Cement consumption expected to exceed earlier expectations

The Portland Cement Association (PCA) has nearly doubled its expected 2012 cement consumption figures in a revised forecast that reflects the favorable weather much of the United States has had, gains in residential and nonresidential construction activity, and gains in cement intensities.

PCA revised its spring forecast upward, anticipating a 6.9 percent increase in 2012 from 2011 levels, followed by a 5.8 percent jump in 2013 and a 10.9 percent increase in 2014.

“In addition to great construction weather during the first half of the year, real put-in-place construction activity is up 4.2 percent compared to 2011 levels,” says Ed Sullivan, PCA chief economist. “We expect to see a 5.5 percent gain on real construction activity this year after seven consecutive years of decline.”

Beyond 2012, Sullivan says the near-term economic outlook is uncertain. The uncertainty will inhibit stronger growth conditions from materializing, he says.

“If Congress fails to address the fiscal cliff issue during the first or second quarter of 2013, there is the potential for severe adverse economic consequences that could slow the recovery process, potentially leading to a severe decline in 2013 cement consumption,” Sullivan says. “PCA’s baseline projections assume a rational Congress that will recognize these risks and take action to minimize restraints on economic growth.”