The dry construction market is estimated to be valued at USD 92.14 Bn in 2024. The market is projected to witness substantial growth over the next years driven by rising residential and commercial construction activities across developed as well as developing regions. The dry construction market is expected to reach USD 129.05 Bn by 2031, growing at a compound annual growth rate (CAGR) of 4.93% from 2024 to 2031.

Market Driver - Increasing Demand for Sustainable Construction Solutions

Global awareness towards protecting the environment and reducing carbon footprint has increased tremendously over the past decade. Sustainable development has become one of the most discussed topics across all industries. The construction industry, being a major contributor to greenhouse gas emissions and resource depletion, is witnessing a paradigm shift towards greener construction methods.

Dry construction methods have gained widespread acceptance due to their inherent sustainable qualities. Dry construction uses prefabricated building components like drywalls, partitions, ceilings etc. that are manufactured off-site and simply installed on location. It also requires less on-site labor and machinery, translating to lower energy consumption during the construction process. The growing awareness about reducing carbon footprint of buildings throughout their life cycle through resource efficient techniques will boost the dry construction market.

Market Driver - Growth of Urbanization and Environmentally Friendly Construction Methods

According to projections, about 68% of the world population will reside in urban areas by 2050 versus the current 56%. This unprecedented rate of urban growth is exerting tremendous pressure on construction industry to supply buildings and civic amenities for expanding cities.

Dry construction methods have emerged as a feasible solution to address this urbanization challenge while remaining environmentally sustainable. It remains an ideal choice for high-density urban projects where tight deadlines, space constraints and manpower management are major issues. Dry construction enables faster completion of complex building structures in congested urban settings.

Dry construction is rightly positioned through its green and efficient profile to play a pivotal role in enabling sustainable urbanization. Its ability to deliver advanced construction needs of future metropolitan areas while minimizing environmental impacts makes it an indispensable solution for growing urban construction sector. This promises considerable opportunities for dry construction market in the coming years.

Market Challenge - High Initial Costs of Dry Construction Techniques

One of the major challenges faced by the dry construction market is the high initial costs associated with dry construction techniques compared to traditional wet construction methods. Dry construction offers long term benefits such as faster construction times, reduced wastage, improved quality, and lower life-cycle costs. However, the upfront capital requirement for setting up dry construction supply chains and procuring modern machinery can be significantly high.

Rising capital expenditure poses major entry barriers for construction firms in adopting dry construction methods. This is especially true for smaller and medium scale projects in the dry construction market where returns may not justify the initial costs.

Additionally, greater emphasis needs to be placed on educating both private and public sector clients about the long term monetary and non-monetary benefits of dry construction. This can encourage more widespread acceptance and commitment to such techniques. With increased awareness and support, initial hurdles in costs of new technology adoption can be overcome to drive broader growth of dry construction activities.

Market Opportunity - Rising Investment in Modular and Prefabricated Construction

One major opportunity being presented to the dry construction market is the rising global investment directed towards modular and prefabricated construction methods. Modular building involves the construction of sections or modules of a structure in an off-site manufacturing facility which are then transported and assembled onsite. On the other hand, prefabrication involves the pre-assembly of major building components or assemblies off-site prior to installation.

Both these processes rely heavily on dry construction techniques like panelized wall systems, precast concrete, and modern framing. They offer the dual advantages of improved quality, faster project execution time, minimized disruption and costs savings over traditional wet construction.

Considerable financial support is flowing into R&D of new building systems, supply chain infrastructure and skills development. Growing traction and backing presents a major potential opportunity for dry construction material manufacturers to scale up operations and cater to the rising demand.

Focus on innovation and new product development: One of the major strategies adopted by leading players like Armstrong World Industries, Etex Group, Fletcher building, Saint Gobain, Xella Group and CSR Limited has been continuous investment and focus on innovation to develop new products. For example, in 2018 Armstrong introduced new ceilings and walls made from recycled materials which helped improve sustainability.

Mergers and acquisitions: Companies have actively pursued the inorganic growth strategy of mergers and acquisitions to expand product portfolio and geographical presence. For example, in 2017 Xella Group acquired Italpannelli to expand in Italy.

Focus on emerging markets: Given the higher growth rates in developing economies, companies focused marketing and distribution efforts in emerging markets of Asia and Latin America.

