As we enter a new year, all eyes are on what the future holds for the cement industry following a mixed performance in 2023 that saw many key markets underperform.
Global cement demand fell by 1.2 per cent in 2023 to 4025Mt, following a 5.1 per cent decline in 2022, according to The Global Cement Report, 15th Edition (GCR15). Of course, China continues to dominate, having consumed 2119Mt in 2022, accounting for 52 per cent of demand. However, demand here has now plateaued, according to GCR15, which reports a 10.4 per cent decline in 2022, followed by further falls of 4.1 and 1.5 per cent in 2023 and 2024, respectively, driven by the country’s ongoing real estate crisis.
Putting China to one side, global cement demand growth has cooled substantially following the exceptional pandemic era expansion of 8.7 per cent in 2021, slowing to 1.4 and 1.9 per cent in 2022 and 2023, respectively.
India, the second-largest consumer with 387.335Mt in 2022, expanded by 8.1 per cent in 2023, fuelled by urbanisation and industrialisation trends that will continue to support both consumption and a high pace of capacity expansion for the foreseeable future.
Demand in the US, the world’s third-largest consumer, weakened by an estimated 2.7 per cent in 2023 to 108Mt, as interest rates posed a challenge for homebuilders and homebuyers alike. However, a modest rebound and return to growth is forecast for 2024.
The substantial global capacity surplus remains a key issue for the cement industry. For countries like China, which is now scaling down its industry, state-sponsored capacity rationalisation is anticipated to accelerate in the coming year.
Elsewhere, capacity surpluses will drive trade activity where feasible. The global trade in cement and clinker advanced from 176Mt in 2012 to 226Mt by 2022, equivalent to 5.5 per cent of global consumption, according to GCR15. In 2023 worldwide cement and clinker exports were dominated by Vietnam, Turkey and Iran. Meanwhile, cement and clinker imports were led by the USA, Bangladesh and The Philippines. Trade volumes are forecast to remain elevated at an estimated 225.9Mt in 2024.
Wherever you are in the world, sustainability will be a key theme in 2024, a year in which the world’s first industrial scale cement carbon capture project is due to come on-stream at Heidelberg Materials’ Brevik plant in Norway. Furthermore, the pipeline for innovative decarbonisation projects, covering every aspect of cement and concrete production, continues to expand at an astonishing pace. ICR looks forward to sharing the most promising examples with you throughout the year.
