Cement Production Hits 75 Year Low Threatening UK Housebuilding Ambitions

Cement manufacturing in the UK has plunged to its lowest level since 1950, dealing a substantial blow to ambitions of revitalising housebuilding nationwide. According to the Mineral Products Association (MPA), just 7.3 million tonnes of cement were produced domestically last year, marking a decline of almost 20 percent compared to five years ago.

These figures arrive at a critical juncture, with government data revealing that only 35,640 new homes commenced construction in the first three months of this year—a stark contrast to the quarterly average of 75,000 required to meet the target of 300,000 homes annually. With output dwindling, Labour’s pledge to build 1.5 million homes by 2030 faces mounting challenges.

Rising input costs have been cited as a main driver behind the production slump, compounding the existing malaise in the sector. The MPA has cautioned that the situation poses a significant risk to both housing and infrastructure plans. Notably, concrete sales also fell to their lowest levels for over six decades, illustrating the widespread impact.

Prof Noble Francis, economist at the Construction Products Association, warned that government aspirations are increasingly out of reach. Businesses now face heightened regulatory obligations and surging labour costs, all of which contribute to increased construction expenses and stagnating productivity.

Competition from imports has also become more pronounced. Approximately 32 percent of cement used in the UK is now imported, up from just 12 percent in 2008. Dr Diana Casey of the MPA indicated that foreign producers often benefit from lower electricity prices and reduced carbon taxes, placing domestic operations at a disadvantage. Such disparities are especially visible as large-scale projects, including substantial investments in wind energy and nuclear infrastructure like the Sizewell C plant, maintain robust demand for cement.

The Home Builders Federation has identified flatlining housing supply as another contributor to weaker cement demand, noting that access to affordable mortgages and recent taxation on development have suppressed construction activity. Reaching government targets, they argue, will require decisive policy interventions exceeding current planning reforms.