Cement intensity growth is key to market growth during the next couple of years. Cement intensities refer to the tonnes of cement per dollar of construction activity.
Our forecast projects that cement intensities will increase by 2 percent in 2007, fueled by a favorable relative price position vs. asphalt and steel, as well as a shift toward higher cement usage construction projects. Code changes in hurricane-prone regions, improved cement products, and concrete's growth as a "green" building material will all contribute to this despite a decrease in construction activity.
Additionally, the PCA fall forecast does not expect the sharp decline in housing to continue at the current rate. The recent downward change in the housing market was driven by the departure of speculators from the market. Their exit will actually help introduce a correction to housing prices and improve affordability for the average home buyer.