PCA foresees continued US cement industry growth

Cement consumption in the United States continues to grow in line with expectations, PCA chief economist and group vice president, Ed Sullivan, told the PCA Boad of Directors meeting last week.

The PCA says its cement volume forecast remains essentially unchanged since the autumn forecast of 2013. The United States’ cement market is expected to grow 8.2 per cent in 2014, followed by similar rates of growth in 2015 and 2016, said the PCA.

However, minor adjustments have been made regarding the construction sub-sectors. Housing starts, for example, have been trimmed slightly compared to the summer forecast and more emphasis has been place on multifamily starts. Reflecting the trends of the 1H14, cement intensities have been increased compared to the previous forecast. The oil price environment has changed significantly since the summer and these new impacts have been integrated into the forecast projections.

Going forward, Mr Sullivan stated that the underlying economic fundamentals are strengthening and are reflected in the labour market. Sustained gains in monthly job creation in excess of 225,000 net new jobs monthly, in the context of sub-six per cent unemployment translates into more consumer spending power, stronger state and local tax receipts, more favourable returns on investment for commercial building and stronger household formation – all leading to stronger construction spending in 2015.