Demand for cement in China to rise

Demand for cement in China to rise
Published: 28 January 2009

Demand for cement in China is forecast to rise by +6% annually through 2012 to 1.8bnt, according to Cement in China, the latest study by US-based research company The Freedonia Group.

Growth, said the study, will be driven by rising, but decelerating, construction expenditures in China. Further advances in cement manufacturing technology will also help stimulate sales by improving the quality of the product, it added.

Blended cements will account for about 90% of total sales in 2012, reflecting the versatility of these types across a range of construction applications, as well as their performance and/or price benefits over competitive cements.

Non-residential building construction will continue to represent the largest end use for cement, benefiting from ongoing industrialization in China. Non-residential building cement consumption will also be boosted by the construction of new manufacturing facilities as the Chinese industrial sector focuses on more value added goods.

However, demand for cement in non-building construction will outpace other construction categories, rising +7.3% annually to 544 million tonnes in 2012.

In the short term, demand for cement used in infrastructure expansion projects will benefit from government spending packages designed to offset the effects of the global economic downturn. In the longer term, a number of large infrastructure projects and other government initiatives to address imbalances in development between urban and rural areas will boost non-building cement consumption.

Construction contractors will continue to be the largest market for cement, accounting for 32% of total demand in 2012, said the study. However, the ready-mix concrete market will see the strongest growth, rising +9.8% per annum through 2012 to 383Mt.

Gains will benefit from government regulations banning on-site concrete and mortar mixing. Demand for cement used in concrete products is expected to grow +5.4% annually through 2012 to 513Mt, driven by the growing popularity of precast concrete with many construction contractors. In addition, the phase out of clay bricks will boost demand for concrete blocks.