Overview of the Construction Materials Market in Ukraine
Even amid the full-scale war, the construction market is demonstrating gradual recovery and is characterized by a well-developed construction materials sector that is attractive to investors. Major manufacturers are implementing plans to expand their existing production and create new capacities to meet current market needs and rebuild Ukraine after the war.
According to the World Bank, the cost of rebuilding Ukraine is estimated at more than $400 billion, excluding the temporarily occupied territories. The most significant losses have been recorded in residential buildings and road infrastructure (roads, bridges, and railway facilities), business assets and industry, energy infrastructure, education, and healthcare.
According to the Ukraine Recovery Plan, one of the key national programs is "Recovery and Upgrade of Housing and Regional Infrastructure". This program focuses on constructing higher-quality new buildings following advanced urban planning practices and sustainable development principles, with the possibility of integrating key EU policies on the Green Economy transition and digital transformation. The estimated funding for this initiative ranges from $150 billion to $250 billion.
Foreign investors are actively engaging in the construction sector of Ukraine. For example:
CRH, one of the largest construction materials producers, owns three cement plants in Ukraine under the CEMARK brand and has already invested $80 million in Ukraine since the full-scale invasion. In 2023, the company signed a mandate letter with the EBRD to jointly acquire the assets of Italian Buzzi in Ukraine. The deal is estimated at $100 million and is currently being reviewed by the Antimonopoly Committee of Ukraine (AMCU).
The French group Saint-Gobain began construction of a dry construction mix production plant in October 2023 near the Khotymyr gypsum deposit in the Ivano-Frankivsk region. The deposit is developed by its subsidiary, Trojan Gypsum. The investment in the plant amounts to €9 million.
The German company Kreisel has started building a dry construction mix and decorative coatings plant in the Shchyrets community near Lviv. The project is estimated at €12 million and has investment insurance from the German government. Kreisel also launched a liquid construction mix production line (Fixit) at its plant in Fastiv. It is expected that Kreisel Building Materials LLC in the Kyiv region (a subsidiary of the German Fixit Gruppe) will become the company's largest facility in Eastern Europe.
The German company Knauf is starting construction of a new plant in Ukraine for the production of drywall and dry construction mixes. The new enterprise will be located in the town of Borshchiv, Ternopil region. The official stated that the plant will have an annual capacity of 30 million square meters of drywall and 320 thousand tons of dry mixes, with a total investment of $150 million in the project.
Aerated Concrete Market
In Ukraine, there is an increased interest in the use of energy-efficient materials and systems in construction, including aerated concrete. Heat insulation materials with high thermal conductivity, innovative windows and doors with improved thermal insulation properties, energy management technologies help reduce energy consumption in buildings. New energy-saving systems, including smart homes, energy-efficient lighting and energy management systems, are also being developed and applied.
11 plants with a total capacity of 4.5 million cubic meters produced autoclaved aerated concrete wall and partition blocks on the Ukrainian market. The main industrial capacities of the sector are provided by 5 out of 11 plants.
Market capacity: 2021 – about 5 million cubic meters; 2022 – 1.7 million cubic meters; 2023 – 1.8 million cubic meters.
The share of exported aerated concrete products in the total production in 2022 was $512 thousand. In 2023, exports were insignificant and amounted to $361 thousand.
The volume of exports amounted to about $729 thousand. The main exported products are "Building blocks and bricks (including lightweight concrete products)" mainly to Romania, Moldova and the Czech Republic.
Concrete and Reinforced Concrete Products Market
Concrete mixes includes cement, lime, sand and other special admixtures that create specific properties and add strength. The Ukrainian market is represented by dry mixes (for finishing works) and liquid concrete (direct deliveries from the manufacturer to order for ongoing construction).
The share of the 10 largest producers of concrete products is about 40% in 2023. In total, there are about 300 companies operating in the market, 25 of which have production capacities of more than 50 thousand tons per year. Producers of concrete mixtures and reinforced concrete products usually share production facilities and offer a wide range of concrete products (concrete products, paving stones, etc.).
Concrete mixes market capacity: 2021 – 25.8 million tons; 2022 – 6.1 million tons; 2023 – 7.3 million tons; first half of 2024 – 3.8 million tons. Production of reinforced concrete products reflects similar dynamics to changes in real construction. In 2023, the market recovered to 1.55 million tons.
Main product groups by export volume in 2022-2024:
Paving Stones Market
Paving stones (paving slabs, shaped paving elements) are widely used for the construction of pedestrian or automobile paths, playgrounds, courtyards, parks, gardens and other landscaped areas. The market involves both large enterprises with a wide range of construction products and small regional companies with a limited range of products of one type. The market is characterized by seasonality of production and consumption.
The domestic market is mainly supplied by domestic products, with insignificant imports and exports. Before the war, the market capacity was estimated at about 4.2 million tons per year. The total number of companies in the market is 767, employing over 1200 workers.
