World cement demand tempered by China's slowdown; outlook remains cautious

GREENWICH, Conn. - Sept. 25, 2018 - PRLog -- Global cement consumption is projected to decline marginally to 4.05 billion tons in 2018, according to CW Research's 2H2018 update of the Global Cement Volume Forecast Report (GCVFR). Following a sustained slowdown in Chinese cement demand, and given the Asian giant's weight on the overall worldwide figure, global consumption is poised to record a slim rise of almost one percent per year through 2023. The number increases to over three percent if China is excluded from the world view.

"The global economy has been accelerating since the beginning of 2018, but the recent improvements in growth remain unevenly distributed across countries and regions. Economic prospects for many commodity exporters remain particularly challenging, and fears of future disruption to trade could lead government-driven economies to postpone investments, while higher oil prices could filter through to cramp consumer spending", assesses Raluca Cercel, CW Group's Associate.

US and Europe's growth to ease; Latin America and Africa to recover

In China, cement demand is being dragged down by lack of investment in the real estate and infrastructure sectors. In total, the Chinese cement market is expected to consume 2.55 billion tons of cement in 2018, a decrease of almost three percent compared to last year. The country's economy is now reaching a mature stage similar to that achieved by the western markets 20 to 30 years ago, when demand for cement started to reach its plateau.

In the Middle East, cement consumption is likely to decline in 2018, as the two major producers and consumers in the region – Saudi Arabia and Iran – continue to struggle with overcapacity and sluggish demand domestically. The next five years are believed to bring a recovery in regional cement consumption, underpinned by stronger government revenue, in turn supported by rising crude oil prices.

The forecast for the African continent has been revised downwards from the previous forecast due to lower-than-expected growth in 2018. Consumption in the region is expected to grow by 1.6 percent in 2018 and by 3.6 percent on average per annum through 2023. This year's figures have been negatively impacted by underperformances of the Egyptian, Tunisian, and, especially, the Kenyan markets.

In the United States, CW Research expects cement demand to grow by 2.8 percent on a cumulative annual growth average.

"US cement demand is being propelled by an increasing consumer spending, which is reflecting on growing residential construction. Nevertheless, the ambitious infrastructure plans envisaged by the Trump administration remain on hold, translating into a lackluster increase in cement demand", notes Robert Madeira, CW Group's Managing Director and Head of Research.

In Western Europe, cement demand is expected to increase by close to three percent year-on-year in 2018 to 129.2 million, while maintaining an average growth of 2.2 percent for the period between 2018 and 2023.

In advanced markets such as the US and Western Europe, cement demand has been sustained by a steady growth in the economies – a growth whose speed is likely to ease in the upcoming years.

The cement market of Latin America is expected to display a recovery in 2018, following consecutive years of declining cement demand. During the next five years, growth will likely accelerate as the regional economy recovers. This year, Argentina has outperformed the remaining countries of the region thanks to a dynamic construction sector and large projects such as dams, highways, bridges, and tunnels. To the contrary, Brazil continued immersed in political and social instability.

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For more information, placing an order, or interview inquiries, please contact Mihnea Manea, Media and Market Services Executive, CW Group, by phone at +40 723 281 704, or e-mail at mm@cwgrp.com.

About the Report

CW Group's Global Cement Volume Forecast Report (https://www.cwgrp.com/research/research-products/product/...) (GCVFR) is a twice-yearly update on projections for cement volumes on a national, regional and global level. The forecast provides global and regional outlooks, as well as detailed perspective on 57 of the world's most important countries' cement consumption, production, net trade and cement production capacity. The five-year outlook presented in this benchmark study enables industry professionals to shape their perspective on markets and business priorities.

The Global Cement Volume Forecast Report has two updates a year:
- Extended (October): an extended update (includes briefs on the 57 key markets with principal supply-demand impacting drivers and CW Research's analyst market assessments presenting a detailed numerical worldwide analysis, as well as the regional and global supply-demand model).

- Quantitative update (March): a quantitative update (only includes the numerical sections of the report, not country write-ups).

More information about the report can be found here: https://www.cwgrp.com/research/research-products/product/12-global-cement-volume-forecast-report

About CW Group

The Greenwich (Conn.), USA headquartered CW Group is a leading advisory, research and business intelligence boutique with a global presence and a multi-industry orientation. CW Group is particularly recognized for its sector expertise in heavy-side building materials (cement), light-side building materials, traditional and renewable power & energy, petrochemicals, metals & mining, industrial minerals, industrial manufacturing, bulk cargo & shipping, among others. We have a strong functional capability, grounded in our methodical and quantitative philosophy, including due diligence, sourcing intelligence, feasibility studies and commodity forecasting. www.cwgrp.com