Portland Cement Association Stimulus funds not affecting current cement consumption

Bureaucratic delays in releasing funds coupled with long lags between outlays and construction activity for American Recovery and Reinvestment Act projects will result in very little stimulatory impact on cement consumption in 2009, according to the most recent economic forecast from the Portland Cement Association.

PCA expects total cement consumption to decline 22 percent during 2009 to 75 million metric tons. The meeting of total ARRA obligations in 2010 combined with the beginning of a sustained pickup in the residential sector should contribute to a 10.9 percent increase in total cement consumption in 2010, followed by a 13.1 percent gain in 2011.

The public construction sector, which typically accounts for 50 percent of cement consumption, is also hampered by large state deficits caused by a perfect storm of adverse economic conditions and job layoffs, leading to declines in state tax revenue. Ed Sullivan, PCA chief economist, expects that as jobs are created and consumer spending returns, public construction spending will rebound, but not until 2011.


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