Increased distribution network: Leading players substantially increased their distribution networks to ensure wide availability and quicker deliveries.

Insights, By System: Customizable Solutions Drive the Wall System Segment

The wall system segment dominates the dry construction market with 38.5% share in 2024. This is owing to its ability to provide customizable solutions. Wall systems allow for immense flexibility in design and layout of dry construction projects. Contractors and builders can install movable or demountable interior walls to divide large spaces into comfortable work areas.

A key strength of wall systems is their versatility. They support various wall coverings and surface finishes such as paint, wallpaper, and tiles. This makes them suitable for both commercial and residential applications. Companies offer a wide assortment of wall panels in varied textures, patterns, and styles. Further, stringent norms around noise pollution have boosted the adoption of wall systems that meet regulatory standards for sound insulation.

Sustainability is another factor influencing construction preferences. Wall systems have lower environmental impacts than traditional brick-and-mortar structures as they require less material to build. Further, panels are reusable if buildings undergo refurbishment, avoiding wastage. Growing emphasis on sustainable construction will augur well for the wall system category in the dry construction market.

Insights, By Material: Robust Fire Resistance of Plasterboard Drives its Uptake

Among materials, plasterboard commands 42.1% share of the dry construction market in 2024, owing to its robust fire resistance. Construction codes impose strict regulations around ensuring fire safety in buildings. Plasterboard walls and partitions help construct reliable barriers against the spread of fire.

Unlike other materials, plasterboard does not readily melt, shrink, or collapse at high temperatures. Its interior gypsum core prevents the passage of flames and keeps toxic smoke and fumes in check. Plasterboard manufacturing involves infusing glass fibers into gypsum, enhancing its rigidity and durability against impact and cracking.

Contractors prefer plasterboard for its consistent quality. The uniform density and composition prevent weaknesses or variations that may compromise fire performance. Furthermore, large inventory availability from multiple suppliers minimizes project delays. Installation is also hassle-free, with panels cutting and fitting together neatly using mechanical fasteners. These virtues will continue bolstering plasterboard consumption in the years ahead.

Insights, By Type: Extensive Application Scope Boosts Boarding Segment

The boarding segment dominates the dry construction market owing to its extensive application scope across verticals. Boarding materials form the principal load-bearing elements of all dry construction systems. Their diversity allows construction of walls, floors, facades, and more based on project needs in the dry construction market.

Plasterboard remains the core material for Boarding due to its moldable nature. Wood-based boards like plywood and particle boards are also extensively used for boarding. Plywood finds applications in flooring systems while OSB boards reinforce wall studs. Metal boards make durable alternatives, offering strength, and rigidity for load-bearing purposes.

Strict emission regulations favor dry-built boarding over wet-built approaches. Dry construction causes negligible environmental disturbance during installation. It also ensures occupant health through zero-VOC emitting materials. Such attributes will continue augmenting boarding material usage across both residential and commercial verticals in the dry construction market.

• Accelerated Residential Construction in Emerging Economies: Multiple countries in Asia-Pacific have reported a significant surge in residential projects, driven by rapid urban migration, increased disposable incomes, and supportive government housing policies. This trend directly propels the demand for faster, more efficient dry construction solutions.
• Adoption Rate: Around 40% of new commercial buildings in developed regions are now employing dry construction methods to reduce project timelines and enhance building performance.
• Regional Dominance: Asia-Pacific leads with a 39.6% share of the global dry construction market in 2023, attributed to large-scale infrastructure developments, ongoing urbanization, and growing preference for modular construction methods.
• Renovation & Retrofit Growth: Roughly 25% of overall dry construction demand is driven by renovation and retrofit projects in mature regional dry construction markets such as North America and Europe.

The major players operating in the dry construction market include Saint-Gobain, PABCO Gypsum, Wienerberger, Sika AG, Ramco Industries Limited, Fullerton Building Systems, YOSHINO GYPSUM CO., LTD, EPACK Prefab, Hangzhou Zhongchuang Electron Co., Ltd., Ravago Hellas Building Solutions, Knauf Gips KG, Etex Group, Armstrong World Industries, Inc., USG Boral, CSR Limited, Xella Group, Fletcher Building, and Panel Rey.