Despite tough Chinese economy, country still burns with construction and quarrying ambition

It’s a fact that China's growth has slowed to its lowest rate in a quarter of a century.

The world's second-largest economy grew by 6.8% in the October-December 2015 quarter, down from the previous quarter's 6.9%.

However, leading US-based industry research firm the 969 Freedonia Group still believes more than two-thirds of all additional construction equipment demand generated from 2014-2019 – rising 3.9% to US$218 billion compared to the period 2008-13 - will be attributable to China.

It remains a key battleground for leading global construction and quarrying equipment OEMs, and given that it’s a bumper 386 bauma year – with bauma Munich 11-17 April and 7556 bauma China 22-25 November – we can also expect leading Chinese manufacturers such as 4334 Sany, 7340 XCMG, 441 LiuGong and 7995 Zoomlion to unveil many new products and state-of-the-art technology to customers at home and overseas.

The truly global ambition of Chinese manufacturers is very apparent in Zoomlion’s unsolicited $3.28 billion bid to acquire 3652 Terex, which remains in the process of merging with Finnish company Konecranes. As this issue of ABI went to press, we were still awaiting further developments of this major story.

Switching to the Middle East, my last ABI Comment piece highlighted how the Middle East remains a bright spot within the tough global market. Well, now we potentially have another in the form of Iran – fresh from last month’s lifting of United Nations and European Union agreed to lift nuclear-related sanctions in exchange for Iran curbing its nuclear program.

According to MEED Insight, a Middle East research and analysis service, the lifting of economic sanctions on Iran could unlock project investments worth up to US$200 billion. Of these, less than $3 billion-worth are under bid, close to $12 billion are undergoing pre-qualification and another $12.2 billion are under design.

Countries are said by MEED Insight to be stepping up their drive to win business in the Middle East's second-largest economy. The lifting of economic sanctions unleashes significant spending on the oil and gas industry as well as other sectors of the economy, which have been starved of investment and access to state-of-the-art technology for years.

It will be fascinating to see if construction and quarrying equipment manufacturers can benefit from such a highly lucrative, yet previously cut off, market.

I hope there will be lots that our Asia, Africa and Middle East-based quarry operators and manager readers can take from my coverage of the 10th annual 460 Sandvik Construction-3740 Dyno Nobel Quarry Academy held late last year in San Antonio, Texas.

Key to the three-day event was how quarry operators can remain successful in the ‘New Normal’ – the global market following the 2008 global economic crisis. Creating a strong Value Management Chain - covering Planning, Drilling, Blasting, Load & Haul, Crushing, and Screening & Sizing – was said to be key, with various highly experienced professionals from Sandvik Construction, Dyno Nobel and 473 Volvo Construction Equipment, relaying practical examples of it to Conference attendees.

The final Conference day included an afternoon visit to 643 Cemex’s Balcones Quarry near San Antonio – the largest working quarry in the United States. It was the ideal way to see fist-hand the best practice articulated over the previous two-and-a-half days.

This issue of ABI also includes the first of our Agg-intel branded features on the key issues within the modern aggregates industry. Hugo Pettingell, a quarry process specialist with many years of experience working with multinational companies worldwide, gives his views on how to meet the challenge of a maturing aggregates market.