Weak cement demand seen to persist this year
Cement manufacturers are no longer expecting demand growth this year, as slower government infrastructure spending continues to weigh on construction activity.
Nearly a year after the multibillion-peso graft scandal that had prompted tighter checks on public works projects, Cement Manufacturers Association of the Philippines (Cemap) president Reinier Dizon said the industry had yet to see a meaningful pickup in demand even after the peak construction season from February to April.
While the dry season typically boosts construction activity, Dizon noted that government infrastructure spending—which accounts for about 40 percent of total cement demand—remained sluggish.
“Government spending is slow,” said Dizon, who is also president of Republic Cement and Building Materials Inc. “We hope for at least a flat market.”
Although Cemap has yet to complete its full assessment of industry demand for the year, Dizon said the market would likely end 2026 with a single-digit contraction.
This, as infrastructure and capital outlays plunged 48 percent year-on-year to P59.1 billion in March, while first-quarter infrastructure spending dropped 43.5 percent to P147.8 billion, based on Department of Budget and Management data.
“They’ve tightened, but hopefully starting toward the end of second quarter, beginning of third quarter, they’ll start spending already,” Dizon said.
Even if government spending accelerates later this year, infrastructure activity may still remain constrained after the Department of Public Works and Highways received only P529.6 billion in funding this year, far below its original P881.3-billion proposal.
