Spain registers further market contraction

Spain registers further market contraction
17 July 2013

The Spanish cement market registered a 24 per cent YoY drop in the first half of 2013 and the decline is expected to continue through the remainder of the year.

In the first six months of 2013 domestic cement sales were 5,472,933t, latest data from local cement association Oficemen shows. On the supply side, Spain produced 6,459,917t of cement, representing a fall of 22.2 per cent.

In June 2013 alone, Spanish consumption fell a further 23 per cent YoY to 972,421t in the same month of the previous year. Production decreased by nearly 18 per cent to 1,232,226t.

For full year 2013, Oficemen expects domestic demand to contract by 21 per cent to 10Mt. Per capita consumption is predicted to be around 230kg, a level not seen in 50 years.

This year, Spain has seen the lowest ratio of public investment in civil works to GDP in the EU, according to Eurostat. "We hope that the moderate relaxation of the deficit targets allow different public administrations to include investment funds in their budgets. As a country we can not afford further cripple public works because we mortgage our future,"says Isidoro Miranda, Oficemen president. "In addition to deficiencies in sanitation and water supply, we have to remember that the maintenance of infrastructure is essential to preserve its quality and if we want to keep the tourist demand, we need new infrastructure investment and sustainable buildings," he adds.

Regarding the building sector, Miranda asked the government for measures to promote credit lines. "Construction is the sector that can quickly boost the economy with materials and local employment. And this requires that credit flows. Improving access to finance and reviving public works, employment and economic trends, and therefore the consumption of cement, may give a change in signs.”

For 2014, the association does not see any sign of recovery although the pace of contraction is expected to be less than in the 2012-13 period.

Published under Cement News