MPA hopeful after boost in sales volumes

Chief Executive Nigel Jackson

THE latest MPA data indicates yet further improvement in sales of mineral products in the first half of 2014.

Compared to Q2 last year, crushed rock was the fastest growing market (up 9%), whilst both asphalt and sand & gravel were 4% higher. Ready mixed concrete sales fell 3.2% over the period, but the decline should be viewed in the context of the very high volumes seen last year and the underlying market trends remain positive.
The MPA data indicates further growth in 2014 although more modest and stabilising. However even with 3% growth trends markets would not regain pre-recession levels until after 2020.
Provisional GDP figures indicated a fall in construction activity by 0.5% in the second quarter, reducing overall economic output by 0.03%. However, sales of MPA materials should be an early indicator of official construction output data and it is expected that construction activity will improve again during the third quarter this year.
MPA Chief Executive, Nigel Jackson, said, “We are seeing continuing general growth in mineral products markets although, as expected, the speed of underlying growth has slowed from the end of 2013.
“We believe our figures indicate that the second quarter reduction in construction activity is a blip and construction will be positive for the year. If the necessary increase in housing starts can be delivered and promised infrastructure investments are implemented, we should see further improvements in industry markets. But this will of course depend on potential economic headwinds and political uncertainties that lie ahead.
“One issue which MPA members are beginning to raise concerns about, particularly in markets which are seeing strong growth such as sand and gravel aggregates in the South East, is whether the planning system will be able to deliver the permissions required to meet aggregates demands associated with future housing and development activity. This is an issue the industry and national and local government will have to monitor and manage carefully going forward if supply constraints which could impact on growth are to be avoided.”