport Sand & Gravel Co. Newport, NH 13 100 Private
Inc.
Pell Industries Grove City, PA 5 to 10 20 to 49 Private
Prefromix Technologies LTD Warren, OH 10 75 Private
Premier Services, Inc. Bettsville, OH NA NA NA
Rex Roto Corp. Fowlerville, MI 14 80 Private
Silicon Carbide Products Inc. Elmira, NY 1 to 2.5 5 to 9 NA
Spar, Inc. Jacksonville, FL NA NA NA
Bethlehem Corporation, The Easton, PA 14 117 Private
Varsal Instruments Inc. Warminster, PA 15 224 Private
Wulfrath Refractories Inc. Tarentum, PA 22 115 Private
Zircar Products Inc. Florida, NY 12 85 Private

companies that produce both clay and nonclay refractories are small. These are shown in
Table 4-5.

4.4 Current Trends in the Refractory Industry

To remain competitive, refractory manufacturers have continued to improve raw

materials and manufacturing and testing processes. The trend toward increased lining life in
most applications has reduced the costs of repair and replacement to refractory consumers.
Improvements in the production process of steel, glass, and petrochemicals in combination
with improvements in refractory products and linings have culminated to reduce the amount
of refractory consumption. Recently, the basic oxygen steelmaking furnace linings have
exceeded 20,000 heats. The glass industry has experienced increased time between repairs in
glass furnaces from every 4 years to 13 years, with little or no preventative maintenance
(Sheppard, 2000; Anonymous, 2000). From 1998 to 1999, the refractory industry reported a
6 percent decline in production and a 12 percent decline in turnover (DHAN, 2001).

4-16
 DRAFT

SECTION 5

MARKETS

This section provides data on domestic production, domestic consumption, imports,

and exports of refractories. It also includes data on gross margin growth in prices. Finally,
this section discusses trends and projections for the refractory industry.

5.1 Market Data

This section provides data on volumes of refractory products produced and consumed
in the U.S., the quantities imported and exported, and prices. Figure 5-1 illustrates refractory
production trends from 1977 to 1998.

3 ,0 0 0

2 ,5 0 0

2 ,0 0 0

1 ,5 0 0

1 ,0 0 0

500

0
77

78

79

80

81

82

83

84

85

86

87

88

89

90

91

92

93

94

95

96

97

98
19

19

19

19

19

19

19

19

19

19

19

19

19

19

19

19

19

19

19

19

19

19

C la y N o n c la y T o ta l

Figure 5-1. Historical Refractory Production Trends

Note: All financial figures are adjusted for inflation using the Producer Price Index available from the U.S.
Bureau of Labor.

5-1
 DRAFT

5.1.1 Domestic Production

During the last two decades, the refractory industry has been affected by declining
demand for traditional refractory products, such as bricks and shapes, and customer
requirements for higher quality special refractories. Accounting for nearly 40 percent of all
shipments, bricks and shapes are the principal forms of refractory products produced in the
United States (USITC, 1993). Table 5-1 illustrates the values of domestically produced clay
and nonclay refractories from 1977 to 1998 in both current and 1998 dollars.

5.1.2 International Trade

As indicated in Table 5-2, international trade is not a major component of the U.S.
market for refractory products. In 1999, refractory exports accounted for a little over 16
percent of shipped refractory products. Nations with significant iron, steel, cement, and
nonferrous metal industries, including the United States, Europe, and Japan, are the major
world markets for refractory products. From 1988 to 1992, Canada was the leading importer
of U.S. refractory products, with over 38 percent of all exports, followed by Mexico.
Emerging foreign markets for the United States include India, China, and other countries in
Central and South America. Japan and Canada are the top suppliers of imports to the United
States (USITC, 1994).

5.2 Market Prices

Table 5-3 lists some average prices for refractory products for 1989, 1993 and 1998.
Most refractory products are typically used in kilns and ovens and are refractories engineered
for a particular use. Price is typically based on the consumer’s requirements.

