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Adbri retains strong tendering pipeline, expects infrastructure spending to drive demand


Adbri is expecting the 2020 Federal Budget to improve demand for its product due to increased infrastructure spending.

The company described its tendering pipeline as “very strong” in its 12th annual Australia & New Zealand investment conference, which was presented in mid-October.

Adbri boss Nick Miler said investment into state infrastructure projects along with tax write-offs would boost the market’s competitiveness and help Australia reach an economic recovery.

Aggregates sales for the September quarter were up 18 per cent from the corresponding period through residential sub-division work demanding lower value fuel materials.

Adbri said this is an indicator of future demand for cement, aggregates and concrete volumes.

Since the first half of 2020, Adbri’s Queensland demand had improved due to residential construction, while New South Wales remained “subdued” due to less effective residential stimulus measures. Adbri said infrastructure demand has improved its outlook of New South Wales.

South Australia has benefitted from both HomeBuilder and infrastructure projects which have driven aggregate volumes. Western Australia has seen a rebound in demand, with Adbri’s exposure to the Western Australia economy being higher than other domestic competitors.

In Victoria, Adbri’s sites have continued to run under Stage 4 COVID-19 restrictions, with demand in state across August and September being around 80 per cent of pre-lockdown restrictions. Adbri noted that demand had fluctuated due to customers managing limited construction site staffing during Stage 4 restrictions.

The Northern Territory market for Adbri has slowed due to limited residential construction activity and the timing of projects.

The company’s total recordable injury frequency rate (TRIFR) has continued to improve, dropping to 9.4 in September 2020 after the company introduced its ‘Step Change” safety program in 2019.

For long-term improvements to carbon emissions, Adbri is continuing to replace fossil fuel kilns with biomass refuse-derived fuel.

The majority of Adbri’s fuel sources have moved away from emissions-intensive coal. About 22 per cent of the company’s fuel is from coal, while 47 per cent is derived from natural gas.

The company is planning to switch the remaining coal usage of its Munster, WA plant to natural gas by the end of the year.

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