Construction Slump Drive Belgium’s Calcium Carbonate Prices to New Lows

Belgium experienced a decline in Industrial Grade Calcium Carbonate prices in early September, primarily driven by weakened demand from the construction sector, a major consumer of Calcium Carbonate. Seasonal factors also contributed to reduced consumption, while a surplus in supply due to increased production efficiency and capacity expansions exerted further downward pressure on prices. This reduction was amplified by higher inventory levels and increased exports from the region.

The price of Industrial Grade Calcium Carbonate in Belgium dropped by approximately 2% on a weekly basis. This decline was influenced by a contraction in the construction sector, a key user of Calcium Carbonate. Belgian construction activity, along with broader EU construction volumes, faced significant headwinds. EU construction volumes are projected to fall by 1.5% in 2024, revised from an earlier forecast of a 0.5% decline. This revision follows a delayed downturn in the sector, which, according to Eurostat data, continued to grow into 2023 before contracting in 2024.

In the first half of 2024, Etex, a major Belgian building materials company, reported a 4.2% revenue decline to €1.93 billion due to significant drops in the new build and renovation markets, where housing indicators fell by 35% to 50%. With housing starts at their lowest since 2003, weakened demand in Etex's core markets reduced Calcium Carbonate consumption, contributing to the price decline. The overall slowdown in Belgium's construction sector, coupled with an EU-wide contraction projected at 1.5% in 2024, further dampened demand for Industrial Grade Calcium Carbonate.

The weak construction sector in Belgium and across Europe played a significant role in reducing demand for Industrial Grade Calcium Carbonate in September 2024. As the construction sector accounts for a major share of Calcium Carbonate consumption, its struggles in both residential and commercial markets had a direct impact on pricing. Additionally, seasonal factors and high inventory levels among producers and distributors contributed to the market surplus, exacerbating the price decline. Inflation in the Eurozone, which reached 2.2% in August, further affected input costs across industries, though core inflation eased to 2.8%, providing some relief to market participants.

While the construction sector faces ongoing challenges, there are positive signs on the horizon. Rising house prices, an increase in building permits, and a recovery in the production of key building materials such as concrete and cement suggest that the downturn may be bottoming out. EU Recovery funds aimed at boosting renovation and infrastructure projects are expected to drive future growth. By 2025, the construction sector in Belgium is anticipated to recover gradually, supported by these positive developments. However, Calcium Carbonate prices may remain under pressure in the short term due to the ongoing market surplus and seasonal slowdowns during the winter months. A gradual price of Calcium Carbonate recovery is likely, contingent on sustained improvement in construction volumes and economic conditions across Belgium and the broader EU.