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Growth in sales of construction products expected in 2Q and 2014

World Cement,

Construction products sales

The UK’s Construction Products Association (CPA) has published its State of Trade Survey, which suggests an increase in sales of construction products in 1Q14 and rising hopes for 2Q14. Around 76% of construction product manufacturing firms saw a rise in sales compared to the previous quarter and half of firms expect sales to rise by 5% over the next year. However, some 60% of companies reported rising costs in 1Q, driven by energy and fuel prices. Around 80% expect costs to increase in 2014.

According to Dr Noble Francis, Economics Director at the CPA, house building, private sector office construction and new infrastructure projects aided 1Q growth. On another positive note, expects are forecast to grow this year and around half of construction product manufacturers expect that they will invest in plants and equipment in 2014.

“Looking forward, product manufacturers anticipate the construction recovery to continue in Q2 and over the next year, again due to growth in housing, commercial and infrastructure. As a consequence, 86% of firms, on balance, expect sales to rise in the next 12 months,” said Dr Francis. “Exports of construction products rose in Q1 and industry is even more optimistic looking forward. With prospects improving in the Eurozone, 38% of heavy side firms and 61% of light side firms anticipate sales rising over the coming year despite the rising value of Sterling.”

UK construction output

According to ONS estimates, the seasonally adjusted estimate of construction output in February 2014 was 2.8% lower than the previous month of January 2014. Within this, new work was down 2.6% and repair and maintenance dropped by 3.1%. New work output was estimated at £5800 million in February, some 12.3% less than the monthly peak of £6600 million in June 2011.

However, in December 2013 – February 2014 construction output was approximately 0.3% higher than the previous three months, with new work rising by 1%. Although there was a 0.3% improvement in public housing repair and maintenance during the period, total repair and maintenance contracted by 0.8%.

Edited from various sources by

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