Cement ex-works prices in South America to rise while Europe witnesses a decline in 4Q2020

In the fourth quarter of 2020, on a yearly basis, cement ex-works prices are estimated to range from a decrease of more than 6 percent in Eastern Europe and CIS to an increase of almost 7 percent in South America, according to the 4Q2020 update of CW Research's Global Cement Trade Price Report.

On a quarterly basis, in Sub-Saharan Africa, the average cement ex-works price is set to record a quarterly increase of around 7 percent, a result of the extraordinary recovery of South Africa's construction sector. In the third quarter of the year, it grew by more than 71.1 percent, as pandemic-related restrictions were eased, which made it possible for construction sites to resume operations.

ÔÇ£In South America, improvements in Brazil and Colombia prices are expected to drive an increase in South American prices to more than USD 76 per ton in Q4. This trend is expected to continue in 1Q21. On the other hand, ex-works prices in Eastern Europe are forecast to suffer a major decline driven by Russia, where prices are estimated to decline by almost 13 percent, as the construction sector continues to be affected by reduced government spending due to sustained lower oil pricesÔÇØ, assessed Juliana Vieira, Business Analyst at CW Group.

The pandemic weights on European and Asian markets

In Western Europe and the Mediterranean Basin, ex-works prices are predicted to weaken quarter-on-quarter by almost 1 percent, due to a decline in Spain, Italy, France and Germany as these countries continue to struggle with the impact of the Covid-19 pandemic.

In Asia-Pacific ex-China, ex-works prices are also predicted to fall slightly by less than 1 percent quarter-on-quarter, as key countries, including South Korea, continued to suffer with the effects of the pandemic during the fourth quarter of 2020.

North American prices estimated to increase in the 4Q

The average selling price of cement in North America is expected to have a slight increase quarter-on-quarter in the fourth quarter of 2020, reaching USD 103 per ton. Compared to the same period last year, ex-works prices are estimated to increase 2.1 percent.

In the US, in Q4 2020, cement ex-works prices are forecast to increase more than 3 percent year-on-year, as the value of construction output increased almost 4 percent year-on-year in October alone. In addition, housing starts showed a strong rise of 14 percent in October 2020, compared to October 2019.

Ex-works prices in 1Q2021 to witness regional discrepancies

Ex-works cement prices are expected to increase quarter-on-quarter in the first quarter of 2021 in China, South America and South Asia, ranging from 1 to 2 percent. In the Mediterranean Basin, major markets including Italy and Spain are expected to continue witnessing a decline in prices.

In the Middle East, ex-works prices are expected to remain stable, benefiting from minor price increases in Saudi Arabia and the UAE.

The Global Cement Trade Price Report is CW Research's benchmark price assessment for monthly gray cement, white cement, clinker and granulated blast furnace slag prices and volumes. The 150+ page report, published on a quarterly basis, serves as the industry go-to source for monthly price data for over 70 individual markets worldwide, including multiple cornerstone data series: import, export, ex-works and market prices.

Find out more about the report here.