BAA says OFT study long overdue
THE British Aggregates Association (BAA) has welcomed the announcement by the Office of Fair Trading (OFT) that it is to open a study into the UK aggregates market. The BAA has already made a number of submissions to the OFT with regard to the marketing of dry aggregates, ready-mix concrete and asphalt products, and the Association is also assisting the OFT, the Competition Commission and the EU Competition Directorate with ongoing investigations into the cement supply chain.
The BAA would, ideally, like to limit what it sees as UK market domination by five world players: Anglo American, Holcim, Heidelberg, Lafarge and CEMEX. It argues that environmental, logistical and social factors indicate that aggregates should be produced as locally as possible, as this reduces delivery mileages and underpins local economies. However, the Association claims that the opposite has happened with many local quarries being bought out and closed down. It says a common practice of the larger companies is vertical integration, which can leave other suppliers out in the cold.
There are other areas where the BAA says it will advise the OFT, one of these being 'an archaic’ planning system, which the Association believes has a detrimental affect on competition in the aggregates market.
Likewise, the continuing state aid of the Aggregates Levy, which, in the Association’s opinion, skews the market for primary and secondary aggregates as well as stimulating imports, is seen as another major problem, along with the rising tide of EU legislation which has not had the desired results. According to the BAA, these factors have resulted in some areas of the UK having the most expensive aggregates in Europe, despite them often having excellent mineral reserves.
BAA director Robert Durward, said: ‘An investigation of the UK aggregates market is overdue and is something we have long called for. In areas of the country where few independent companies remain prices are a great deal higher. The Minerals Products Association’s response to the OFT announcement – defending the status quo in minerals planning – does not represent the view of SME companies generally.’
The BAA would, ideally, like to limit what it sees as UK market domination by five world players: Anglo American, Holcim, Heidelberg, Lafarge and CEMEX. It argues that environmental, logistical and social factors indicate that aggregates should be produced as locally as possible, as this reduces delivery mileages and underpins local economies. However, the Association claims that the opposite has happened with many local quarries being bought out and closed down. It says a common practice of the larger companies is vertical integration, which can leave other suppliers out in the cold.
There are other areas where the BAA says it will advise the OFT, one of these being 'an archaic’ planning system, which the Association believes has a detrimental affect on competition in the aggregates market.
Likewise, the continuing state aid of the Aggregates Levy, which, in the Association’s opinion, skews the market for primary and secondary aggregates as well as stimulating imports, is seen as another major problem, along with the rising tide of EU legislation which has not had the desired results. According to the BAA, these factors have resulted in some areas of the UK having the most expensive aggregates in Europe, despite them often having excellent mineral reserves.
BAA director Robert Durward, said: ‘An investigation of the UK aggregates market is overdue and is something we have long called for. In areas of the country where few independent companies remain prices are a great deal higher. The Minerals Products Association’s response to the OFT announcement – defending the status quo in minerals planning – does not represent the view of SME companies generally.’
