Cement consumption expected to decline in the West

After a flat market in 2020, cement consumption in the U.S. Pacific region is expected to grow slightly by 0.9% in 2021according to the Portland Cement Association Market Intelligence Group.

The Pacific Region was among the hardest hit by the impacts of COVID-19 with Washington and the San Francisco Bay Area not exempting all forms of construction in the spring according to the PCA cement consumption and real put-in-place construction spending forecast issued earlier this month.

California finished the year with growth, while Washington – despite strong gains in the second half of the year – saw a decline in cement consumption in 2020.

Oregon had recorded double-digit gains in cement consumption in four of the five years going into 2020 but saw a steep decline as cement intensities normalized. Near-term growth in the region is projected to be driven primarily by residential construction.

Cement consumption for the Mountain region is expected to decline, despite the fact that the region led the U.S. in growth (around 10%) in 2020.

The region has healthy underlying economic fundamentals and favourable demographic trends. Utah and Idaho have seen some of the quickest rebounds in employment since the beginning of the pandemic, with each state in excess of 92% of total jobs recovered.

There are areas of concern, however, with Nevada’s high exposure to leisure and hospitality and New Mexico and Wyoming’s reliance on oil.

The PCA Market Intelligence expects the region to decline 1.3% in 2021 as the commercial and public sectors are forecasted to turn negative, while the robust housing market continues to grow.

Other parts of the country will show mixed results. Cement consumption in the South Atlantic Census division ends in the positive territory amid the COVID-19 crisis thanks to positive in-migration fueling housing constructions. Riding on the back of this trend, PCA Market Intelligence expects cement consumption to grow by 3.0% in 2021.

The Northeast has been hit hard by COVID-19, leading to cement consumption declining by a projected 0.6% in 2020 and PCA Market Intelligence projects further decline in 2021 by nearly 1%.

After a slight 2020 decline in the West South Central Census division, PCA Market Intelligence expects cement consumption to grow 2.9% in 2021.

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