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Domestic cement sales is an important indicator of building and construction activity (it is used in both sectors). The information is timeous, since it is published 10 days after month end. The % …

Domestic cement sales is an important indicator of building and construction activity (it is used in both sectors). The information is timeous, since it is published 10 days after month end. The % change in Cum YTD sales (in tonnes) can be compared with the same statistic for local building lumber sales (in m3) and with BPP and BC (in m2). Thus the cpmparative % change rates provide an holistic view of the trends in building and construction and provides the facility to develop a MAT outlook for every sector for the remainder of the year under review.

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  • 1. THE STRATEGIC FORUM www.strategicforum.co.za Studium Ad Prosperandum •• BUILDING RESEARCH BUILDING RESEARCH BMI BMI STRATEGY CONSULTING STRATEGY CONSULTING UNIT cc UNIT cc  Voluntas in Conveniendum Reg. No. 2002/105109/23 THE STRATEGIC FORUM A place of assembly for strategic conversations Towards Making sense of the Building Industry: Domestic Cement Sales Dr. Llewellyn B. Lewis Dec 20111 © BMI-BRSCU
  • 2. THE INDUSTRY DASHBOARD: BPP & BC, CEMENT AND LUMBER SALES: 2010, 2009 & 2011 THE INDUSTRY DASHBOARD: DECEMBER 2011: BPP AND BC (SEPT), CEMENT AND LUMBER SALES (OCT). Domestic Cement Sales (Tonnes) ended 2010 at -7,75% compared to 2009 Cumulative Y/Y January 2011 for Domestic Cement Sales recorded a decrease of -5,04% compared to 2010, followed by Cumulative Y/Y declines of -3,34% in February, -2,85% in March, -1,91% in April, -2,11% in May, +0,04% in June and +0,07% in July and + 0,69% in August, +2,08% in September and +2,95% in October - thus a gradually improving trend. The MAT Forecast for Domestic Cement Sales shows marginal growth of + 2,46% for 2011 vs 2010. Local Building Lumber Sales (m3) ended 2010 at +7,20% compared to 2009. Cumulative Y/Y January 2011 recorded a massive increase of 34,58% compared to 2010, followed by Cumulative Y/Y growths of 19,62% in February, 17,38% in March, 12,86% in April, 12,56% in May, 15,57% in June, 15,78% in July, 14,61% in August, +17,48% in September and +15,67% in October. It does appear as if Lumber Sales is continuing to "buck the trend" which may be the "green shoots" the building industry is looking for. The MAT Forecast for Local Building Lumber Sales (in m3) shows strong growth of + 13,06% for 2011 vs 2010. . Total Building Plans Passed (m2) ended 2010 at -11,65% compared to 2009. Cumulative Y/Y building plans passed (BPP) by larger municipalities (in m2) for YTD Sept 2011 decreased by - 2,56% compared with Sept 2010. • A decrease was reported for Additions and Alterations BPP (- 15,02%), whilst • BPP for Residential Buildings increased by + 3,95%. • The increase reported for non residential buildings BPP was + 4,83%. Longer term trends in the non- residential sector still reflect falling demand levels. The MAT Forecast for Residential BPP (in m2) shows marginal decline of - 0,62%, Non Residential BPP shows decline of – 4,90% and Total Building shows decline of – 1,95% for 2011 vs 2010.2
