The UK cement industry, essential to national construction and infrastructure delivery, is facing a sharp decline in domestic production, raising alarm among industry leaders despite new energy cost relief measures proposed in the government’s latest Industrial Strategy.
The strategy, announced this week, includes a pledge to reduce industrial electricity prices by 25% starting in 2027. While this move is designed to help level the playing field with international competitors, particularly given UK firms currently pay up to four times more for electricity than their US counterparts, sector leaders warn that this support may arrive too late to prevent long-term damage.
Early forecasts suggest UK cement output could hit record lows in 2025, with ten domestic producers under significant pressure from high energy costs and mounting foreign competition.
Diana Casey, Executive Director of Energy and Climate Change at the Mineral Products Association (MPA), welcomed the government’s acknowledgement of the strategic importance of cement and concrete. She pointed to the planned increase in the Network Charging Compensation scheme from 60% to 90% as a meaningful step toward improving industrial competitiveness. However, she cautioned that waiting until 2027 for the Industrial Competitiveness Scheme to take effect “could pose difficulties for many in the sector.”
Imports of cement have more than doubled over the last decade, now accounting for over 30% of UK supply, up from just 12% in the early 2000s. Much of this imported material comes from the EU and North Africa, where energy prices are lower, and manufacturers are not burdened by the same carbon taxes that UK firms face under domestic emissions trading schemes.
“The UK government can choose to invest in a domestic industry that provides high-skilled, well-paid jobs across every region, or risk further reliance on imports, and the supply vulnerabilities that come with it,” said Casey. “Having control over domestic decarbonisation is key to delivering on the UK’s net zero commitments.”
The Industrial Strategy includes a proposed Carbon Border Adjustment Mechanism, intended to apply equivalent carbon costs to imported products. Yet without clear timelines or immediate protections in place, UK manufacturers remain exposed. The added burden of network levies and the instability of renewable energy supply have further eroded competitiveness, leaving domestic firms at a significant disadvantage.
For Kingfisher Industrial, which supports the cement and wider heavy manufacturing sectors through wear protection and process handling solutions, the resilience of UK-based production is vital. Without urgent policy action, the sector risks further contraction, threatening jobs, infrastructure timelines and the nation’s ability to deliver on decarbonisation goals with secure, homegrown industrial capacity.
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References: https://www.cityam.com/uk-cement-sector-at-risk-of-cracking-despite-industrial-strategy/
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