Global Portland Cement Market: Infrastructural Development in Developing Regions to Bode Well for Growth, finds TMR

The competition in the global portland cement market is intense due to the presence of a large number of players, states Transparency Market Research (TMR) in a new report. With a high level of forward integration, many leading companies have a distinct advantage over other companies present in the global portland cement market. In order to consolidate their share in the market, manufacturers of portland cement are focusing on enhancing their customer loyalty base. The four prime companies in the market, Lafarge, Holcim, CNBM, and Anhui Conch accounted for a share of 24% in the global portland cement market. However, the portland cement market is oversupplied as companies try to compensate the high fix cost of the product through economies of scale.

The global portland cement market is projected to expand at a 5.1% CAGR from 2014 to 2020. The market was worth US$257.7 bn in 2015 and is anticipated to reach US$332.2 bn by the end of 2020. Based on application, the residential segment held the leading share in the global portland cement market in 2013 and is expected to retain a lead until 2020. It accounted for a share of 45.9% in 2013 and is likely represent 46.6% of the market in 2020. The popularity of portland cement in the residential sector can be attributed to the rising application of the cement in the construction of residential structures. Moreover, the use of portland cement for renovation and maintenance activities in residential buildings is likely to further augment its demand across the globe.

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High Demand for Portland Cement from End Users to Drive Market Growth in Asia Pacific

Geographically, the global portland cement market was dominated by Asia Pacific in terms of consumption in 2013. It accounted for 65.6% in 2013 and is projected to hold a share of 68.1% in 2020 in the global portland cement market. The demand for portland cement is expected to intensify over the forthcoming years owing to the growing number of infrastructural development projects and construction of new residential complexes. Furthermore, growth in urbanization in countries such as Indonesia, Malaysia, India and China is likely to drive the demand for portland cement, thereby augmenting the growth of the market in the region. The portland cement market is expected to witness strong growth over the forecast period as a result of the mounting demand for the cement from the growing infrastructure and residential sectors.

Demand for Portland Cement to be Steered by Growing Urbanization in BRICS and MENA Economies

“The mounting population and need for constructing more efficient structures have provided a thrust to economic and developmental activities in the Asia Pacific region,” says a TMR analyst. As a result of this, the demand for commercial and residential buildings has increased significantly over the region. With the growing inflow of people in cities, the need for better infrastructure facilities such as telecommunications, electricity, sewage, water, roads, and bridges has considerably increased. The application of portland cement is extensively high in these sectors. Furthermore, the rise in infrastructural development and rising urbanization in Brazil, South Africa, and the Middle East and Africa are further expected to drive the growth of the global portland cement market.

Strict Environmental Regulatory Codes Likely to Obstruct Productivity

The cement industry is considered to be a highly energy intensive industry. Cement production requires mixing of raw materials at a temperature of 1300-1500 degrees Celsius. To achieve such high temperatures, manufacturers use carbon fuels. According to a survey, 5% of the global carbon dioxide emissions are a result of the cement manufacturing processes and the carbon used in them. In order to prevent further environmental damage caused by carbon emissions, governments across the world have implemented strict code of conducts for cement manufacturers to follow. As a result of this, manufacturers are looking for alternatives to replace carbon-based fuels which in turn is anticipated to adversely impact the productivity of the industry.

This review is based on a Transparency Market Research report titled, “Portland Cement Market – Global Industry Analysis, Size, Share, Growth, Trends and Forecast, 2014 – 2020.”

Portland Cement Market – Application Segment Analysis

  • Residential

  • Commercial

  • Infrastructure

  • Others (including cement bricks, farm construction, etc.)

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