PCA: demand growth in 2014 and beyond

Cement consumption is expected to grow in the United States through 2014, followed by additional gains in 2015 and 2016, according to a recent Portland Cement Association (PCA) economic forecast.

Consistent with a report earlier this spring, cement consumption will increase 7.9 per cent this year compared to 2013 levels. The forecast indicates considerable evidence that the economy's growth path has strengthened from gains in the labor market, low consumer debt, and increased consumer wealth.

"Through July, year-to-date cement consumption is up 8.4 per cent" PCA Chief Economist and Group Vice President Edward Sullivan said. "The pace of cement consumption has clearly strengthened from earlier in the year."

PCA expects real gross domestic product (GDP) growth to average in excess of three percent annually during the remainder of the forecast horizon. With stronger economic progress, residential and nonresidential construction should strengthen, state fiscal conditions improve and public construction will eventually become a contributor to increases in cement consumption. PCA forecast risks are believed to be on the upside.

"It appears that the fundamentals are in place to support sustained gains in cement sales activity," said Sullivan. "For example, although total home sales are expected to remain flat in 2014, we see a 13 per cent acceleration next year."