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Cement Industry Foresees Steady Growth

Wednesday, May 12, 2010

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Expected increases in public construction activities will mean improved cement consumption in 2010 and beyond, according to a new forecast by the Portland Cement Association (PCA).

For 2010, PCA anticipates a modest 5% increase in consumption over severely depressed 2009 levels. Cement use should increase by 3 million to 5 million metric tons during the second half of the year. A 13.3% jump is predicted for 2011, followed by an 18.7% increase in 2012.

"The 2010 recovery in cement consumption lays largely on expectations for public construction activity," said PCA Chief Economist Edward Sullivan. "Spending from the stimulus bill will more than double to $12 billion, and that spending is expected to reflect an increased share of major highway construction and bridge projects—high cement-intensive projects."

Although nonresidential sectors like oil and farm construction are expected to contribute to this year’s increase in cement consumption, consumption accrued to commercial building will decline 29% on top of a 38-year low reached in 2009. For the first time since 2005, the residential sector is expected to become a modest contributor to growth during 2010.

"The economy is recovering and improving its core fundamentals,” Sullivan said. “However, recovery for the construction markets will be slowed by the continuation of tight lending conditions, high foreclosure rates and weak job markets."

Based in Skokie, Ill., the Portland Cement Association represents cement companies in the United States and Canada. It conducts market development, engineering, research, education, and public affairs programs. More information is available at www.cement.org.

   

Tagged categories: Market research; Trends

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