On Friday, the Australian Bureau of Statistics (ABS) released concrete production statistics for the month of October, which revealed a huge pick-up of concrete volumes in Western Australia and the Northern Territory – two of the prime beneficiaries of the current mining investment boom.
The data is incredibly volatile and no doubt affected by seasonality. As such, it is presented below in index form on a rolling annual basis:
According to the ABS, concrete production rose by 5% nationally in the year to October. Western Australia and the Northern Territory drove much of this growth, registering annual growth rates of 25% and 53% respectively. By contrast, concrete use in the other states grew by a combined 2% only over the year.
While some of this growth in concrete use likely relates to the recent increase in apartment construction (see below chart), the boom in mining-related investment is likely the biggest driver.
As an aside, the ABS earlier in the month released quarterly data for building materials typically used in detached house construction, namely: clay bricks, concrete blocks, and roof tiles. Production of these materials continued to trend lower, suggesting that new home construction remains under pressure (see below chart).
Twitter: Leith van Onselen. Leith is the Chief Economist of Macro Investor, Australia’s independent investment newsletter covering trades, stocks, property and yield. Click for a free 21 day trial.