  • 3. THE INDUSTRY DASHBOARD: BPP & BC, CEMENT AND LUMBER SALES: 2010, 2009 & 2011 Total Buildings Completed (m2) ended 2010 at -27,87% compared to 2009. Cumulative Y/Y buildings reported as completed (BC) to larger municipalities (in m2) for YTD Sept 2011 decreased by – 8,11% compared with Sept 2010. • The largest percentage decrease in the value of buildings reported as completed (BC) was reported for Non residential building (- 21.39%), whilst • Residential buildings recorded a decline (- 2,92%) and • Additions and Alterations decreased (- 5,44%). After these first 9 months results it is still our view that the decline in Residential Investment should decrease month on month from now on and in spite of the expected decline in Non Residential activity (about half that of Residential Building) will contribute to the positive growth in Total Investment in Building from the third quarter of 2011. The MAT Forecast for Residential BC shows marginal decline of – 2,41%, Non Residential BC shows DECLINE of – 13,80% and Total Building shows DECLINE of – 6,06% for 2011 vs 2010. From the foregoing comparisons it can be seen that ALL the indicators indicate a turning point and MAT Forecasts indicating gradual growth (less negative). It still remains to be seen whether the gradual improvement in BPP and BC from the levels achieved in 2010 will be encouraged by the increasing willingness of the Banks to relax their stringent lending criteria so that Mortgage Advances can flow into the industry. At this stage it is mainly first time homebuyers in the middle income sector that are benefiting.3
  • 4. THE INDUSTRY DASHBOARD: BPP & BC, CEMENT AND LUMBER SALES: 2010, 2009 & 2011 Cumulative YTD Buildings Completed (BC), Domestic Cement Sales and Local Building Lumber Sales: % Change by Sector: January - Dec 2011 (Source: StatsSA; BMI-BRSCU Workings) 40% MAT FORECAST 30% 20% 10% Percentage 0% -10% -20% -30% -40% Jan- Feb Mar Apr- May Jun- Jul- Aug Sep Oct- Nov Dec 11 -11 -11 11 -11 11 11 -11 -11 11 -11 -11 Total Res BC Cum YTD % Change (m2) -13.68% -9.13% 3.09% -0.18% -7.48% -3.69% -5.13% -6.44% -3.19% -2.16% -1.94% -1.78% Total Non Res BC Cum YTD % Change (m2) -27.22% -3.67% -10.82% -9.64% -13.66% -8.22% -17.75% -19.86% -18.45% -19.69% -18.06% -16.91% Total BC Cum YTD % Change (m2) -17.93% -7.58% -1.42% -3.25% -9.44% -5.12% -9.29% -10.79% -8.08% -7.92% -7.16% -6.62% Domestic Cement Sales (Tonnes) -5.04% -3.34% -2.85% -1.91% -2.11% 0.04% -0.02% 0.61% 2.08% 2.95% 3.58% 3.34% Local Building Lumber Sales (m3) 34.58% 19.62% 17.38% 12.86% 12.56% 15.57% 15.78% 14.61% 17.48% 15.67% 14.10% 13.22%4
  • 5. DOMESTIC CEMENT SALES Y/Y COMPARISON BY MONTH & DAY: 2011 VS 2010 AND 2009 NATIONAL CEMENTITIOUS SALES STATISTICS FOR SOUTH AFRICA (excluding sales to Botswana, Lesotho, Namibia, Swaziland, Imports by 3rd parties, sales by other than reporting companies and Exports.) RELEASE: NOVEMBER 2011 SA Cementitious Monthly Sales Tons SA Cementitious Daily Average Sales Tons Number of Sales Days Period Change Change 2011 2010 2009 2011 2010 2009 2011 2010 2009 11 vs 10 10 vs 09 11 vs 10 10 vs 09 January 638 749 672 676 842 461 -5.0% -20.2% 30 417 33 634 40 117 -9.6% -16.2% 21 20 21 February 823 934 840 586 933 254 -2.0% -9.9% 41 197 42 029 46 663 -2.0% -9.9% 20 20 20 March 1 008 902 1 030 817 1 066 644 -2.1% -3.4% 45 859 46 855 48 484 -2.1% -3.4% 22 22 22 April 816 337 807 820 896 069 1.1% -9.8% 45 352 42 517 49 782 6.7% -14.6% 18 19 18 May 912 584 939 318 1 011 066 -2.8% -7.1% 45 629 44 729 50 553 2.0% -11.5% 20 21 20 June 996 500 903 857 984 862 10.2% -8.2% 47 452 43 041 46 898 10.2% -8.2% 21 21 21 July 973 004 976 041 1 096 446 -0.3% -11.0% 46 334 44 365 47 672 4.4% -6.9% 21 22 23 August 1 014 939 970 004 1 007 000 4.6% -3.7% 46 134 46 191 50 350 -0.1% -8.3% 22 21 20 September 1 104 877 980 071 1 047 578 12.7% -6.4% 50 222 46 670 49 885 7.6% -6.4% 22 21 21 October 1 055 669 956 783 1 085 584 10.3% -11.9% 50 270 45 561 49 345 10.3% -7.7% 21 21 22 November 1 141 248 1 045 907 1 024 985 9.1% 2.0% 51 875 47 541 48 809 9.1% -2.6% 22 22 21 December 746 514 787 719 -5.2% 35 548 37 510 -5.2% 20 21 21 10 486 743 10 870 394 11 783 670 3.6% -7.8% 45 595 43 308 47 135 3.6% -8.1% 250 251 250 Total YTD Annual YTD Annual YTD Annual YTD Annual Annual SA Cementitious Monthly Sales Tons SA Cementitious Daily Average Sales Tons Number of Sales Days Period Change Change 2011 2010 2009 2011 2010 2009 2011 2010 2009 11 vs 10 10 vs 09 11 vs 10 10 vs 09 Month 1 141 248 1 045 907 1 024 985 9.1% 2.0% 51 875 47 541 48 809 9.1% -2.6% 22 22 21 YTD 10 486 743 10 123 880 10 995 950 3.6% -7.9% 45 595 44 017 48 017 3.6% -8.3% 230 230 229 MAT 11 233 257 10 911 599 2.9% 44 754 43 473 2.9% 251 2515 © BMI-BRSCU