Exports from 2022 to 2024 were directed to 54 countries. The largest volume was going to Poland, Lithuania, Romania, Latvia, Germany and Azerbaijan:
Cement Market (including cement clinkers, whether or not colored)
Cement is the most widespread building material used to build structures and high-strength products. Producers make both different grades of cement and products based on it (concrete, reinforced concrete products, gypsum products, dry building mixes, and other construction materials).
The market includes 10 major manufacturing companies, employing about 3600 workers.
Cement production volume: 2023 – 7.4 million tons, first half of 2024 – 3.8 million tons.
From 2022 to 2024, the company exported cement of various grades, portland cement, and clinker. The largest volumes were directed to Austria, Moldova, Poland, Hungary and other countries: 2022 – $60.57 million; 2023 – $58.48 million; 2024 – $117.8 million.
Dry Construction Mixes Market
The dry construction mixes market includes products for leveling surfaces (wall putties, self-leveling floor compounds), masonry and tile adhesives, decorative plasters, and more. As of September 2024, 132 legal entities were registered in the sector, employing over 3500 workers.
The market capacity before the war was estimated at 1.5 million tons, with 95% of demand covered by domestic manufacturers. Recovery in 2023 is estimated at 1.2 million tons. By the end of 2024, the total production of dry construction mixes in Ukraine was 951 thousand tons.
In 2023, Ukraine exported dry construction mixes to 37 countries, totaling $3.2 million. In 2024, exports increased and amounted to $4.8 million. The main export destinations were Moldova, Poland, Latvia, Azerbaijan, and others.
Crushed Stone Market
Crushed stone is a basic product and a universal aggregate used in most construction materials and for all construction projects. Ukraine is one of the largest producers of crushed stone in Europe, and its production volumes are constantly increasing.
The market includes 1,260 enterprises, employing over 2000 workers. In 2022, crushed stone production amounted to 120 million tons. In 2023, production was reduced by half, but foreign trade volumes increased.
The main exporting countries in 2022-2024 were Poland, Moldova, Lithuania and other countries: 2022 – $5.3 million; 2023 – $5.3 million; 2024 – $18.4 million.
Glass and Quartz Sand Market
Ukraine has the largest reserves of quartz sand in Europe and exports it to various countries. However, finished glass used for glazing is imported into Ukraine.
According to Geoinform of Ukraine, there are 42 quartz sand deposits in the country. The largest reserves are concentrated in the Kharkiv region and amount to about 100 million tons. One-third of the total reserves are located in Lviv (30.1 million tons), Donetsk (around 28 million tons), and Zaporizhzhia (about 25 million tons) regions, with an additional 20 million tons in Chernihiv region.
The glass industry is the largest consumer of quartz sands in the world (up to 40%). The main consumers of quartz sand are sheet glass manufacturers, glass containers and tableware manufacturers. There is no production of sheet or float glass in Ukraine. The largest factor of influence is the container glass market, which is relatively developed. In total, 843 legal entities and individual entrepreneurs are registered in the country, whose main activity is the production of glass and glassware products.
In 2023, exports in the category «Glass, glass scrap; glass in blocks» were directed to Moldova and amounted to $1.99 billion. No products of this category were exported in 2024.
The export of float glass primarily involved transit supplies, glass products, and glass cullet. Exports were mainly directed to Poland, Germany and Moldova: 2022 – $413 thousand; 2023 – $236 thousand; 2024 – $128 thousand.
The introduction and implementation of new float glass manufacturing projects could meet domestic market needs and create opportunities for the development of the export potential of this sector. The estimated domestic market demand is $175 million, while the export potential could reach $20 million (1% of total float glass imports in Europe).
Kaolin Market
Kaolin is widely used in the manufacture of ceramic, earthenware and porcelain products, as well as in paper and other industries, depending on the type and grade of raw material. Ukrainian kaolin is used domestically, including by companies with foreign capital, and exported abroad.
There are 17 mining companies operating in the market, with a total of 963 workers. Kaolin extraction volumes: 2021 – 2.5 million tons; 2022 – 840 thousand tons; 2023 – 684 thousand tons.
Kaolin was exported to 36 countries, with the main destinations being Turkey, Germany, France, Italy, Poland and other countries: 2022 – $24.5 million; 2023 – $11.6 million; 2024 – $20.9 million.
Ceramics Market (tiles, sanitary ware)
The Ukrainian ceramic market consists of ceramic tiles and ceramic sanitary ware, both of domestic and foreign production. Market capacity in 2023: ceramic tiles – $522 million, ceramic sanitary products – $150 million.
Export of ceramic tiles:
The main exporting countries of ceramic sanitary ware are Poland, Romania, the United Kingdom, Germany, Italy, Moldova, France, and other countries. The volume of exports amounted to: 2022 – $20.1 million; 2023 – $19.5 million; 2024 – $29 million.
