Demand for Heavy Side Building Materials Falls

DEMAND FOR HEAVY side building materials, such as mortar, aggregates and asphalt, fell in 2019 according to trade body the Mineral Products Association.

According to the association’s data, demand was weak throughout the year. With orders failing to pick up again in the final quarter of the year, sales volumes for these materials were lower in 2019 compared to 2018, down 3.9% for ready-mixed concrete, -2.2% for aggregates, -1.7% for mortar and -0.8% for asphalt

Declining markets provide tangible evidence of weakening UK construction activity, corroborating a range of business surveys.

Housebuilding

Sales of mortar, the majority of which is used in housebuilding, declined by 8.6% in the final quarter of 2019 compared to the previous quarter, the sharpest quarterly fall since mid-2012.

Mortar sales volumes have now declined in six of the last eight quarters, a clear indication of housebuilding activity running out of steam.

Building materials such as aggregates and ready-mixed concrete are used in most construction projects, mainly early in a project’s timeline, providing the foundation and structure to houses, retail and office blocks, hospitals, schools, railways and roads.

Falling demand for these products indicates that ongoing construction work most likely focuses on existing and finishing sites rather than new ones, and a further slowdown in activity cannot be ruled out over the next few months.

Ongoing uncertainty

“The prospects for heavy side building materials markets in 2020 remain weak”, explained Aurelie Delannoy, Director of Economic Affairs at the Mineral Products Association.

“All indicators suggest that UK construction and its supply chain will have to wait for 2021 for growth to slowly resume, provided work in the roads, rail and energy sectors accelerate as planned. However, uncertainty lingers on unnecessarily for key infrastructure projects such as the long-awaited HS2, for which the industry has called on the Prime Minister to make a firm and swift decision and give the mineral products industry more confidence to invest and, in turn, boost growth.

“Meanwhile, the economic and political uncertainty generated by the Brexit process have stifled private investment in the sector in the past three years.

“Despite the recent breakthrough in the negotiations of the Withdrawal Agreement, this may continue as the negotiations about future trade unfold and the risk of a ‘No Deal’ remains to the end of 2020.”