Cement Consumption Forecast Lowered
Will Still Grow Over Next Two Years
According to the Portland Cement Association's latest projection, U. S. cement consumption will be down slightly from the growth projections made last fall. PCA is now forecasting 3.4 percent growth in 2016 compared to its first forecast of 5 percent. Projections for 2017 were also adjusted down to a growth rate of 4.3 percent, compared to the earlier 5.7 percent growth forecast.
A statement from the association contends that the new numbers reflect deterioration in global growth conditions; an even weaker U.S. Energy Information Administration projection for oil prices; a tightening in U. S. monetary policy; further strengthening of the dollar; slower employment growth; and a slower path of recovery in cement intensities.
On the plus side, the new forecast takes into account the implementation of the recently passed multi-year highway bill: Fixing America's Surface Transportation (FAST) Act. These many factors are being held responsible by the PCA for the 160 basis point reduction in 2016 growth. Many of these factors are projected to be in play for 2017 and create a 140 basis point reduction from the previous forecast, and remain in play until the global headwinds ebb - beginning in 2018.
The statement notes that there is a mix of risks to the forecast, but that generally the risks have shifted to the downside.