Recently, I have been catching up on the news and have repeatedly come across the well-worn phrase ‘ticking time bomb’. In fact, if you google ‘ticking time bomb 2013’, you get a depressing number of results.
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Things that fall under this umbrella include:
- European debt.
- Interest-only mortgages.
- Sequestration in the US – referring to spending cuts rather than carbon.
- Eurozone youth unemployment.
- Climate change.
- Population growth.
- Ageing populations.
- Strikes in South Africa.
…and that’s just sifting through the first few pages of results. Looking at each of these it is difficult to ignore the intrinsic ramifications that they all could have on the cement industry, whether local, regional or global. Another housing crisis or further recession could spell the end for some plants this year, but equally the constant pressure of population growth and the challenge of increased urbanisation is an opportunity for new investments, plant expansions and, indeed, new entrants to the industry.
In the last quarter of 2012 it was already evident that there was a lot of caution in the air, wrapped up in US fiscal policy and uncertainty in the eurozone. We talk of the cement industry being cyclical, so we have to expect that its fate is going to be closely tied to that of specific market economies – I’m going to go out on a limb and predict that 2013 is not going to be a big growth year for the cement industry in Western Europe. As we begin 2013, however, the short-term fate for the US is up for debate. With the fiscal cliff disaster temporarily averted, much will depend on how Congress votes on the myriad remaining issues that stand between the current situation and recovery. Meanwhile, all the evidence points to continued growth for the cement industry in parts of Asia, Africa and Latin America. Uncertainty in the eurozone isn’t hampering growth for these guys.
So what time bombs should the cement industry be looking out for this year? Well the rumour is that CO2 reduction is going to be the US cement industry’s next big challenge, now that the EPA has finalised the Portland cement NESHAP (see page 49). Increasing the use of alternative fuels will no doubt play its part, and that means converting processes, reaching out to local communities and gaining the necessary permits while also navigating CISWI. In terms of market forecasts, look no further than the article from IA Cement beginning on page 46, which summarises industry trends for 2013. From a personnel perspective, skills shortages are going to be a global problem going forward, but it is unlikely that this will come to a head while some markets are still on the brink of recession.
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