Positive Second Quarter for Mineral Products Sales Points to Improvement in Second Half Construction Output
Following the significant improvement in sales volumes of mineral products from mid 2013, the latest MPA sales volumes indicate further improvement in the first half of 2014.
Compared to Q2 last year, crushed rock was the fastest growing market (+9%), whilst both asphalt and sand gravel were 4% higher. Ready mixed concrete sales fell 3.2% over the period, but the decline should be viewed in the context of the very high volumes seen last year and the underlying market trends remain positive.
Whilst last year’s results were stronger than anticipated, the MPA data indicates further growth in 2014 although more modest and stabilising. However even with 3% growth trends markets would not regain pre-recession levels until after 2020.
Provisional GDP figures indicated a fall in construction activity by 0.5% in the second quarter, reducing overall economic output by 0.03%. However, sales of MPA materials should be an early indicator of official construction output data and we can therefore expect construction activity to improve again during the third quarter this year.
MPA Chief Executive, Nigel Jackson, commented: “We are seeing continuing general growth in mineral products markets although, as expected, the speed of underlying growth has slowed from the end of 2013. We believe our figures indicate that the second quarter reduction in construction activity highlighted in the recent GDP announcement is a blip and construction will be positive for the year. If the necessary increase in housing starts can be delivered and promised infrastructure investments are implemented, we should see further improvements in industry markets. But this will of course depend on potential economic headwinds and political uncertainties that lie ahead.
“One issue which MPA members are beginning to raise concerns about, particularly in markets which are seeing strong growth such as sand and gravel aggregates in the South East, is whether the planning system will be able to deliver the permissions required to meet aggregates demands associated with future housing and development activity. This is an issue the industry and national and local government will have to monitor and manage carefully going forward if supply constraints which could impact on growth are to be avoided.”
MINERAL PRODUCTS ASSOCIATION
QUARTERLY CONSTRUCTION MATERIAL TRENDS
The figures give sales trends by volume of material sold for a consistent sample of Mineral Products Association members comprising the following proportions of total GB markets.
Crushed Rock aggregates (approx 80%), Sand Gravelaggregates (approx 80%), Asphalt (approx 80%), Ready-mixed concrete(approx 60%), Cement (approx 85%)
RESULTS
% change over same period of previous year
2013 QTR 1
2013 QTR 2
2013 QTR 3
2013
QTR 4
2013
YEAR
2014
QTR 1
2014
QTR2
Crushed Rock
-3%
15%
7%
10%
7%
18%
9%
Sand Gravel
-10%
11%
12%
18%
8%
15%
4%
Asphalt
-18%
9%
11%
14%
4%
17%
4%
Ready mixedConcrete
-2%
23%
12%
12%
11%
4%
-3%
Cement*
na**
na**
na**
na**
6.9%
na**
na**
