Heidelberg Materials sees demand driven by energy transition, data centers through 2030

Heidelberg Materials expects that demand and growth through 2030 will be driven by trends such as energy transition, infrastructure rebuilds and new builds, housing and urbanization, defense and data centers, the company said on May 28.

"Megatrends are providing a bigger tailwind than ever before. We are witnessing the biggest waves of capital investment in history," said Dominik von Achten, Chairman of the Managing Board of Heidelberg Materials, in its Strategy 2030 statement during this year's Capital Markets Day in Brevik, Norway.

"We are in the right places with the right products to capitalise on these large-scale global trends and growth opportunities for sustainable concrete applications," he added.

The energy transition will be the biggest driver, the company said, as wind turbines, for example, need 25 times more concrete than a traditional power plant, and to reach the International Energy Agency's projections of 1,200 GW of battery storage in five years, about 4 million cu m of additional concrete per year will be needed.

On infrastructure, 43,000 bridges in the US and 6,000 in Germany need to be replaced, the company said, while airport capacity is expected to be nearly tripled in Morocco by 2030. Housing shortages, defense revamping in Europe, and urbanization in Africa will all contribute to a growth in demand.

Data centers, with an estimated requirement of 45,000 cu m for each, will lead to a "massive" demand for cement.

"Europe is on the verge of a demand rebound, and we are primed to capitalise on this shift. Underlying market demand will force a demand uplift, also driven by stimulus programmes in various countries," Von Achten said.

The reindustrialization in North America will lead to sizable investments, the company added, while structural growth in emerging markets will drive demand over the next years.

Heidelberg will also accelerate the use of supplementary cementitious materials, alternative raw materials and alternative fuels in Europe. "Decarbonisation will drive further growth, our low and zero-carbon product range will be major value drivers," Von Achten said.

The company expects results from current operations to grow by 7%-10% on average per year and has also raised its original target of achieving a return on invested capital of over 10% to 12% by 2030.

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