The industry will return to growth due to recovering domestic construction markets.
Los Angeles, California (PRWEB) August 10, 2013
After a rough patch during the economic downturn, in which revenue fell 7.7% in 2008 and 17.5% in 2009, the Cement Manufacturing industry bounced back strongly in 2010. “Stronger domestic demand from residential and nonresidential construction markets fueled the post-recession recovery,” says IBISWorld industry analyst Sean Windle. In addition, cement continues to replace lumber, ceramic, steel and other building materials on job sites due to its low cost and durability. These factors fostered strong growth following the recession, with revenue expected to increase at an annualized rate of 1.5% to $1.9 billion during the past five years, including a 1.3% gain expected in 2013.
In addition to weakened domestic demand, the economic downturn caused demand from the United States, the Cement Manufacturing industry's top foreign market, to plummet. An appreciating Canadian dollar and the lure of manufacturers in Mexico and China, which can produce and sell cement for lower prices, caused many US buyers to source cement elsewhere. “The one-two punch of lower domestic demand and lower foreign demand forced industry manufacturers to lower their prices, hurting profitability,” says Windle.
Despite a continued decline in demand from US buyers, the industry is forecast to grow strongly over the next five years. A sustained recovery in domestic construction markets and continued government funding for road and highway construction will drive this growth.
The industry has a medium level of market share concentration. The vast majority of Canadian cement manufacturers are owned by or are subsidiaries of foreign companies. For example, the top four Canadian cement companies (Lafarge, St. Marys Cement Group, Holcim and HeidelbergCement) are all owned by foreign companies.
For more information, visit IBISWorld’s Cement Manufacturing in Canada industry report page.
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IBISWorld industry Report Key Topics
This industry manufactures portland, natural, masonry, pozzolanic and other hydraulic cements. Cement manufacturing establishments may thermally treat (or calcine) earths; they may also mine, quarry, manufacture or purchase lime.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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