SKOKIE, Ill.—Although a slowdown of the U.S. economy is expected, experts predict cement consumption this year to reach 129.6 million tons, an increase of 2.3 percent compared to 2005 levels, extending a three-year period of continual growth. Additional growth is forecasted for 2007, with a 1.2 percent consumption increase.

PCA’s spring forecast had projected a 3.5% growth rate in 2006.

“Higher interest rates, oil prices, and inflation will slow consumer spending,” Edward Sullivan, PCA chief economist said. “These forces will result in a harsh decline in residential building and slow the recovery in nonresidential construction activity in 2006 and 2007.”

Sullivan also expects slower job growth to contribute to a more cautious approach to public spending.

Additionally, the PCA summer forecast reports that the tight market conditions seen during the past two years have been dramatically reduced. According to PCA’s most recent survey, only two states reported tight conditions—compared to 30 states in 2004 and 2005. Large gains in imports in the first half of 2006 contributed significantly to the easing of supply issues.

About the Summer Forecast 2006
PCA’s Summer Forecast begins with a macroeconomic look at the components of economic growth. Based on those factors, PCA evaluates the impact on construction, breaking down the public, nonresidential and residential sectors. The cement and concrete forecast is derived from construction sector assessments.

About PCA
Based in Skokie, Ill., the Portland Cement Association represents cement companies in the United States and Canada. It conducts market development, engineering, research, education, and public affairs programs.

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Note to editors: To obtain a copy of PCA’s Summer Forecast contact Patti Flesher at newsroom@cement.org.