Weak first quarter for Spanish cement

Weak first quarter for Spanish cement
02 May 2024

Cement consumption in Spain dropped a notable 23.6 per cent YoY in March 2024, to 1.102Mt, down from 1.144Mt in March 2023, according to the Spanish cement association, Infocemento. Infocemento notes two downward drags on the sector during the month: “On the one hand, the calendar effect, having more festive holidays than previous years due to the celebration of Holy Week in March instead of April; and on the other, the rain effect, since last month's precipitation doubled the usual, with March being one of the most rainy in the last few decades.”
Meanwhile, exports were down 32.4 per cent YoY or 178,953t less than a year earlier, coming in at 373,047t.
January-March 2024
Cement consumption dropped 10 per cent YoY in the first quarter of 2024, amounting to 3.315Mt, down from 3.682Mt in the same period a year earlier.
Exports fell by 25.1 per cent YoY in the first three months of the year, “standing in the vicinity of one million tonnes”, according to Infocemento.
Infocemento is forecasting a “timid recovery throughout the second half, as long as the international and local situation remains stable”. Continued gradual improvement in the Spanish construction sector will help lift cement demand as 2024 progresses.
Spanish GDP grew faster than analysts had expected in the 1Q24, coming in at 0.7 per cent QoQ, in line with the 4Q23 growth. Construction recorded a robust two per cent QoQ and 3.6 per cent YoY expansion in the 1Q24.
Data from the Ministry of Transport and Sustainable Mobility show new construction permits rose 8.5 per cent YoY in the 2M24. This follows a six per cent YoY contraction for 2023 as whole. Residential permits were up 8.6 per cent YoY in the January-February period and non-residential permits up 7.8 per cent YoY.
Meanwhile, the monthly construction sector survey by the Ministry of industry and Tourism shows a further uptick in confidence for the sector in April, with improved expectations for new orders and employment.
After growing 2.5 per cent in 2023, Spain’s economy is forecast to expand 1.9 per cent YoY this year, before accelerating to 2.1 per cent in 2025, according to the International Monetary Fund. Cooling inflationary pressures and lower interest rates will help support growth.

Published under Cement News