Posted on 18th January 2012 by Trevor in Uncategorized

A question for readers: How big is China when it comes to cement? Keep in mind
that the EU and the USA have GDPs of about $15T apiece. China is much smaller
and has a GDP closer to $6T. Knowing that, what’s your guess on how China
stacks up in the world of cement? I would have thought that China was as big as
the US or EU. The economy is smaller, but they are building so much, my guess
was about equal.

wrong. wrong. I must admit, I was blown away by this:


China is 25 Xs larger than either the US or EU! When it comes
to cement, forget the rest of the world and focus on what is happening in the
country with a 54% market share.

cement production has been on a tear for years. But it’s slowing down. The
production for 2011 will come in at 1.88mm metric tones, an increase of only 6%
over 2010 (the slowest in 15 years). The Cement Association of China is
forecasting that 2012 total production will be “about the same as 2011”. We
shall see. I saw this article on cement pricing in Sichuan province.



Since 2004 China’ GDP has doubled. So has its cement production. That’s not a
coincidence. The forecast for unchanged production in 2012 is inconsistent with
high growth in GDP. What does zero growth in cement production translate into
Chinese economic growth? My guess is that 4% GDP would be a good result. That
would be well below stall speed for China.


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