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Potential turnaround in US demand scenario

World Cement,

As the cement industry emerges from the recession, it is expected to embark on a period of sustained growth fuelled by infrastructure investment, sustainable construction and a shift in market dynamics in paving.

This will be discussed in more detail during 'Cement Outlook: Turnaround in 2010 Signals Return to Sustained Growth,' a webcast presentation by Portland Cement Association (PCA) President and CEO Brian McCarthy scheduled for December 9, 2009, at 11:00 a.m. CST.

The expected turnaround in demand and consumption of cement is coming at a time when the industry can really use a jump-start. Since reaching its peak in 2005, cement consumption has declined by about 45%, and the actual decline in usage represents the worst volume decline in the industry’s history.

However, according to PCA, cement consumption is projected to increase by 5.2% in 2010, the first year-to-year rise since the middle of the decade.  Beyond that, demographics and pent-up demand is expected to grow consumption to a greater degree in 2011 and 2012 and beyond.

In 2011, PCA is projecting an overall increase of 16.5% in cement consumption in the US versus 2010 levels, with another incremental 14.5% increase in 2012.

A perfect storm of factors are increasing demand for concrete as a highly sustainable, cost-effective building material for a wide variety of uses including roads, bridges, and both residential and commercial buildings.

Among the factors is a paradigm shift in the cost of building concrete roads versus asphalt roads. In the past, the short-term investment to build an asphalt road was less than the cost of building a concrete road – even though concrete enjoyed a significant cost advantage over the life of the road. However, in 2009, that short-term advantage disappeared completely – accelerated by an increase in the cost of asphalt – and concrete is now not only a more durable solution for building roads, it is also a less costly solution both for the long term as well as for the initial investment.

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