MPA reports sluggish 1Q19 sales of building materials in the UK

MPA reports sluggish 1Q19 sales of building materials in the UK
07 May 2019

Sales volumes of mineral products across markets including aggregates, asphalt, ready-mixed concrete (RMC) and mortar declined in the UK in 1Q19, reported the Mineral Products Association (MPA).

Seasonally-adjusted sales volumes for aggregates had the sharpest decline, down 4.2 per cent compared to the previous quarter, followed by RMC (-4 per cent), mortar (-2.8 per cent) and asphalt (-1.9 per cent).

The MPA figures are in line with reports from the Office for National Statistics, which said that in the three months to February, UK construction output declined 0.6 per cent compared to the previous three months.

In the longer-term, the trends in mineral products sales suggest nonetheless that markets have remained reasonably robust, as volumes across all materials increased moderately in the 12 months to 1Q19, compared to the previous 12 months. Aggregate sales were 5.5 per cent higher in the year to March 2019 compared to the previous year, while asphalt and RMC sales were up 4.3 per cent and 3.9 per cent respectively. Mortar sales by contrast, closely linked to housebuilding, continued to increase strongly, up 16.2 per cent over the same 12 month period but with sales declining in recent quarters.

Nigel Jackson, CEO of the MPA, commented: "The latest MPA figures confirm that construction activity on the ground has flattened out so far this year as the overall UK economy slows down. There is little doubt about the outstanding need for investment in infrastructure and housing, but private investment throughout the economy, including construction, is being impacted by the current political chaos and economic uncertainty. In addition, whilst Government policy on infrastructure and housing has clearly signalled both a need and desire for higher levels of investment, infrastructure in particular has been characterised by over- promising and under-delivery and there is evidence that housing activity has slowed down."

Looking ahead, the latest spring 2019 forecast from the Construction Products Association (CPA) indicates that construction output will be marginally negative this year, before recovering somewhat, albeit slowly, in 2020 and 2021.

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Tagged Under: UK Building Materials sales Volumes