Aggregate & Ready Mix Association of Minnesota Reports Tight Cement Supplies in Minnesota will Continue into 2005.

BURNSVILLE, Minn. -- Minnesota ready mix concrete producers report increasingly dependable supplies of cement as the end of the fall construction season comes to an end. Fears of regional shortages of cement earlier in the year fortunately did not occur although supplies for many projects were uncertain throughout the spring and summer.

Predictions of cement shortages came from greater than expected construction activity in the U.S. over the winter of 2003-2004 and heavy demand in China and Asia resulting in insufficient shipping capacity for foreign cement imports to the U.S. As the 2004 construction year progressed, these pressures relieved themselves and the U.S. economy settled into a more manageable pattern throughout the summer. Increased communications between Minnesota ready mix producers and their customers about upcoming projects allowed projects and cement supplies to be better managed and resulted in fewer delayed projects. National ready mix consumption increased by 8.4% for the year to date through August and reflects the continued pressure of a strong economy and construction market in the U.S.

Cement has seen higher consumption in the southern states in recent years. On top of that, consumption has increased nationwide every year since 1991 with the exception of 2002 (a down year for the construction industry). California, Texas, and Florida are the front-running states in cement consumption, accounting for more than 30% of all cement consumed in the U.S. Over the last thirty years, Nevada has emerged as the leader in terms of cement consumption growth. Additionally, per capita tonnage of cement is on the rise. The per thousand capita tonnage in 2003 was 369.7 tons, and is projected to rise to 399.9 tons per thousand capita by 2008.

Expectations for the rest of this year and through 2005 are for more of the same at the current time. Hurricanes in the southeast, continued strength in residential markets nationwide and a stable economy will continue to consume cement at a rapid pace. The upper Midwest has been spared the shortages experienced in the southeastern and western states through a combination of domestic cement shipments and foreign shipments. Additional handling capacity for barge traffic on the Mississippi River has also allowed more cement to be shipped into the Minnesota market throughout the summer.

While there is no guarantee of market certainty, some analysts are predicting further volatility into 2005 as seasonal cycles for construction continue. The fluctuating price of raw materials however has resulted in a commercially impractical situation where suppliers of raw materials cannot reliably anticipate materials costs. While concrete has traditionally seen price stability over the long term, increasing demand regionally and nationally will be reflected in periodic or rolling price fluctuations. The goal of the ready mix industry is to serve the state of Minnesota with an adequate and dependable supply of concrete. Local ready mix concrete producers will continue to be the best source of information for current market conditions and its impact on concrete supplies.

For more information, please call Fred Corrigan, Executive Director, Aggregate & Ready Mix Association of Minnesota at 952.707.1250. Information for this release includes information from the following website - http://www.cement.org/pca/shortageQA.asp