  • 6. THE MARKET FOR MAJOR BUILDING PRODUCTS BY PRODUCT: 2009 The market for major Building Product Groups by value: 2009 (Source: BMI-BRSCU) 0% 2% 4% 6% 8% 10% 12% 14% 16% Roofing and Vertical Cladding 4.40% Ceilings and Partitioning 1.26% Walling 7.28% Paving 1.35% Wall Tiles 1.36% Flooring 6.27% Cement 12.84% Aggregate and Sand 6.43% Reinforcing Steel and Sections 13.42% Sanware 3.01% Taps, Mixers and Fittings 2.61% Plumbing Pipes and Fittings 1.56% Pipes and Fittings 10.16% Geysers 1.90% Glass and Mirrors 1.98% Doors 1.17% Total value of major Building Product Garage Doors 0.33% Groups = R103,4 Billion in 2009. Frames 2.85% Major Building Product Groups account Roof Trusses 2.95% for 52,32% of Total Building and Construction Materials and 31,4% of TotalWindowsills, Fasciaboards and Bargeboards 0.87% Investment in Building and Construction. Rainwater Goods 0.25% Decorative Paint 6.46% Flatboard (PB, MDF, Other)** 8.27% Insulation 1.01%6 © BMI-BRSCU
  • 7. THE MARKET FOR CEMENT IN BUILDING BY SECTOR AND SEGMENT: 2010 PRIVATE RESIDENTIAL DEMAND AND MARKET SHARE FOR CEMENT BY SEGMENT - Dwelling Houses < 80m2 2.14% IN THE BUILDING INDUSTRY: 2010 (R MILLIONS) - Dwelling houses > 80m2 13.00% (Source: StatsSA, SARB, C&CI, BMI-BRSCU Workings) - Townhouses and Flats 4.86% - Other (Including Hotels) 0.85% - Additions and Alterations 5.23% Sub-total 26.08% PUBLIC RESIDENTIAL - Affordable Housing 16.04% - Public Authorities 3.24% - Public Corporations 0.03% Sub-total 19.30% - Unrecorded Res Additions and Alterations 6.52% TOTAL RESIDENTIAL 51.90% BUILDING TYPE : NON RESIDENTIAL - Offices 5.45% - Shops (Commercial) 5.05% - Industrial 11.08% - Other (Including Casinos) 2.27% - Recorded Additions and Alterations 4.76% TOTAL PRIVATE NON RES SEGMENT 28.60%- Unrecorded Non Res Additions and Alterations 6.79% TOTAL PUBLIC NON RES SEGMENT 12.71% TOTAL NON RESIDENTIAL SECTOR 48.10% 0 0 0 0 0 1 17 © BMI-BRSCU
  • 8. THE MARKET FOR CEMENT IN CONSTRUCTION BY SECTOR AND SEGMENT: 2010 DEMAND AND MARKET SHARE FOR CEMENT IN CONSTRUCTION BY SEGMENT: 2010: TONNES (Source: StatsSA, BMI-BRSCU Workings) Roads Streets, Bridges etc 1,598,718 Waterworks 533,857 Sewerage 263,788 Other Construction Works 1,455,975 Private Sector 1,857,367 TOTAL CEMENT IN CONSTRUCTION 5,709,706 (Lower Middle Road Scenario) 0 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,0008 © BMI-BRSCU
  • 9. DOMESTIC CEMENT SALES: 1892 - 2010 Domestic Cement Sales: 1892-2010 (Source: Cement & Concrete Institute; BMI -BRSCU Workings) 14 000 000 12 000 000 10 000 000 8 000 000Tonnes 6 000 000 4 000 000 2 000 000 0 1892 1896 1900 1904 1908 1912 1916 1920 1924 1928 1932 1936 1940 1944 1948 1952 1956 1960 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 20089 © BMI-BRSCU
  • 10. DOMESTIC CEMENT SALES: Y/Y % CHANGE 1893 - 2010 Domestic Cement Sales: Y/Y % Change: 1893 -2010 (Source: Cement & Concrete Institute; BMI -BRSCU Workings)150%130%110%90%70%50%30%10%-10%-30%-50% 1893 1897 1901 1905 1909 1913 1917 1921 1925 1929 1933 1937 1941 1945 1949 1953 1957 1961 1965 1969 1973 1977 1981 1985 1989 1993 1997 2001 2005 200910 © BMI-BRSCU
  • 11. DOMESTIC CEMENT SALES: 1997 – MAT* 2011 (* NOVEMBER) Annual Domestic Cement Sales: 1997 - MAT* 2011 (* Nov) (Source: Cement & Concrete Institute; BMI-BRSCU Workings) 15 000 000 14 000 000 13 000 000 12 000 000Tonnes 11 000 000 10 000 000 9 000 000 8 000 000 7 000 000 6 000 000 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 201111 © BMI-BRSCU
