The Portland Cement Association's (PCA) expectations for cement consumption this year were reduced at the organization's spring board meeting in Chicago, Ill. In spite of the decline, improvements in the construction sector, pent-up demand and passing effects from sequester-related budget cuts earlier in the year should benefit the cement market in the second half of 2013 and beyond.

The Portland Cement Association (PCA) has moderated its predictions for cement usage in 2013, in light of sequestration cuts and the state of the construction industry.

While 2012's gains in cement consumption were the strongest in seven years, the forecast presented at the PCA's spring board meeting anticipated a 6.2 percent annual increase in 2013, a reduction from the 8.1 percent growth predicted in January's report. (The level of construction activity and the prevailing cement intensity, or how much cement is used per construction project, dictates cement consumption levels.)

The trade group credited the downgrade in part to the effect of government budget cuts on the larger economy. PCA economist Ed Sullivan expects most of this year's market recovery to occur in the second half of 2013, as state deficits shrink and construction growth increases. The PCA expects housing starts to reach a 1 million-unit rate in 2013, for example; despite flirting with that rate in March, starts dipped to a five-month low in April.

All sectors of construction are predicted to grow through 2014-2015, which is expected to create large gains in cement consumption. PCA economists are predicting consumption levels will reach 120 million metric tons by 2017, a 53 percent increase over the 78.5 million-ton rate set in 2012.