“For this year we expect cement consumption to return to positive territory, in part due to a higher level of execution of public investment projects, especially by subnational governments,” Scotiabank noted.

Domestic cement consumption would grow again this year in Peru after two years of decline, in 2022 and 2023, in line with the annual growth projection of 3.7% in the construction sector during 2024, Scotiabank forecast.

He pointed out that domestic cement consumption fell 11.6% during 2023, according to INEI figures.

“This result was within what we expected, taking into account the factors that affected the annual consumption of cement during the first half of 2023 - social conflicts, adverse weather conditions and an increase in the price of food that affected the spending capacity of the company. population-“, he maintained.

He stated that although a lower level of fall was recorded during the second half of 2023, given the relative improvement in cement consumption in the third quarter -especially in the central area of the country-, this could not compensate for the meager annual result.

And by 2024?

“For this year we expect cement consumption to return to positive territory, in part due to a higher level of execution of public investment projects, especially by subnational governments,” he noted.

He added that a higher level of cement consumption by the self-construction segment - which demands between 60% to 70% of this input each year - would also favor the sector, given that, with respect to 2023, there would no longer be exogenous factors that affect the income level of the population, such as social protests and a lower probability of being affected, compared to what was expected, by the El Niño Phenomenon in the coming months.

Added to this would be the boost in the development of projects in transportation infrastructure, in projects in the mining sector and even in the real estate sector.

"For this reason, we project that domestic cement consumption would grow again in 2024 - after falling in 2022 and 2023 -, in line with our annual growth projection of 3.7% in the construction sector during 2024," Scotiabank highlighted.