Italy Design Supply Chain Data Hints Economy Is Turning the Page

MILAN — Amid interest rates cuts in the U.S. and Europe, export data especially to the U.S. are sparking optimism at two key design supply chain federations here.

FederlegnoArredo, the Italian federation of woodworking and furniture industries and organizers of the Marmomac trade show, which represents firms from the entire stone production chain, said this week that demand is rising abroad for Italian goods.

On Wednesday, Marmomac said that exports of the Italian natural stone industry, ranked second globally, to the U.S. is driving the sector of stone products, including marble. Demand from the North American nation rocketed 56 percent in the last ten years and 2.6 percent in the first half of the year, versus the first half of 2023.

According to research and business consultancy Nomisma, import demand from the U.S. totaled 3.4 billion euros in 2023 and it is now the main world importer of stone products including raw and processed natural stones and machinery and technologies. Overall, Italy‘s trade balance of stone products rose 2 percent to 1.35 billion euros in the first half of 2024.

Trade show organizer Veronafiere together with Confindustria Marmomacchine, the Italian association of producers and processors of marble, granite and natural stones, Italian trade agency ICE and the Ministry of Foreign Affairs and International Cooperation has been focused strategically on boosting exports to the U.S. further. In May, a consortium of 12 marble firms met with architectural and interior design firms in Chicago. A similar mission is likely to take place in 2025, organizers said.

Sectorwide, finished and unfinished exports from the design industry have been hit over the past year by Houthi rebels targeting vessels in the Red Sea and switching shipping routes has had an impact on everything from retail prices to energy costs.

“Situations like the Middle East conflict and Ukraine…are the sort of situations that create difficulties in making forecasts for exports but not a lot of sectors can boast a trade balance like ours. We have ample export and a contained number of imports,” said Confindustria Marmomacchine honorary president Flavio Marabelli at a press conference in Milan.

Amid interest rate cuts from the Federal Reserve and the European Central Bank, FederlegnoArredo, the Italian federation of woodworking and furniture industries, said exports of Italian furniture in 2024 should remain stable versus 2023, despite falling consumer confidence and restrained spending patterns worldwide.

Overall, companies recorded turnover totalling 4.65 billion euros in the semester, down 5.2 percent versus the same period last year. And while the data was negative, the federation’s president Claudio Feltrin hinted at a trend reversal for the second half of the year. “Despite the slowdown in the first half of the year, many companies are looking to the second half of the year, maintaining a certain, albeit cautious, optimism,” Feltrin said, following revenue growth of 0.8 percent in July with exports rising 3.7 percent. Eyes will also turn to local political measures to boost investment and policies focused on boosting real estate.

“Now, aware that autumn will make the difference, we are also waiting to understand what measures the [Italian] government intends to adopt with the next budget law, regarding support for investments and internationalization, green policies aimed at real estate and energy transition in a broader sense, to understand what’s in store for 2025,” Feltrin said.

Italian companies like Dexelance said the increased appetite for Italian finished goods is palpable. In its first-half results, the Milan-based company that owns a galaxy of home to upscale brands like Saba Italia, Gervasoni and Meridiani said the fresh U.S. interest was a major boost to company sales, which were up 9.2 percent to 151 million euros compared to the same period in 2023. The company opened its first U.S. flagship in New York City last October — a space that hosts dedicated showrooms for Meridiani and Davide Groppi.

Following a series of mixed earnings of listed U.S. furniture firms like RH, Williams Sonoma and Arhaus, TD Cowen said earlier this month that the sector for finished goods in the U.S., isn’t quite out of the woods yet.

Risks to the companies in the sector include uncertainties associated with the global economic environment and consumer spending, as well as general competition within the consumer and fashion products industries and fluctuating consumer demand trends, which can create variability in sales and margins. “Increases in the prices of raw materials, rent, freight, labor, tariffs or manufacturers’ inability to produce goods on time or to specifications may negatively impact results.…Legal, regulatory, political, currency and economic risks, as well as challenges to maintain favorable brand recognition, loyalty and reputation for quality, may affect the ability to conduct business in both domestic and international markets,” the report said.