  • 12. DOMESTIC CEMENT SALES BY MONTH: 1997 – 2011 (NOVEMBER) Domestic Cement Sales by Month: 1998-2011 (Nov) (Source: Cement & Concrete Institute; BMI-BRSCU Workings) 1 500 000 1 400 000 1 300 000 1 200 000 1 100 000Tonnes 1 000 000 900 000 800 000 700 000 600 000 500 000 400 000 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Domestic Cement Sales by month 12 per. Mov. Avg. (Domestic Cement Sales by month)12 © BMI-BRSCU
  • 13. DOMESTIC CEMENT SALES vs BPP: CUM Y/Y % CHANGE BY MONTH: 1999 – 2011 (NOVEMBER) Cumulative Y/Y percentage change by month:Domestic Cement Sales (Tonnes) vs BPP (M2): Jan 1999 - Nov 2011 (Source: StatsSA; Cement & Concrete Institute; BMI-BRSCU Workings)40%30%20%10% 0%-10%-20% Cum Y/Y % Change: Total Cement Sales (Tonnes)-30% Cum Y/Y % Change Total BPP (m2) 12 per. Mov. Avg. (Cum Y/Y % Change: Total Cement Sales (Tonnes))-40% 12 per. Mov. Avg. (Cum Y/Y % Change Total BPP (m2))-50% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 201113 © BMI-BRSCU
  • 14. DOMESTIC CEMENT SALES vs BC: CUM Y/Y % CHANGE BY MONTH: 1999 – 2011 (NOVEMBER) Cumulative Y/Y percentage change by month:Domestic Cement Sales (Tonnes) vs BC (M2): Jan 1999 - Nov 2011 (Source: StatsSA; Cement & Concrete Institute; BMI-BRSCU Workings)30%20%10% 0%-10% Local Cement Sales appear to be more closely correlated to Total BPP than to BC and also leads the revival in BC?-20% Related to Merchant anticipation of revival and stock build-up in anticipation?-30% Cum Y/Y % Change: Total Cement Sales (Tonnes) Cum Y/Y % Change Total BC (m2)-40% 12 per. Mov. Avg. (Cum Y/Y % Change: Total Cement Sales (Tonnes)) 12 per. Mov. Avg. (Cum Y/Y % Change Total BC (m2))-50% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 201114 © BMI-BRSCU
  • 15. DOMESTIC CEMENT SALES CUM Y/Y COMPARISON BY MONTH: 2010 VS 2009 AND 2008 Domestic Cement Sales: Cumulative Y/Y Comparison: 2010 vs 2009 and 2008 (Source: Cement & Concrete Institute; BMI-BRSCU Workings) 14,000,000 12,000,000 10,000,000 Tonnes 8,000,000 6,000,000 4,000,000 2,000,000 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Cum Y/Y sales: 2008 894,157 2,056,94 3,096,51 4,291,18 5,458,64 6,651,70 7,917,50 9,113,69 10,291,6 11,586,7 12,644,9 13,472,8 Cum Y/Y sales: 2009 842,458 1,775,71 2,842,35 3,738,42 4,749,49 5,734,35 6,830,79 7,837,79 8,885,37 9,970,95 10,995,9 11,783,6 Cum Y/Y sales 2010 672,676 1,513,26 2,544,08 3,351,90 4,291,21 5,195,07 6,171,11 7,141,12 8,121,19 9,077,97 10,123,8 10,870,3 % Change Cum Y/Y 2009 VS 2008 -5.78% -13.67% -8.21% -12.88% -12.99% -13.79% -13.73% -14.00% -13.66% -13.95% -13.04% -12.54% % Change Cum Y/Y 2010 VS 2009 -20.15% -14.78% -10.49% -10.34% -9.65% -9.40% -9.66% -8.89% -8.60% -8.96% -7.93% -7.75%15 © BMI-BRSCU
  • 16. DOMESTIC CEMENT SALES CUM Y/Y COMPARISON BY MONTH: 2010 VS 2009 AND 2008 Domestic Cement Sales: Cumulative Y/Y Comparison: 2010 vs 2009 and 2008 (Source: Cement & Concrete Institute; BMI-BRSCU Workings) 16,000,000 -25% 14,000,000 -20% 12,000,000 10,000,000 -15% Tonnes 8,000,000 -10% 6,000,000 4,000,000 -5% 2,000,000 0 0% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Cum Y/Y sales: 2008 894,157 2,056,9 3,096,5 4,291,1 5,458,6 6,651,7 7,917,5 9,113,6 10,291, 11,586, 12,644, 13,472, Cum Y/Y sales: 2009 842,458 1,775,7 2,842,3 3,738,4 4,749,4 5,734,3 6,830,7 7,837,7 8,885,3 9,970,9 10,995, 11,783, Cum Y/Y sales 2010 672,676 1,513,2 2,544,0 3,351,9 4,291,2 5,195,0 6,171,1 7,141,1 8,121,1 9,077,9 10,123, 10,870, % Change Cum Y/Y 2009 VS 2008 -5.78% -13.67% -8.21% -12.88% -12.99% -13.79% -13.73% -14.00% -13.66% -13.95% -13.04% -12.54% % Change Cum Y/Y 2010 VS 2009 -20.15% -14.78% -10.49% -10.34% -9.65% -9.40% -9.66% -8.89% -8.60% -8.96% -7.93% -7.75%16 © BMI-BRSCU
