Global cement consumption is projected to increase more than 1 percent year-on-year in 2021, following a recovery in several major cement markets from Covid-19, as vaccinations advance worldwide and governments increase spending to stimulate economies, according to CW Research's 2H2021 update of the Global Cement Volume Forecast Report (GCVFR).
CW Research revised its 1H2021 forecast upwards as the global economy is experiencing a recovery in 2021 after the unprecedented contraction in 2020 caused by the pandemic. Nevertheless, cement demand is expected to have a smaller growth in comparison to the 1H2020 update of the GCVFR, when the forecast was a growth of 2 percent this year.
According to the IMF’s October update, global economic output is expected to grow by almost 6 percent in 2021, compared to a decline of about 3 percent in 2020. Supply chain disruptions and worsening pandemic dynamics in some countries are expected to be offset by a stronger recovery of commodity-export-focused developing economies.
“New urban centers, including NEOM City in Saudi Arabia to Indonesia’s new capital envisioned for East Kalimantan, show that the focus of a new paradigm in construction and infrastructure growth remains the path forward. Demand is expected to recover from a deep decline in 2020 and return to robust growth, boosted by Asia-ex China markets including India, the Philippines, Indonesia, and Bangladesh,” states Carolina Pereira, Director at CW Group.
Global ex-China markets to post growth in 2021
In 2021, demand across cement markets is expected to grow, with the only difference being the magnitude of the recovery. Asia ex-China is likely to lead cement consumption growth by almost 7 percent year-on-year, while demand in the Middle East is estimated to increase by more than 2 percent on a yearly basis.
Meanwhile, Western Europe is expected to see an overall cement demand growth of almost 3 percent year-on-year, as a consequence of the economic recovery across major countries, after the deep decline experienced in the region in 2020.
Global cement demand to pick up the pace by 2026
Global cement demand is expected to grow on average at less than 2 percent by 2026F, capped by China’s efforts to reduce pollution and carbon emission in addition to a much-needed rationalization of the real estate market which is expected to take a toll on industrial output, including cement production.
However, growth prospects remain brighter than the consumption growth witnessed in the 2016-2021 period when consumption increase was estimated at 1 percent on average each year.
India’s cement demand to witness a robust recovery in 2021
Out of the 57 countries analyzed in the VFR 2H2021 update, India is expected to grow at the highest pace in 2021 among the largest markets, followed by Bangladesh, Nigeria, and Saudi Arabia. Smaller markets including Peru and Kenya are also expected to post robust growth during the forecast period.
In India, cement demand is expected to witness a robust recovery in 2021, growing more than 10 percent year on year. Per capita consumption is also expected to rise by 2026 at a CAGR of almost 6 percent.
The 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 countries’ 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.