Surging mortar sales suggest that housebuilding in Great Britain remained buoyant in 2018.
That is one of the indications of the latest data from the
Year-on-year volumes increased by 14.3%, despite tailing off in Q4 with a 1% decline. The majority of mortar sales take place within six months of housebuilding projects starting, with increased volumes indicating that new starts were positive during 2018.
The MPA says this trend suggests more cause for optimism than other market indicators such as ONS data on brick deliveries, where a lacklustre 1.6% increase in the 12 months to Q3 2018 may be attributable to previous stockpiling and import volumes.
Beyond housebuilding, the wider picture of construction demand for essential mineral products is more muted, reflecting an industry still waiting for major projects to break through Brexit uncertainty and become shovel ready.
Ready mixed concrete sales volumes fell 1.6% nationally in 2018, weighed down by reduced demand in London, where sales declined by 4.8%. The ubiquitous material is a bellwether for general construction activity, with weak housebuilding and commercial construction markets in the capital contributing to the drop in sales.
However, while significant projects such as the Thames Tideway Tunnel may sustain demand for ready mixed concrete in the coming months, the MPA says the timing of any uptick remains unclear.
The MPA’s analysis shows that the southern regions of England and Wales led asphalt sales in 2018, indicative of roadbuilding and maintenance activity, contributing to a 0.7 per cent growth nationally and offsetting declines in most other regions.
This modest growth is likely to reflect greater local authority activity, which may continue to grow in Q1 2019 following the Chancellor’s Budget announcement of £420m of additional funding to tackle potholes in the current financial year.
Many major projects slated for the strategic network as part of Highways England’s Roads Investment Strategy 1, have yet to make an impact on the ground as the programme is heavily backloaded to 2019, 2020 and 2021.
Aurelie Delannoy, director of economic affairs at the MPA, commented: “Like many sectors, construction is awaiting the outcome of Brexit negotiations, but our data shows that Great Britain is still building despite the uncertainty.
“In particular, strong mortar sales indicate continuing new housebuilding projects in 2018. Our analysis, based on actual sales and on-the-ground activity rather than sentiment, suggests this has been higher than forecasted by other metrics."
She added that elsewhere, the picture for the industry is more muted with the industry waiting for several major infrastructure schemes to make the leap from the planning phase to the construction site.
"Policymakers and clients need to be mindful that the critical mineral resources that underpin our built environment don’t flow from a tap, and preparations to ensure a ready supply need to begin early in a project’s lifecycle,” said Delannoy.
The MPA is the industry voice for mineral products and represents over 520 companies across the £20bn sector. Its sales data is seasonally adjusted and drawn from the MPA membership which covers 100% of GB cement production, 90% of aggregates, 95% of asphalt and over 70% of ready mixed and precast concrete production.
