US chemical product makers optimistic for 2026 demand as construction stabilizes

Several US companies closely related to the chemical sector are forecasting stabilization in construction demand for 2026, fostering a positive outlook.

With improved mortgage rates and enhanced market sentiment, companies anticipate better business opportunities, particularly in the repair and remodeling areas.

Repair, remodel optimism

Executives at James Hardie, a leading fiber-cement products company, said during a Feb. 10 recent earnings call that industry demand is stabilizing.

CEO Aaron Erter said the company would focus on both the new home and repair and remodel markets, as "consumer sentiment improves, supported by pent-up demand and modest relief in mortgage rates."

Freddie Mac data showed 30-year fixed mortgage rates closed at 6.09% on Feb. 12, down slightly both from mid-November and year over year. Although US mortgage rates have fallen consistently over most of 2025, they were as high as 7.04% at the start of the year. So far in 2026, they have remained below 6.2%.

Erter pointed to opportunities in remodel-focused activities, particularly in the Northeast and Midwest regions.

However, the CEO acknowledged that overall construction activity in the US is "challenging," with "new construction being soft" due, in part, to high inventory levels. But he said they are seeing improvements in market sentiment.

"We are seeing some optimism with our contractors; construction continues to be a challenge, but was not unexpected," the CEO said.

Jonathan Skelly, James Hardie's president of building groups, said the company has numerous opportunities in the new build sector and could focus on offering more decking, railing, and accessory solutions.

Shelter business to flatten

As the construction market in the US shows signs of stabilization "after years of decline," according to DuPont CFO Antonella Franzen, the chemicals and polymers producer anticipates growth in the repair sector, although recognizing "flattish demand" year over year, particularly in the building technologies segment.

During the company's Feb. 10 earnings call, DuPont executives said their shelter business is expected to start 2026 slightly down before improving through the year, meaning an overall flat performance for the full year. The segment, which comprises building technologies products used in residential and commercial construction applications, declined in the mid-single digits in 2025, according to the company's results.

The outlook for 2026 includes low single-digit growth in non-residential construction and repair, and mid-single-digit declines in residential construction, Franzen said.

At the same time, the company expects stronger growth from its industrial segments, particularly in aerospace and health care. CEO Lori Koch said that the company is seeing "nice low double-digit improvement" in aerospace orders, which comprises about 3% to 4% of total revenue.

Reviewing product mix

Advance Drainage Systems, US manufacturer of propylene and polyethylene pipes and water management solutions, said it observed a mixed demand environment and weaker sales in the residential and infrastructure markets, which affected its pipe revenue during the fourth quarter of 2025.

"Sales in the residential end market were down as it remains under pressure," CEO Donald Barbour said during the company's Q4 earnings call Feb. 5.

Barbour also said that some outlets saw improved results due to multifamily construction and single-family residential development, especially in the Atlantic Coast and Southeast. However, the DIY segment remained weak.

ADS CFO Scott Cottrill added that the company is focused on enhancing its profitability resilience by reviewing its product mix to ensure greater consistency and reduce reliance on fluctuating material prices.

"It's not just resin cost that drives our pricing and profitability; the volume side of housing and demand for housing are pretty important," Cottrill said.

According to data from the American Chemistry Council, high-density polyethylene pipe and conduit sales in the US and Canada decreased 9% in the last quarter of 2025. Specifically, water pipe sales decreased 4%, while total water pipe sales reached 751 million pounds in 2025, 3% lower than in 2024.

Platts is part of S&P Global Energy.