Sullivan noted while major storms resulted in a weak 2021 start, it is likely that cement consumption growth will match or exceed 2020’s performance. Record low mortgage rates have prompted strong gains in 2020 single family construction. The low rates are expected to remain in-place through 2021, resulting in further strong demand for cement consumption. Non-residential declines are expected to continue this year and next, but the drag on overall growth is expected to lessen. And as oil prices rise, oil well cement will increase as well.
“This recovery is predicated on continued progress in fighting Covid-19. The rapid pace in vaccinations and increased mask usage have resulted in a decline in death rates from over 3000 daily in January 2021 to less than 825 today,” said Sullivan. “The Institute of Health Metrics and Evaluation (IHME) projects the path of Covid-19 through the second quarter of 2021. Their forecast suggests a sustained and significant decline in daily Covid-19 deaths to less than 170. Progress associated with Covid-19 is the critical factor in the near-term outlook.”
“After committing to spending US$ 5.2 trillion in Covid-19 relief and adding another US$ 2 trillion in operations, the federal U.S. debt could rise US$ 7 trillion dollars in 2020-2021. This puts the discussion of the Biden proposal into context. The proposal must pay for itself which means higher taxes. While investing in traditional infrastructure such as roads and bridges has bi-partisan appeal, tax increases and some programs dubiously labeled as infrastructure have caused concern. This concern threatens the potential passage on the infrastructure initiative,” said Sullivan.