UK aggregate demand rises
First publishedon www.AggBusiness.com
Demand for aggregates and cement in the UK rose in the first quarter of the year, according to new figures released by the Mineral Products Association. Nonetheless, the association has said it has concerns over market activity in the next 18 months and raised doubts about official construction and GDP forecasts.
Aggregates sales volumes in total were 6% up in the first quarter compared with the first quarter of 2010, with growth evident in sand and gravel rather than crushed rock sales, while cement, ready mixed concrete and asphalt sales were 16%, 19% and 10% up respectively.
The MPA has said that the gains were mainly driven by a shift in sales following poor weather in the final quarter of 2010. Although demand did increase in some areas the association has said it does not expect to see sustained growth until 2013. According to the MPA, recent government figures indicated 0.5% GDP growth in the first quarter compared with the final quarter of 2010, which included a 4.7% reduction in construction. The MPA said that the decline in construction appears odd in context of the data on MPA products used extensively throughout the construction industry.
“While we would not expect a precise correlation between our data and construction output figures, we think that there is sufficient evidence to suggest that the official figures underestimate both the decline in construction activity in the final quarter of 2010 and the recovery of work in the first quarter of 2011,” said MPA chief economist Jerry McLaughlin. “This is an issue of wider significance because if, for example, construction output actually grew rather than fell by 4.7% in the first quarter, the GDP growth would have been a much more positive 1.1%."