Recession takes its toll on ready-mixed sector

Latest BDS report shows more than 100 ready-mixed concrete plants have closed since 2008

MORE than 40 ready-mixed concrete plants have closed over the past 12 months, bringing the number of plants that have shut since the recession began in 2008 to more than 100. This has been one of the industry’s reactions to a decline in volumes of 45% since the recession started. Slightly more than 1,000 concrete plants remain.

These conclusions are contained in the latest annual report published by BDS Marketing Research Ltd entitled ‘Estimated market shares of ready-mixed concrete companies in Great Britain’.

In terms of individual companies, BDS estimate that, for the first time ever, Hanson are now the largest ready-mixed concrete supplier in Great Britain, although they are believed to be only slightly larger than their two main rivals, Tarmac and CEMEX. Together, these three companies are thought to have just over half of the market.

The other major recent company development has been the acquisition of C&G Concrete by Breedon, which has strengthened the latter company in East Midlands markets.

The BDS report estimates the outputs and market shares of all ready-mixed concrete companies in the country, for each county. It notes that eight companies have ceased concrete production over the last 12 months, although more than 300 companies remain in the industry.

The market has recovered slightly during 2011, helped primarily by increased activity in the London area. This relates to additional building of commercial, hotel and leisure facilities in anticipation of the 2012 Olympics. In other parts of the country, however, concrete volumes are at best static, and in some regions show a further decline on 2010.

Looking ahead, BDS are concerned that the public expenditure cuts already announced will further impact on the market in 2012, and demand in the private sector is unlikely to fully replace this fall. Moreover, Olympics-related schemes will now begin to tail off and not be replaced by contracts of a similar size.

The consultancy is therefore forecasting a small decline in 2012, but stronger growth in both 2013 and 2014. By this time, say BDS, a degree of confidence should be returning to private markets, while the cutbacks in public expenditure should have largely worked through the system.

For further details contact BDS Marketing.