Burgeoning Calcium Carbonate Prices Influence Global Construction Sector Growth
- 06-Dec-2022 3:29 PM
- Journalist: Jacob Kutchner
Rising interest rates, financial market tightening, and ongoing issues with building material supply and pricing have all significantly impacted the market value of Calcium Carbonate and its derivatives. Since the start of the fourth quarter of 2022, the construction industry has shown no signs of recovery. The negative outlook for the construction sector has stemmed from the burgeoning energy costs across the European region. In addition, the strict COVID-19 guidelines in China have added a new element of uncertainty in the global economy, hampering the market sentiments for Calcium Carbonate.
The array of negative factors has impacted the economic environment for construction sectors, limiting the inquiries for the upstream raw materials, including Calcium Carbonate. However, the rise in TTF natural gas costs in November has heightened the manufacturing costs of Calcium Carbonate. The prices of Industrial grade, Calcium Carbonate has been surged by approximately 10% last month in the domestic region of Germany. Heidelberg Materials, one of the top cement manufacturers, has reported that the group's net result for the nine months showed a 6.1% decline to 2.72 billion Euros. The decrease in the profit margins has been attributed to significantly higher energy prices and increased raw material costs.
Furthermore, one of the significant downstream market players, ACS Group Sales in North America, which accounted for 66% of all construction sales, reached 15 billion Euros in 2021, up 25.8%, demonstrating a solid recovery from the pandemic's effects. The ChemAnalyst database has shown that the price realizations of Calcium Carbonate were USD 810 per tonne on the week ending 2nd December 2022 on a FOB basis. On the other hand, Calcium Carbonate prices have tumbled in the Chinese domestic market. The delays and shortages related to the pandemic have impacted manufacturing activities nationwide.
According to ChemAnalyst, European construction growth is anticipated to remain subdued, lingered by the upward projection of raw material prices. The Asia Pacific region is likely to witness adverse demand patterns amid changing weather conditions, signaling a downturn in construction activities. Thus, collectively Calcium Carbonate prices will likely demonstrate mixed sentiments in Europe and Asia.