Global Autoclaved Aerated Concrete (AAC) Market Estimated to reach more than US$ 20 Bn by 2026

Autoclaved aerated concrete (AAC), also known as autoclaved cellular concrete (ACC) or autoclaved lightweight concrete (ALC), is an eco-friendly green building material. The raw material used for the production of AAC is fly ash, which is a leftover product of thermal power plants. AAC has various advantages over other building materials. The product offers a unique combination of low weight, rigidity of construction, durability, and cost-effectiveness. AAC facilitates speedy construction. The product offers thermal and acoustic insulation, providing better safety and lower energy cost of heating or cooling. Although AAC has been in existence since 1923, it is only now that the product has started gaining popularity as a sustainable green building material. The product has been extensively used in Europe and Asia.

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Rapid Urbanization in Developing Regions
Accelerated urbanization, particularly in developing regions such as Asia Pacific, Latin America, and Africa, is creating the need for new building construction. AAC has been the preferred choice of building material for developers and contractors as it is a lightweight and energy efficient material. For instance, the percentage of urban population in Asia Pacific is likely to increase from 37% in 2000 to 62% by 2020, and this is likely to create need for new construction, thereby propelling the demand for AAC. The primary energy needed to produce a cubic foot of AAC (raw materials, manufacturing, and transport) is relatively low compared to that for alternative masonry building materials.

Energy consumed for the production of AAC is less as compared to that for other building materials. AAC consumes approximately 50% and 20% less energy as compared to concrete and CMUs, respectively. Tiny air pockets and thermal mass of AAC offer thermal insulation that reduces construction costs related to heating and air-conditioning. AAC reduces heating and cooling requirements by up to 30% due to its thermal insulation properties, resulting in continued financial benefits during the life of the construction. Hence, AAC is the most energy- and resource-efficient building material. This is expected to drive the AAC market during the forecast period.

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Cost Associated with AAC and Lack of Awareness about AAC
The selling price of AAC blocks is higher than that of traditional clay bricks. Clay bricks account for a significant market share in building materials and are widely used as a construction material as they are cheaper as compared to AAC blocks. Higher cost of AAC as compared to clay bricks can act as a restraint for the AAC market. AAC is superior compared to other building materials based on various parameters. However, several contractors are not even aware of it, and they continue using other building materials. More precision is required in the application of AAC. For instance, trained masons need to be adjusted to thin mortars as opposed to traditional cement-based mortars. Additionally, the number of AAC production facilities is limited, particularly in North America. This construction material is available in limited areas only.
Low Market Penetration offers Significant Market Opportunity
AAC blocks currently account for only 3% share of the total market for walling materials. This is attributed to the lack of awareness about AAC. Hence, builders, contractors, and construction professionals continue using traditional building materials, which hold significant share of the walling materials market. Currently, the market penetration of AAC is low, but this also presents significant opportunity for the industry to expand and use AAC as an innovative green building solution.
AAC is not a new invention. The product has been in the market since 1923. It has undergone significant development over the years, and it is being used as a green building construction material. AAC has been employed in Europe since 1920. Currently, over 125 AAC manufacturing facilities exist in Europe that produce around 28 million cubic meters of AAC every year. Aerated concrete is used as a building material in around 500,000 homes every year in Europe.
Currently, AAC accounts for more than 60% share of the construction industry in Germany and more than 40% in the U.K..Over the years, the construction sector in China has expanded significantly. China is also a major producer of AAC. The country has undertaken an initiative for green building to protect natural resources, reduce energy usage, and improve air quality. In 2013, China’s State Council launched the Green Building initiative with an eye on constructing 20% of all new buildings by fulfilling specific green building requirements.
Currently, there exist more than 3,500 AAC manufacturing facilities around the globe, with a significant number of them concentrated in countries such as China, Russia, Poland, Germany, Sweden, and the U.K..

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Major companies are undertaking capacity addition projects to cater to increasing local demand for AAC. For instance, Aircrete Group, after commissioning the largest autoclaved aerated concrete (AAC) plant in Latin America in Mexico in 2017, is expected to invest in a new state-of-the-art AAC facility in Argentina. In association with leading local construction and development companies, the company commissioned a US$ 20 Mn AAC block and panel plant with an initial capacity of 120,000 cubic meters in San Lorenzo, Santa Fe, near the city of Rosario, Argentina. Although AAC has existed in India since 1970, it has gained momentum only recently. In 2003, the green building footprint in India was around 20,000 square feet, and now, it has reached one billion square feet. Currently, India has 1,300 registered green building projects in total. All these parameters are indicative of significant expansion of the AAC market, and they also present a significant opportunity for the market to gain further momentum.
Key players profiled in the autoclaved aerated concrete (AAC) market report include Xella Group, H+H International, SOLBET, ACICO, AERCON AAC, UltraTech Cement Ltd., Biltech Building Elements Limited, AKG Gazbeton, Bulidmate, Eastland Building Materials Co., Ltd., Brickwell, and UAL Industries Ltd.

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