RSSCW Research has released its 1H2015 Quantitative Update to the benchmark Global Cement Volume Forecast Report (GCVFR), the advisory and research boutique’s twice-yearly outlook for worldwide cement market volumes.
The 1H2015 revision of the report forecasts a 2.9% in the pace of global cement demand growth in 2015, up to 4.3 billion tons, following a slower-than-expected increase of 2.6%, up to 4.1 billion tons in 2014.
"We are seeing the global cement market making sure steps towards a more balanced future, but that is not to say that the sector is safe from meeting the volatilities it has experienced in the past. Political instability and geo-political tensions may once again take their toll on the cement market, preventing it from performing to the rates we have anticipated in this forecast,” said Robert Madeira,
According to the 1H2015 Quantitative Update to GCVFR, the concerns that prevented the global market from reaching its anticipated potential have been the Russia-Ukraine crisis followed by the Western embargo on Russia; the worsening situation in the Levant region; the Ebola epidemic in West Africa, and the militant unrest in northern Nigeria.
The report’s major negative revision for 2015 is for Eastern Europe, driven by declines in Ukraine and Russia. Brazil and Nigeria have also been affected by the decreasing export prices of commodities, and notable forecast revisions have also been made for Iraq and Chile.
Last year’s good news came from the Chinese market, which counter-balanced some of the weakness in key growth areas such as the rest of Asia and the Middle East.
According to the CW Research report update, China’s growth outlook, although slower, is set to remain positive, but with a material downside risk, which could even become negative in 2015, with a compound annual growth rate (CAGR) of somewhat less than 2% from 2014-2019.
Future growth prospects still look promising for Asian countries such as India, Vietnam, Indonesia and Thailand, where construction spending is expected to grow at above the regional average of 4.4% over the next five years. India has a particularly positive outlook as it recently elected a new government which is expected to speed up development projects.
Another case of solid growth is the United States, which has shown clear signs of recovery in 2014, with an economic growth of 2.2% in 2014 and an expected 3.1% in 2015, according to the CW Research update.
“North America is leading a demand revival at a time when other major advanced economies are mired in economic paralysis,” says Prashant Singh, associate director with the CW advisory team.
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