  • 17. DOMESTIC CEMENT SALES CUM Y/Y COMPARISON BY MONTH: 2011 VS 2010 AND 2009 (NOV) Domestic Cement Sales: Cumulative YTD November 2011 vs 2010 and 2009 (Source: Cement & Concrete Institute; BMI-BRSCU Workings) 12,000,000 4% 3% 10,000,000 Cumulitive % Change: YTD 2011 vs 2010 2% 8,000,000 1% Tonnes MAT FORECAST 0% 6,000,000 -1% 4,000,000 -2% -3% 2,000,000 -4% 0 -5% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Cum YTD sales: 2010 672,676 1,513,26 2,544,08 3,351,90 4,291,21 5,195,07 6,171,11 7,141,12 8,121,19 9,077,97 10,123,8 10,870,3 Cum YTD sales 2011 & MAT Forecast 638,749 1,462,68 2,471,58 3,287,92 4,200,50 5,197,00 6,170,01 7,184,94 8,289,82 9,345,49 10,486,7 11,233,2 % Change Cum YTD 2011 VS 2010 -5.04% -3.34% -2.85% -1.91% -2.11% 0.04% -0.02% 0.61% 2.08% 2.95% 3.58% 3.34%17 © BMI-BRSCU
  • 18. DOMESTIC CEMENT SALES BY MONTH: 2011 VS 2010 AND 2009 (NOVEMBER) SA Cementitious Monthly Sales Tons 1 200 000 1 100 000 1 000 000 900 000 800 000 2011 700 000 2010 600 000 2009 500 000 400 000 May July April October September November December January March February June August18 © BMI-BRSCU
  • 19. DOMESTIC CEMENT SALES BY DAY: 2011 VS 2010 AND 2009 (NOVEMBER) SA Cementitious Daily Average Sales Tons 55 000 50 000 45 000 40 000 2011 35 000 2010 30 000 2009 25 000 20 000 May July April October September November December January March February August June19 © BMI-BRSCU
  • 20. DOMESTIC TOTAL CEMENT SALES BY SECTOR: 2010 Domestic Cement Sales by Sector: 2010 (Total = 10 870 396 Tonnes) (Source: Cement and Concrete Institute, BMI BRSCU Workings) Building, 5,160,690, 47% Construction, 5,709,706, 53%20 © BMI-BRSCU
  • 21. DOMESTIC BUILDING TOTAL CEMENT SALES BY APPLICATION: 2010 BUILDING INDUSTRY CEMENT MARKET BY APPLICATION : 2010 TOTAL = 5160 690 TONNES (Source: StatsSA, BMI-BRSCU Workings) - Foundations, 516,069, 10% - Roofing, 516,069, 10% - Superstructure, - Walling, 2,064,276, 2,064,276, 40% 40%21 © BMI-BRSCU
  • 22. DOMESTIC BUILDING TOTAL CEMENT SALES BY SECTOR: 2010 BUILDING INDUSTRY CEMENT MARKET BY SECTOR : 2010 TOTAL CEMENT MARKET = 5 160 690 TONNES (Source: StatsSA, BMI-BRSCU Workings) TOTAL CEMENT IN NON RESIDENTIAL SECTOR, 2,356,315, 46% TOTAL CEMENT IN RESIDENTIAL SECTOR, 2,804,375, 54% TOTAL CEMENT IN NON RESIDENTIAL SECTOR TOTAL CEMENT IN RESIDENTIAL SECTOR22 © BMI-BRSCU
  • 23. DOMESTIC BUILDING BULK CEMENT SALES BY SECTOR: 2010 BUILDING INDUSTRY BULK CEMENT MARKET BY SECTOR : 2010 TOTAL = 2 375 893 TONNES (Source: StatsSA, BMI-BRSCU Workings) TOTAL BULK CEMENT IN RESIDENTIAL SECTOR, 1,291,086, 54% TOTAL BULK CEMENT IN NON RESIDENTIAL SECTOR, 1,084,807, 46%23 © BMI-BRSCU
  • 24. DOMESTIC BUILDING BAGGED CEMENT SALES BY SECTOR: 2010 BUILDING INDUSTRY BAGGED CEMENT MARKET BY SECTOR : 2010 2 784 797 TONNES TOTAL NON (Source: StatsSA, BMI-BRSCU Workings) RESIDENTIAL BAGGED CEMENT MARKET, 1,271,508, 46% TOTAL RESIDENTIAL BAGGED CEMENT MARKET, 1,513,289, 54%24 © BMI-BRSCU
  • 25. DOMESTIC BUILDING TOTAL CEMENT SALES BY SECTOR: 2010 BUILDING INDUSTRY TOTAL CEMENT MARKET BY SECTOR : 2010 5 160 690 TONNES (Source: StatsSA, BMI-BRSCU Workings) TOTAL CEMENT IN RESIDENTIAL SECTOR, 2,804,375, 54% TOTAL CEMENT IN NON RESIDENTIAL SECTOR, 2,356,315, 46%25 © BMI-BRSCU
  • 26. DOMESTIC TOTAL BUILDIUNG CEMENT SALES BY SUPPLIER: 2010 THE TOTAL BUILDING CEMENT MARKET BY SUPPLIER : 2010 TOTAL = 5 160 690 TONNES (Source: C&CI, StatsSA, BMI-BRSCU Workings) - Imports/Other, 103,214, 2% - Cimpor , 516,069, - Lafarge , 1,032,138, 10% 20% - PPC, 1,961,062, 38% - Afrisam , 1,548,207, 30%26 © BMI-BRSCU
  • 27. CUM YTD DOMESTIC CEMENT SALES BY END USE SECTOR: 2011 (NOV) Domestic Cement Sales by End-use Sector: Cum YTD 2011 (November) (2011 MAT TOTAL = 11 233 257 Tonnes) (Source: Cement and Concrete Institute, BMI BRSCU Workings) Mining 1.54% Total Sales for YTD 2010 (Nov) = 10 123 882 Tonnes C.P.M. 13.45% Total YTD Sales for 2011 (Nov) 10 486 743 tonnes (+3,58%)Readymix Producers 17.82% Resellers 49.02% Civil Construction 6.93% Building 4.20% Construction Blenders 4.77% Other 2.26% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%27 © BMI-BRSCU