5.3 Industry Trends

In the last decade, the refractory industry has experienced significant restructuring.
Two large conglomerates, RHI and Vesuvius, dominate refractories markets (Sheppard,
2000). In 1999, Alpine Group sold its Premier Refractories unit to Cookson Group of the
U.K., and Global Industrial Technologies (parent of Harbison-Walker Refractories) was
acquired by RHI AG (formerly Radex Heraklith Industriebeteiligungs) of Austria. Other
leading refractory producers are Allied Mineral Products, Baker Refractories, Minerals
Technologies (via MINTEQ), Morgan Crucible, National Refractories Holding Co., Resco
Products, and Compagnie de Saint-Gobain.

5-2
 DRAFT

Table 5-1. Production of Refractories: 1977–1998 ($106)

Clay Nonclay Total

Year Current 1998 Current 1998 Current 1998
1977 607.2 848.9 680.2 950.9 1,287.4 1,799.8
1978 717.3 956.4 864.2 1,152.3 1,581.5 2,108.7
1979 776.9 983.5 934.9 1,183.5 1,711.8 2,167.0
1980 761.6 922.4 975.9 1,182.0 1,737.5 2,104.4
1981 864.2 976.0 1020.9 1,153.0 1,885.1 2,129.0
1982 670.3 738.4 691.0 761.2 1,361.3 1,499.5
1983 745.5 813.8 588.9 642.9 1,334.4 1,456.7
1984 868.6 920.1 701.4 743.0 1,570.0 1,663.1
1985 803.0 849.2 755.3 798.7 1,558.3 1,647.9
1986 843.5 931.4 768.5 848.6 1,612.0 1,780.0
1987 788.2 851.2 954.5 1,030.8 1,742.7 1,882.1
1988 836.7 851.0 1,078.1 1,096.5 1,914.8 1,947.5
1989 906.3 892.5 113.3 111.6 1,019.6 1,004.0
1990 922.9 927.0 1,077.6 1,082.4 2,000.5 2,009.5
1991 850.4 872.6 1,009.2 1,035.5 1,859.6 1,908.1
1992 886.8 930.6 1,203.5 1,263.0 2,090.3 2,193.6
1993 758.0 784.6 1,282.2 1,327.1 2,040.2 2,111.7
1994 938.8 929.5 1,232.2 1,220.0 2,171.0 2,149.5
1995 958.2 896.2 1,370.4 1,281.7 2,328.6 2,178.0
1996 977.3 953.6 1,459.4 1,424.0 2,436.7 2,377.6
1997 1,101.6 1,072.9 1,631.2 1,588.7 2,732.8 2,661.6
1998 1,082.8 1,082.8 1,535.8 1,535.8 2,618.6 2,618.6

Sources: U.S. Department of Commerce, Bureau of the Census. 1994b. 1992 Census of Manufactures, Industry
Series—Cement and Structural Clay Products. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1995. 1993 Annual Survey of Manufactures.
M93(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1996. 1994 Annual Survey of Manufactures.
M94(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1997. 1995 Annual Survey of Manufactures.
M95(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1998. 1996 Annual Survey of Manufactures.
M96(AS)-1. Washington, DC: Government Printing Office.
U.S. Department of Commerce, Bureau of the Census. 1999b. 1997 Census of Manufactures, Industry
Series—Manufacturing: Clay Refractory Manufacturing. Washington, DC: Government Printing
Office.
U.S. Department of Commerce, Bureau of the Census. 2000. 1998 Annual Survey of Manufactures.
M98(AS)-1. Washington, DC: Government Printing Office.

