Asia ex-China markets to drive growth in global cement demand by 2025

Asia ex-China markets are expected to support global cement demand for the forecast period 2020-2025. The region is expected to retain its position as the fastest growing region, at CAGR of over 4 percent, according to the CW Research's 2H2020 update of the Global Cement Volume Forecast Report.

Despite an extremely challenging macroeconomic scenario as direct consequence of the pandemic, certain markets showed unexpected resilience, including Brazil and Saudi Arabia. On the other hand, India, the world second largest cement market is expected to suffer an unprecedent decline of 20 percent year-on-year. Other fast-growing markets in the Asia ex-China region, including Bangladesh, the Philippines and Vietnam are expected to witness slower growth.

"The evolution of cement demand is marked by wide discrepancies across regions. However, in 2020, the only difference is the magnitude of the contraction in demand, with the singular exception of China. North America and Western Europe will experience a significant demand decline, of over 5 percent, in 2020, while other major markets, including Brazil are unexpectedly seeing an improvement of 4 percent in this year marked by the pandemic", states Carolina Pereira, CW Group's Manager, Advisory & Research.

Demand to retain growth trajectory in North and Latin America in the forecast period

Cement consumption in the United States is forecast to grow at a CAGR of more than 1 percent from 2020 to 2025, from an estimated 95 million tons. Demand in North America is likely to suffer a decline of over 6 percent this year and it is projected to retain a downward trend in 2021, although a rebound is expected in the 2022-2025 period.

In Latin America, CW Research expects demand to contract by a significant 6 percent, despite growth in Brazil. Argentina remains in a dire situation due to hyperinflation, and the once promising cement market is projected to be hit hard by the pandemic, resulting in a significant contraction of 18 percent in 2020.

Africa and Middle East to witness a higher cement demand

Despite a forecasted decline for cement demand in Africa, by around 4 percent, in 2020, consumption will likely remain on track with a CAGR of almost 2 percent between 2020-25. Two of the major cement consumers in the region, Egypt and Nigeria, are in a demand recovery trajectory.

The Egyptian government has continued to maintain its commitment to investment in infrastructure, including the completion of the administrative capital by June 2021 despite the delays caused by the imposition of lockdowns halting construction activity. Meanwhile, in Nigeria, cement demand is expected to be negatively impacted due to present low global crude prices. The outlook over the forecast period, however, remains positive due to the expectation of a recovery in crude prices in 2021 as well as sustained infrastructure requirements within the country.

In the Middle East, lower oil revenues continue to cap the regional capacity to invest in new infrastructure. The two heavyweight cement consumers in the region, Iran and Saudi Arabia, will likely report a divergent trajectory, with Iran expected to see a demand contraction of more than 6 percent and Saudi Arabia forecast to grow at 10 percent year-on-year in 2020, as the government has continued to focus on infrastructure spending.

CW Group's Global Cement Volume Forecast Report (GCVFR) is a twice-yearly update on projections for cement volumes on a national, regional and global level. The forecast provides global and regional outlooks, as well as detailed perspectives on 57 of the world's most important countriesÔÇÖ cement consumption, production, net trade and cement production capacity. The five-year outlook presented in this benchmark study enables industry professionals to shape their perspective on markets and business priorities.

Find out more about the report here