  • 28. DOMESTIC CEMENT SALES BY END USE SECTOR: CUM YTD 2011 VS 2010 (NOV) Domestic Cement Sales by End-use Sector: Cum YTD 2011 vs 2010 (Nov) (Source: Cement and Concrete Institute, BMI BRSCU Workings) 0 500 000 1 000 000 1 500 000 2 000 000 2 500 000 3 000 000 3 500 000 4 000 000 4 500 000 5 000 000 5 500 000 Mining C.P.M.Readymix Producers Resellers Civil Construction Total Sales forBuilding Construction YTD 2011 VS 2010 (Nov) = + 3,58% Blenders Other Building Readymix Other Blenders Civil Construction Resellers C.P.M. Mining Construction Producers YTD 2010 227 921 481 422 426 071 700 489 4 963 318 1 804 720 1 364 139 155 802 YTD 2011 236 887 500 516 440 863 727 097 5 140 869 1 868 836 1 410 252 161 42328 © BMI-BRSCU
  • 29. DOMESTIC CEMENT SALES TO BUILDING & CONSTRUCTION BY END USE SECTOR: YTD 2011 (NOV) DOMESTIC CEMENT SALES BY END USE TO BUILDING AND CONSTRUCTION: YTD 2011 (Nov) (Total = 10 486 743 Tonnes) (Source: Cement and Concrete Institute, BMI BRSCU Workings) 4 600 000 55% 4 400 000 4 200 000 4 000 000 3 800 000 45% 3 600 000 3 400 000 3 200 000 3 000 000 35% 2 800 000 2 600 000Tonnes 2 400 000 25% 2 200 000 2 000 000 1 800 000 1 600 000 15% 1 400 000 1 200 000 1 000 000 800 000 5% 600 000 400 000 200 000 0 -5% Readymix Civil Building Mining C.P.M. Resellers Blenders Other Producers Construction Construction Tonnes 161 423 1 410 252 1 868 836 5 140 869 727 097 440 863 500 516 236 887 Percentage 1.54% 13.45% 17.82% 49.02% 6.93% 4.20% 4.77% 2.26%29 © BMI-BRSCU
  • 30. DOMESTIC CEMENT SALES TO BUILDING BY END USE SECTOR: YTD 2011 (NOV) DOMESTIC CEMENT SALES BY END USE TO THE BUILDING INDUSTRY: YTD 2011 (NOV) (Total = 5 612 348 Tonnes) (Source: Cement and Concrete Institute, BMI BRSCU Workings) 4 200 000 90% 4 000 000 3 800 000 80% 3 600 000 3 400 000 3 200 000 70% 3 000 000 2 800 000 60% 2 600 000 2 400 000 Tonnes 50% 2 200 000 2 000 000 1 800 000 40% 1 600 000 1 400 000 30% 1 200 000 1 000 000 20% 800 000 600 000 400 000 10% 200 000 0 0% Readymix Civil Building Mining C.P.M. Resellers Blenders Other Producers Construction Construction Tonnes 12 107 148 076 280 325 4 498 261 145 419 352 691 150 155 26 653 Percentage 0.22% 2.64% 4.99% 80.15% 2.59% 6.28% 2.68% 0.47%30 © BMI-BRSCU
  • 31. DOMESTIC CEMENT SALES TO CONSTRUCTION BY END USE SECTOR: YTD 2011 (NOV) REGIONAL CEMENT SALES BY END USE TO THE CONSTRUCTION INDUSTRY: YTD 2011 (NOV) (Total = 4 874 395 Tonnes) (Source: Cement and Concrete Institute, BMI BRSCU Workings) 1 600 000 35% 1 400 000 30% 1 200 000 25% 1 000 000 20% Tonnes 800 000 15% 600 000 10% 400 000 5% 200 000 0 0% Readymix Civil Building Mining C.P.M. Resellers Blenders Other Producers Construction Construction Tonnes 149 316 1 262 175 1 588 511 642 609 581 678 88 173 350 361 210 233 Percentage 3.06% 25.89% 32.59% 13.18% 11.93% 1.81% 7.19% 4.31%31 © BMI-BRSCU
  • 32. DOMESTIC CEMENT SALES: BAG AND BULK BY END USE SECTOR: YTD 2011 (NOV) DOMESTIC SALES OF BAG AND BULK CEMENT BY END USE: YTD 2011 (NOV) (TONNES) (TOTAL = 10 486 743 TONNES) (Source: Cement and Concrete Institute, BMI BRSCU Workings) 5 200 000 5 000 000 4 800 000 4 600 000 4 400 000 4 200 000 4 000 000 3 800 000 3 600 000 3 400 000 3 200 000 3 000 000TONNES 2 800 000 2 600 000 2 400 000 2 200 000 2 000 000 1 800 000 1 600 000 1 400 000 1 200 000 1 000 000 800 000 600 000 400 000 200 000 0 Readymix Civil Building Mining C.P.M. Resellers Blenders Other Producers Construction Construction Bulk 72 640 1 269 227 1 775 394 0 690 743 264 518 400 412 141 941 Bags 88 782 141 025 93 442 5 140 869 36 355 176 345 100 103 94 94632 © BMI-BRSCU