5-3
 DRAFT

Table 5-2. Exports and Imports of Refractories: 1993–1999 ($106 1998)

Exports Imports Apparent Consumption

Year Clay Nonclay Total Clay Nonclay Total Clay Nonclay Total
1993 72.8 251.9 324.7 28.8 177.7 206.5 740.3 1,065.2 1,805.5
1994 62.1 262.9 325.5 26.4 183.7 210.1 843.3 992.8 1,836.1
1995 76.8 298.0 374.8 33.2 198.6 231.8 873.8 1,045.6 1,919.3
1996 71.7 314.7 386.4 27.0 211.1 238.2 856.9 1,077.4 1,934.3
1997 81.8 290.1 372.0 27.8 248.3 275.9 863.5 1,197.5 2,061.0
1998 59.6 278.9 338.6 30.9 225.1 256.0 942.0 1,113.3 2,055.3
1999 53.2 287.4 340.6 104.0 218.7 323.2 934.5 989.0 1,923.6

Source: U.S. Department of Commerce, Bureau of the Census. 1993–1999. Current Industrial Reports:
Refractories. MA 32C. Available at <http://www.census.gov/industry/ma32c97>.

Table 5-3. Average Price for Refractory Productsa ($/ton)

Form 1989 1993 1998

Current 1998 Current 1998 Current
Monolithics 451 526 491 544 533
Bricks and Shapes 709 826 782 866 910
1
Other 394 459 442 490 497
1 Other refractory forms consists of ceramic fibers and refractory raw materials that are supplied in lump or
ground form used to manufacture refractories "inhouse."
Source: Freedonia Group. September 1999. "Refractories in the United States to 2003." Profound WorldSearch
<http://www.profound.com>
a
Prices were deflated useing the producer price indes (PPI) from the Bureau of Labor Statistics. 2001.
<http://146.142.4.24/cgi-bin/surveymost>.

A recent study projects that shipments of U.S. refractory products will increase 2.5
percent annually to $2.9 billion in 2003 (Anonymous, 2000). In 1997, refractory products
shipments increased 10.7 percent. The refractory industry typically parallels the steel
industry, which is expected to maintain steady growth in the next few years (Bagsarian,
2001).

5-4
 DRAFT

REFERENCES

Anonymous. 2000. “U.S. Demand for Refractories to Reach $2.8 Billion through 2003.”
Ceramic Industry. Available at <http://www.ceramicindustry.com/ci/cda/
articleinformation/features/bnp_features_item/0,2710,8359,00.html>.

ASM International. 1987. Engineered Materials Handbook. Volume 4: Ceramics and

Glasses. Metals Park, OH: ASM International.

Bagsarian, Tom. January 2001. “Outlook 2001: Hitting Bottom in the First Quarter.” New
Steel Available at <http://www.newsteel.com/2001/0101f1.htm>.

DHAN. 1999. “Industry Report: Refractories Passing through Difficult Times.” Available
at <http://dhan.com/moneyline/991016-refract.html>.

Dun & Bradstreet. 2000. D&B Million Dollar Directory. Series 2000. Bethlehem, PA:
Dun & Bradstreet, Inc.

R.S. Means Company, Inc. 1997, 1998 Building Construction Cost Data. Kingston, MA:
R.S. Means Company, Inc.

Semler, Charles E. 2000. “More about Industry Changes.” Ceramic Industry. Available at
<http://proquest.umi.com/pdqweb?TS...Sid=1&Idx=21&Deli=1&RQT=
309&Dtp=1>.

Sheppard, Laural M.. 2000. “Trends in Refractories Technology: Highlights of the AcerS
Annual Meeting.” Refractories Applications.

The Technical Association of Refractories, Japan. 1998. Refractories Handbook. Tokyo:

The Technical Association of Refractories, Japan.

U.S. Department of Commerce, Bureau of Labor Statistics. 2001. Producer Price Index.
Available at <http://146.142.4.24/cgi-bin/surveymost>.

U.S. Department of Commerce, Bureau of the Census. 1993–1999. Current Industrial

Reports: Refractories. MA 32C. Available at <http://www.census.gov/
industry/ma32c97>.

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 DRAFT

U.S. Department of Commerce, Bureau of the Census. 1994a. 1992 Census of

Manufactures, Industry Series—Abrasive, Asbestos, and Miscellaneous Mineral
Products. Washington, DC: Government Printing Office.

U.S. Department of Commerce, Bureau of the Census. 1994b. 1992 Census of

Manufactures, Industry Series—Cement and Structural Clay Products. Washington,
DC: Government Printing Office.

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