German Construction Industry Faces Historic Crisis as Cement Consumption Drops to Pre-WWII Levels

Germany's construction materials sector is experiencing a historic crisis, with cement consumption plummeting to levels not seen since before World War II, according to Dominik von Achten, president of the Federal Association of Building Materials – Stone and Earth (BBS).

“

The consumption of cement in Germany, but also in other European countries like France, is at the level before the Second World War.

Von Achten, who also heads the Dax-listed company Heidelberg Materials, stated that cement consumption in Germany and other European countries like France has drastically declined in recent years. "Cement consumption in Germany is currently around 30 percent below the 2020 level. This is no longer stagnation; it's a recession," he told the German Press Agency.

“

Cement consumption in Germany is currently around 30 percent below the level of 2020. This is no longer stagnation; it's a recession.

The downturn is attributed to several factors. High interest rates and increased construction and ancillary costs are dampening private housing construction. Investment in public infrastructure projects and in industrial and office buildings is also decreasing. "Domestic demand remains weak. Housing construction is still in the doldrums," von Achten noted.

“

Domestic demand remains weak. Housing construction is still in the doldrums.

While new building permits have recently increased by about 10 percent, it takes months for construction to actually begin. Government funding for infrastructure projects has been announced, but its impact has been minimal so far. "The good news is that the billions are now planned and should translate into increased construction activity from the second half of the year," von Achten added.

“

The good news: The billions are now planned and should translate into increased construction activity from the second half of the year.