Drywall Market
Drywall is a versatile building material, often used as the main structure for interior partitions, walls, ceilings, and other surfaces. In 2021, the production of drywall amounted to 51.9 million square meters. Since mid-2022, production has decreased by 9.3 times. In 2023, drywall production was partially restored
The main export destinations were Moldova, France, Sweden, Bulgaria and Germany. Until 2022, domestic production almost fully covered domestic demand, with export volumes reaching $1.12 million. In 2023, exports amounted to $1.6 million and $2.6 million in 2014.
Paint and Varnish Market
The Ukrainian paint and varnish market consists of domestic production (82-85%) and imported products (15-18%). The overall production dynamics align with the construction market trends. Ukraine mainly produces mass-market, low-cost paints, while higher-end products are imported. Domestic manufacturers focus on meeting local demand, resulting in minimal export activity.
In 2023, paints and varnishes were exported to 28 countries of the world for $8.9 million. In 2024, exports amounted to $11.02 million. Main exporting countries – Moldova, Poland, Georgia, Turkey, Austria and others.
Mineral (Basalt) Wool Market
Mineral (basalt) wool is an insulation material with high fire resistance properties. It is widely used in construction as an alternative to foam plastic and polystyrene, offering flexibility, lightweight properties, and easy installation.
In Ukraine, three companies produce basalt wool. Market capacity: 2021 – 225.1 thousand tons; 2022 – 125.1 thousand tons; 2023 – 181.1 thousand tons.
Ukrainian mineral wool is in demand in foreign markets. The main exporting countries are Romania, Sweden, Moldova, Slovakia and other countries. Export volumes: 2022 – $16.2 million; 2023 – $21.8 million; 2024 – $30.6 million.
Polystyrene Foam Market
Polystyrene insulation materials are widely used in construction for both external and internal works. The Ukrainian market is supplied by domestic production, with imports accounting for 2-6% over the past three years.
Among 327 manufacturing enterprises, 13 are key producers. In total, about 1700 workers are involved in the production of expanded polystyrene insulation. Market capacity: 2021 – 30 thousand tons; 2022 – 21.4 thousand tons; 2023 – 24.5 thousand tons.
Exports in 2022 amounted to $24 million. In 2023, Ukraine exported polystyrene insulation to 15 countries, totaling $18.8 million. In 2024, European countries remained the main export destinations, with a total export value of $25.8 million.
Composite Mesh and Rebar Market
Composite mesh and rebar are modern alternatives to steel counterparts and are gaining popularity worldwide due to several advantages, including corrosion resistance, strength, durability, low thermal conductivity, and non-conductivity of electricity. Globally, the products are widely used in the construction of infrastructure facilities (roads, tunnels, airports).
In Ukraine, six companies produce composite reinforcing materials, employing up to 100 workers. The production volume in 2023 was estimated at 2.5 thousand tons.
The market is represented by Ukrainian-made products. There were no imports of composite reinforcing materials from 2021 to 2024. Exports in the pre-war period amounted to about 22%, in 2023 the share of exports is estimated at 3% of total production.
In 2023, exports amounted to $333 thousand, primarily to Poland, Estonia, and Cyprus. In 2024, composite materials worth $181 thousand, mainly to Poland, Estonia, and Hungary.
Plastic Pipes Market
The Ukrainian market of polymer pipes is represented by products made of vinyl chloride, ethylene, and propylene. The use of polypropylene and polyethylene pipes extends to engineering structures and communications, including sewage systems, gas and water supply applications. Polyethylene has also replaced a number of metals in engineering piping systems. The majority of polymer pipes produced in Ukraine are focused on domestic consumption, with approximately 70% of the market consisting of locally manufactured products.
The exports in 2023 amounted to $23.7 million into 81 countries. The total amount of export was $29.4 million in 2024. The main exporting countries are Belgium, United Kingdom, Romania, Moldova, Poland, Latvia, and the Netherlands.
Steel Pipe and Sheet Market
The domestic demand for steel products in Ukraine is rising due to the need to restore infrastructure facilities, build fortifications, and repair and modernize military vehicles.
In 2022, Ukrtruboprom's member companies produced a total of 449.7 thousand tons of pipe products. In 2023, the companies increased production to 495.4 thousand tons and continued to recover in the first quarter of 2024 with an increase of 13%.
Ukraine exported pipe products to 67 countries, totaling $503.8 million in 2023. Exports in 2024 amounted to $648.2 million. The main exporting countries are Germany, the United States, Poland, and Italy.
Stakeholders
The Confederation of Builders of Ukraine is the largest industry union, representing over 900 members, and more than 100,000 employees in the construction and related sectors, and has a presence in all regions of Ukraine. The Confederation was established in 2011.
The Association of Aggregates Producers of Ukraine is a non-governmental and independent association of enterprises engaged in the extraction of minerals for the production of aggregates building materials (crushed stone, rubble stone, screenings, etc.).
The National Association of Extractive Industries of Ukraine, whose main goal is to create a transparent, competitive and ergonomic business environment in the field of subsoil use for the sustainable development of Ukraine.
The research was conducted by Pro-Consulting LLC at the request of the Entrepreneurship and Export Promotion Office.