  • 33. DOMESTIC CEMENT SALES: BAG BY END USE SECTOR: YTD 2011 (NOV) DOMESTIC CEMENT SALES BY BAGS AND END USE SECTOR: YTD 2011 (NOV) (TOTAL = 5 871 868 TONNES) (Source: Cement and Concrete Institute, BMI BRSCU Workings) 90% 80% 70% 60% 50%Axis Title 40% 30% 20% 10% 0% Readymix Civil Building Mining C.P.M. Resellers Blenders Other Producers Construction Construction Bags 1.51% 2.40% 1.59% 87.55% 0.62% 3.00% 1.70% 1.62%33 © BMI-BRSCU
  • 34. DOMESTIC CEMENT SALES: BULK BY END USE SECTOR: YTD 2011 (NOV) DOMESTIC CEMENT SALES BY BULK AND END USE SECTOR: YTD 2011 (NOV) (TOTAL = 4 614 875 TONNES) (Source: Cement and Concrete Institute, BMI BRSCU Workings) 40% 35% 30% 25% 20% 15% 10% 5% 0% Readymix Civil Building Mining C.P.M. Resellers Blenders Other Producers Construction Construction Bulk 1.57% 27.50% 38.47% 0.00% 14.97% 5.73% 8.68% 3.08%34 © BMI-BRSCU
  • 35. DOMESTIC CEMENT SALES: TONNES & PERCENTAGE BY PROVINCE: YTD 2011 (NOV) Domestic Cement Sales by Province: YTD 2011 (NOV) (Total = 10 486 743 Tonnes) (Source: Cement and Concrete Institute, BMI BRSCU Workings) 33.45% 4 000 000 35% 3 500 000 30% 3 000 000 25% Tonnes*1000 2 500 000 20% 12.74% 2 000 000 11.05% 3 507 796 15% 9.30% 8.60% 1 500 000 7.11% 10% 4.84% 4.14% 1 000 000 3.86% 3.09% 1.84% 1 335 942 500 000 1 158 306 5% 901 536 975 160 745 172 404 484 507 153 434 212 323 802 193 179 0 0% NORTHERN KZN NORTHERN CAPE LIMPOPO MPUMALANGA EASTERN CAPE NORTH WEST WESTERN CAPE GAUTENG BORDER/TRANSKEI FREE STATE SOUTHERN KZN35 PROVINCE © BMI-BRSCU
  • 36. 36 -8% -6% -4% -2% 0% 2% 4% 6% 8% 10% 12% January Februar March April May June July 2002 August Septem October Novem Decem January Februar March April May June July 2003 August Septem October Novem Decem January Februar March April May June July 2004 August Septem October Ordinary and extended cement Novem Decem January Februar March April May June July 2005 August Septem October Novem Decem January Februar March April May June July 2006 August Septem October Novem Decem January Februar March April May 2007 June July August www.strategicforum.co.za Septem October Novem (Source: StatsSA; BMI-BRSCU Workings) Decem January Februar March April May 2008 June July August Septem October Novem Decem January Februar Building and Construction March April May June July 2009 August Septem October Novem Decem January PRICE MOVEMENT OF CEMENT VS BUILDING AND CONSTR AND CPI: JAN 2002-JULY 2011 Februar March April May June July 2010 August Septem October Novem Decem CPI January Februar March April May 2011 June July© BMI-BRSCU
  • 37. 37 90 100 110 120 130 140 150 160 170 180 190 200 210 220 230 240 250 260 270 280 290 300 310 320 January Februar March April May June July 2002 August Septem October Novem Decem January Februar March April May June July 2003 August Septem Bricks - Stock October Novem Cement (Retail) Decem January Februar March April Cement building blocks May June July 2004 August Septem Ordinary and extended cement October January 2000 = 100 SA Pine Kiln Dried Novem Decem January Februar March April Building construction : Building industries May June July 2005 August Septem October Novem Decem January Februar March April May June July 2006 August Septem October Novem Decem January Februar March April May 2007 June July www.strategicforum.co.za August Septem October Novem Decem Ordinary and CPI January (Source: StatsSA; BMI-BRSCU Workings) Sand Februar March Extended Cement April May 2008 June July Bricks - Face August Septem October SA Pine, kiln dried Novem Decem January Februar March April May June July 2009 August Septem October Novem Decem January Februar Aggregated crushed stone (as from 2/86) March PRODUCER PRICE INDEX (PPI) OF SELECTED BUILDING MATERIALS: JANUARY 2002- JULY 2011 April May June CPI July 2010 August Septem October Novem Decem January Februar March April May 2011 June July© BMI-BRSCU
