MPA calls for promised funding and projects

Association’s first-quarter sales survey results indicate a further decline in construction activity

THE Mineral Products Association’s survey results for the first quarter of 2013 have confirmed the slow start to construction activity in 2013 and the urgent need for accelerated delivery of promised funding and projects.

Compared with the first quarter of 2012, sales of construction aggregates (crushed rock and sand and gravel) fell by 7%, ready-mixed concrete by 4% and asphalt by 18%. Sales of cement are likely to reflect a similar picture to concrete.

The first-quarter decline in aggregates and concrete sales volumes, in particular, indicates that construction output is also likely to have been at a relatively low level.

While first-quarter construction data can be significantly impacted by adverse weather and caution is required in interpreting data, the MPA says the underlying trends for mineral product sales into construction remain significantly negative.

The very poor asphalt figures follow an 18% decline in 2012 and reflect a very sharp reduction in road maintenance and construction activity over the past 15 months. Office for National Statistics (ONS) data indicate that road construction fell by 41% in 2012.

Given the precipitous decline experienced in road markets, allied to the increasing evidence of worsening road conditions, the MPA says it is essential that the allocated funding increases announced in the 2012 Autumn Statement are turned into projects as a matter of urgency.

Commenting on the survey results, Nigel Jackson, chief executive of the MPA, said: ‘The disappointing first-quarter MPA results reflect the reality that construction activity remains very depressed following the 8% decline in construction during 2012.

‘We hope that the measures to boost housing announced in the Budget and the implementation of infrastructure funding increases from the Autumn Statement will help stimulate increased demand as the year proceeds.

‘The key message must be about focusing on accelerating delivery and the conversion of well-intentioned announcements into increased cash flow throughout the supply chain.

‘Publicly and privately funded infrastructure projects must be delivered more quickly to back up positive policy and funding announcements. If not, the lack of construction activity will continue to be a deadweight holding back economic recovery.’