Source: Portland Cement Association, Skokie, Ill.
Improving underlying economic fundamentals, large pent-up demand balances, and diminished economic uncertainty will support an 8.1 percent increase in 2013 cement consumption and concrete output over last year’s levels, according to a revised PCA forecast.
The projection for this year is 2.1 percent higher than a preliminary figure issued last fall, the positive adjustment reflecting business stability in light of the recent fiscal cliff accord among federal lawmakers; recognition of stronger economic momentum; and, markedly more optimistic assessments regarding residential construction activity. The new forecast also factors tailwind as the industry enters the new year: 2012 U.S. cement shipment totals are on track to reach 78.5 million tons—an 8.9 percent gain over 2011 consumption. The first quarter of 2013 might show a decline against prior year figures, however, owing to favorable 2012 conditions versus a weakening in market fundamentals.
“Growth in 2013 cement consumption will be largely driven by gains in residential construction,” says PCA Chief Economist Ed Sullivan. “Housing starts should reach nearly 950,000 units, with single family construction near 700,000 starts. We see starts hitting the one million mark in 2014 or 2015.”
Accelerated cement consumption predicted during the second half of 2013 should carry into the following year, where PCA projects an 8.3 percent shipment increase over this year’s total. Sullivan has also upwardly revised projections for 2015–2017 cement and concrete demand, where annual growth rates could reach 9.2 percent.