Recession claims concrete and asphalt plants

Over the last 12 months, BDS Marketing Research has identified over 75 concrete plants that have closed due to the recession. Of these, 56 were operated by the top five companies. Over the same period, just 15 plants have opened. Commenting on the results of the survey, Julian Clapp, MD of BDS Marketing said: ‘Many of these plants had come to the end of their useful life and companies could not afford to replace them. Other plants were closed to stem losses."

Tarmac remains as the largest ready mixed concrete company in the industry, having replaced Cemex as the largest supplier last year. The list of the top five is completed with Hanson, Aggregate Industries and Lafarge. These companies together represent nearly 80% of the market.

These are some of the conclusions of BDS Marketing's annual report on the industry entitled: ‘Estimated market shares of ready mixed concrete companies in Great Britain'.

The industry has been one of the hardest hit in the current recession. Volumes fell by 16% in 2008 and a further 30% last year. However, the month on month trend suggests that the market is unlikely to go lower in the current year. BDS is forecasting a marginal improvement in sales during 2010 and 2011. However, concern over publically financed projects means that the market will struggle to recover to the levels enjoyed a few years ago.

The asphalt market also suffered last year, falling by nearly 20%, following a 3% drop in the previous year. Seventeen asphalt plants are thought to have closed in Great Britain over the last year. Of these, six have been replaced with new plants, but 11 have closed and are unlikely to re-open unless market conditions improve. This is one of the conclusions of the BDS annual report on this industry. As well as identifying changes in plant ownership and coverage, the report estimates the outputs of all plants in the country, together with a three year industry forecast. Market shares on a county, regional and national basis are then calculated for each company.

BDS has identified only 13 Highways Agency road schemes planned to start in 2010. This could have a devastating impact on the industry from next year, when the sector is also likely to be grappling with falling local authority expenditure on road maintenance. The only bright note on the horizon is the current M25 and A46 road contracts, which will provide a boost in the short term.

Tarmac continues as the largest asphalt supplier, a position it has held for many years.

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