Hanson Cement comment: Q4 2015

Keith Ellis, Commercial Director Hanson Cement is BMBI’s Expert for Cement & Aggregates.

The cement and aggregates markets have grown strongly over the last few years, driven principally by an upturn in private housing starts and major infrastructure projects such as London’s Crossrail. We expect this growth to continue in the short to mid-term, led by further expansion in the commercial, industrial and infrastructure sectors and continuing, though slower growth in private housing and repair maintenance and improvement.

Compared to the rest of Europe, per capita sales of both aggregates and cement remain relatively low, at about 32% and 48% respectively behind the rest of the EU. So there is considerable scope for market growth in the UK.

Bulk cement accounts for around 82% of sales. It is used in readymixed concrete, factory produced mortars, precast concrete, building chemicals and major civil engineering projects. Commercial, infrastructure and housing markets are the main drivers. Packed cement accounts for the remaining 18%, most of which is supplied to builder’s merchants and DIY sheds for the repair, maintenance and improvement markets.

Bulk cement sales are expected to grow faster than packed cement in the next few years, fuelled by the infrastructure, commercial and private housing sectors, particularly in the South and South East of England, which accounts for much of the current growth in construction activity.

The demand for weatherproof packaging in packed cement and packed cementitious product markets continues to grow, despite supply shortages last year. Merchants and builders like the advantages of this type of packaging. It’s tear resistant, rain proof, and less product is wasted. Most importantly, it can be stored outside in the merchant’s yard, so space inside can be used for more valuable products and a price premium can be achieved. Nearly half of all packed cements purchased is now supplied packaged in plastic or some other form of weatherproof packaging. The use of weatherproof packaging will continue to grow as manufacturing capacity improves.

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Launched in 2015, the award winning monthly Builders Merchant Building Index (BMBI) report is the only reliable measure of repair, maintenance & improvement (RMI) activity in the UK. Filling an important gap, it can be widely used in construction, and by economists, Government, national media, commentators and influencers outside the industry.

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