Italian cement slips in 2023 with moderate 2024 forecast

Italian cement output expanded eight per cent YoY in December 2023, according to the Italian concrete association, Federbeton. This was largely driven by robust demand from local public sector works, which totaled EUR18.1bn in the year to December.

However, cement output contracted two per cent for 2023 as a whole, weighed down by sluggish activity in the construction sector. Data from the national statistics provider, ISTAT, shows construction output contracted 0.1 per cent for the year.

Grey cement imports increased by 52 per cent to 188,088t in November 2023, with a total CIF value of EUR16.4m or EUR87/t as values per tonne held steady. For the first 11 months of the year, import volumes were up 52 per cent.

Grey cement exports rose 32 per cent to 126,980t in November 20223, with a total FOB value of EUR12.9m or EUR102/t, up from EUR101/t in October. In the 11M23 export volumes increased by 17 per cent.

Outlook
The outlook for 2024 shows some modest improvement. The HCOB Italy Construction Purchasing Managers’ Index (PMI), which measures confidence in the construction sector, recorded its fourth consecutive month of expansion for January 2024, coming in at 51.6 down from December’s 20-month high of 55.2.

Local authority demand, which accounts for roughly 45 per cent of Italian cement consumption, is also expected to be sustained, with spending up a massive 56 per cent YoY in first two months of 2024 to EUR2.6bn.  

Nonetheless, downside risks remain with economic growth of just 0.7 per cent forecast for 2024 according to the latest IMF projections, while oversupply and high energy costs will remain important drags on the cement industry.