First publishedin Aggregates Business International
Metso's fabrication factory at Metso Park in Alwar, India. India is due to be the world's fastest growing construction market to 2030.
Demand for construction equipment worldwide is increasing – and that can only be a good thing for aggregates producers.
Rising equipment demand has been noted by a number of leading industry research companies, largely thanks to many countries buoyed by healthy levels of GDP increasing their spending on residential construction and transport infrastructure. Greater foreign investment is also said by some market analysts to be going into emerging markets, such as East Africa.
Off-Highway Research (OHR), a specialist market intelligence and forecasting company, report that sales of construction equipment increased by 16% in 2017, based on preliminary data analysis. Worldwide sales for the same year topped 810,000 units, generating a healthy value of more than €67.9 billion (US$80 billion).
While most major regional construction equipment markets are forecasted to see growth in 2017, China will be the key global driver. OHR notes that crawler excavator sales, for example, doubled in 2017, compared to 2016. Such robust global growth in construction equipment demand goes hand in hand with rising demand for aggregates and other raw materials, used in large and smaller infrastructure projects.
More good news for global construction and quarrying OEMs and the world’s aggregates sector can be found in Global Construction 2030, a key report by Global Construction Perspectives and Oxford Economics. Sponsored by major global OEMs and building materials producers including LafargeHolcim, CRH, CEMEX, Volvo Construction Equipment and Liebherr, the influential study tips the annual world construction market to grow by US$6.3 trillion (61%) to $16.7 trillion by 2030. It predicts that China, the United States and India will lead the way, accounting for 56% of all global growth to 2030. Furthermore, Global Construction 2030 says India’s construction market will grow almost twice as fast as China’s to 2020, and be the world’s fastest growing construction market to 2030.
Readers of Aggregates Business International will also note with interest the key findings of the Freedonia Group’s recent report, Global Construction Machinery Market by Product, 6th Edition. It forecasts that demand for construction equipment in the Asia/Pacific region is set for a double-digit rise until the year 2021, following a decline in the 2011-2016 period. The same report says Asia/Pacific mature and developing markets tipped to do well over the next three years include China, India, Japan, Indonesia, Malaysia, and Australia. Such demand for Asia/Pacific construction equipment is sure to be mirrored by a similar healthy rise in aggregates demand.
Next month I will be attending the bauma CONEXPO AFRICA 2018 exhibition in Johannesburg, South Africa (13-15 March). The 2015 edition of the international trade fair for construction machinery, building material machines, mining machines and construction vehicles attracted 14,311 visitors from over 70 countries, and 616 exhibitors from 42 countries, who displayed the latest technologies and innovations for the African market. It will be fascinating to hear first-hand from attendees and visitors whether they share the leading market research firms’ optimism about the health of the global construction equipment and aggregates sector.
This issue of ABI contains a taster of the first of a series of six top-level management masterclass features on how to avoid the six deadly sins that will stunt your aggregates company’s growth opportunities and destroy its profit margins. The first article by Jon Hill in association with Agg-Intel looks at Product Cost. You can access the full feature and others being published in 2018 covering Pricing; Sales & Operational Planning; Logistics & Distribution; Asset Management; and Knowledge of your Customers, your Market, and your Competitors by going to www.Agg-Intel.com and giving us a few brief contact details.