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Prolonged upturn in materials demand set to continue to 2027
Current upturn in total construction activity is propelling demand, Currently non-residential building the main driver
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Materials demand is in the midst of a prolonged upswing, correlating with the current upturn in total construction activity in Australia. An upswing for cement and concrete demand commenced in early 2021 and we forecast growth to continue to late 2027.
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According to our model, demand for premixed increased by 4.9% over the year to December 2023. This upward trend is set to continue.
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This recent upturn in concrete demand was initially spurred by a mini-boom in house building and alterations and additions. This rapid growth was driven by Government residential building incentives. However, residential building construction has since declined.
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A robust upturn in non-residential building is now the primary driver of the current upswing in demand for concrete. We expect this to continue to a peak during FY2025. The biggest driver of current growth in non-residential building is government spending, particularly in the health sector with governments implementing major programs of capital spending on hospitals (new and upgrades), particularly in Queensland and New South Wales.
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Materials demand is also being supported by a strong upswing in road construction and other engineering construction, namely railways, water and electricity. Electricity construction is of particular note, with the current surge in electricity construction driven by large investments in the renewable energy sector.
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Strength in these sectors and the next upturn in residential building is projected to offset falls in non-residential building and sustain the steady momentum in concrete demand to 2027.
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We provide detailed market estimates and ten years of forecasts of demand for cement, concrete, asphalt, aggregates and related products, typically broken down into 64 geographic regions.
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Our most recent reports:
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Australian Construction Cost Trends
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This report examines the outlook for construction costs, in detail be sector and type of input.
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Australian Construction Projects Database
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This latest list of projects corresponds with our fully revised set of forecasts published in November 2023.
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Australian Regional Construction Outlook
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Our latest regional forecasts for residential building and construction have just been released.
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Australian Construction Materials Forecasts
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Our latest forecasts assess the implications for construction materials demand of the current outlook for building and construction.
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Australian Road and Bridge Works
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This report examines the strength and composition of the current upturn, and determines the likely timing of the peak, and subsequent decline.
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