  • 38. 38 SA Index (2000 = 100) Pi ne , ki ln 100 110 120 130 140 150 160 170 180 190 200 210 220 230 240 250 260 270 280 290 300 310 dr Ag ie gr Br Pa d eg C ic ks in at em ts ed en Bri - St ck o cr u tb c ui s - k O she ld Fa G rd in la in d s t g ce ss ar on bl ,f y oc or N an e ( ks at d as bu ur ex fr Sa ild al t o n in sto end m 2 d g Bricks in ne, ed /86 du c ) st cut em ry an en D (a d t ro s D p in fro saw ro G m n p cei yp C in lin su 1/9 er ce g m 3) am ilin tile bo ic g s-g ar d & til es yps en -m um ca a us Fl so tic us nit Cement W wa h e ov ll & do en D ors f ra N loo in ee r t Pl a g dl ile um e e s Pu & b i nc mo ng h s C C a Pa eil ar ics rti in pe CPI tio g m tin n a g Sh ing ter ee ma ials t, te C galv rial em a s C Fib Co en niz oa re nc t ed te r ( d cem ete Ret www.strategicforum.co.za pr a of ent roo il) ile ro f ti d G of s les M S he (Source: StatsSA; BMI-BRSCU Workings) Vi sh ets ny ee G l ti la Vi floo ng ss n rt fo W yl il rt W as she es he C h et bu pa an in ild ns d b g in an as g in C d b in du op id st pe ets ry rp Bu ild - in Bu cut ipe Producer Price Index (PPI) by type of Material: July 2011 (January 2000 = 100) g ild to s an ing si d z B e Bu Co oa ild ns rd in tru s C g In ctio iv i l du n En s t gi rie ne s er in g C PI Price doubling since January 2000© BMI-BRSCU
  • 39. DOMESTIC CEMENT SALES: TONNES & PERCENTAGE 2002-2010; 2011-2020 (LOWER MIDDLE ROAD SCENARIO) TOTAL CEMENT IN BUILDING: 2006-2010 LOWER MIDDLE ROAD SOYUZ AND HIGH ROAD COLUMBUS SCENARIOS: 2011-2020 (Source: BMI-BRSCU Database) 10,000,000 8,629,195 8,543,757 8,542,116 8,459,165 9,000,000 8,133,813 7,822,536 7,820,974 8,542,116 7,309,321 8,000,000 7,039,423 6,831,142 7,822,536 6,495,861TONNES 7,000,000 7,039,423 5,925,666 5,920,201 5,573,545 6,582,775 6,519,392 5,160,690 6,000,000 6,186,268 6,122,989 5,920,201 5,813,724 5,507,606 5,356,208 5,226,431 5,215,856 5,000,000 5,160,690 5,117,648 4,000,000 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 202039 © BMI-BRSCU
  • 40. DOMESTIC CEMENT SALES: TONNES & PERCENTAGE 2002-2010; 2011-2020 (LOWER MIDDLE ROAD SCENARIO) TOTAL CEMENT IN CONSTRUCTION: 2006-2010 HIGH ROAD MOTORWAY AND LOWER MIDDLE ROAD FREEWAY SCENARIOS: 2011-2020 (Source: BMI-BRSCU Database) 7,994,003 7,914,063 7,837,258 7,834,922 9,000,000 7,464,055 7,464,055 6,911,162 8,000,000 6,536,109 6,227,962 5,966,642 5,906,976 5,741,970 7,000,000 5,709,706 5,424,220 6,536,109 6,000,000 6,227,962 4,522,370 5,741,970 5,709,706 5,000,000TONNES 5,069,855 4,795,134 4,645,286 4,595,337 4,522,370 4,470,463 4,470,463 4,445,489 4,000,000 4,220,717 4,170,767 3,846,097 3,000,000 2,000,000 1,000,000 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 TOTAL CEMENT IN CONSTRUCTION (Lower Middle Road Scenario) TOTAL CEMENT IN CONSTRUCTION (High Road Scenario)40 © BMI-BRSCU
  • 41. DOMESTIC CEMENT SALES: TONNES & PERCENTAGE 2002-2010; 2011-2020 (LOWER MIDDLE ROAD SCENARIO) (0,1); PPC Mill (0,3) PPC SK7 Upgrade TOTAL CEMENT IN BUILDING AND CONSTRUCTION: 2006-2010 Continental (0,6) PPC (0,7 Net); Afrisam (0,4); Sephaku (2,2) LOWER MIDDLE ROAD VS HIGH ROAD SCENARIOS: 2011-2020 Cimpor (0,6) (Source: StatsSA, BMI-BRSCU Workings) 24,000,000 25,000,000 22,000,000 CAPACITY INCREASES (Mt/yr) 20,000,000 20,000,000 18,000,000 TONNES 16,000,000 15,000,000 14,000,000 12,000,000 10,000,000 10,000,000 8,000,000 5,000,000 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 TOTAL CEMENT IN BUILDING AND CONSTRUCTION (LOWER MIDDLE ROAD SCENARIO) TOTAL CEMENT IN BUILDING AND CONSTRUCTION (HIGH ROAD SCENARIO) TOTAL CEMENT IN BUILDING AND CONSTRUCTION (AT 218 KG PER CAPITA) Capacity (Million Tons/Year) PPC FORECAST: 2006-2015 (Deutsche Bank Presentation: July 2008)41 © BMI-BRSCU