First publishedon www.AggBusiness.com
A decrease in aggregates markets during the recession has resulted in more than 100 pits and quarries closing over the last two years.
This is one of the conclusions of marketing consultant BDS Marketing Research
’s latest annual report on the sector.
The company has identified 35 sites that have closed over the last year, in addition to more than 65 sites closed in the year before.
Volumes improved by just 1% in 2010. This appears to have stemmed some of the closures, says the report.
“Some will have closed through completion of reserves, but many closed due to the need to reduce losses.
“The last year has been busy in terms of company development. Tarmac
announced a merger of their operations. Breedon
has recently acquired C&G Concrete
,” points out the report.
BDS has also listed another half a dozen smaller acquisitions and identified three companies that have gone into administration.
The annual BDS report, ‘Estimated Outputs of Pits, Quarries and Marine Wharves in Great Britain’ shows company market shares at a local, regional and national basis.
These are derived from output estimates of individual pits and quarries. The survey is used by existing companies to compare their market share with their competitors, equipment suppliers and others considering investment in the industry.
“This report is the only one of its kind that estimates shares and volumes for all sites,” says BDS Marketing.
“Tarmac continues as the largest aggregates company, followed by Aggregate Industries
. The top five companies also comprise Hanson
and Lafarge. Between them, these businesses accounted for 71% of the market in 2010. Yet there remain 230 other companies in the industry.”
BDS is not optimistic about short-term prospects. In the current year, it expects volumes will be slightly down on 2010.
In 2012, the consultancy is forecasting a fall in the market of 4% due to the completion of a number of road projects and a general cut back in public expenditure.
The market is currently being helped by a number of commercial schemes such as hotels, being built before the 2012 London Olympics, but this work will also tail off next year.
However, it expects the market to pick up from 2013. By then, most of the public expenditure cuts will have worked through the system, whils the private sector will be growing more strongly.
A number of infrastructure projects are planned, including power stations, the Forth Bridge [across the Firth of Forth, near Edinburgh, Scotland] and those relating to the 2014 Commonwealth Games.
The market in 2013 will be compared with a fairly benign 2012. The world economy will continue to be buffeted by financial difficulties in countries such as Italy and Spain. While this will be headline news for some time to come, the effect on UK aggregates markets is not expected to be significant, BDS believes.
Further details of the report are available by contacting Julian Clapp at BDS:
+44 (0) 1761 433035