1. World of Concrete Cement Outlook Ed Sullivan, Chief Economist PCA

2. World of Concrete Introduction: Overview  The economy is weakening.  A recession is very possible.  50%  Dependent on job creation and Federal Reserve actions.  Fiscal actions will not avert recession.  PCA’s recession scenario is gaining in probability.  Downside risks to baseline forecast projections.

3. World of Concrete Portland Cement: Recession (Scenario 50%) Thousand Metric Tons Baseline Projections Recession Projections Recession More Likely: May not be short or shallow. Trough Point 2009

4. World of Concrete Cement Consumption: Long Term Million Metric Tons Growth in Context of Population Changes, Slower US Economic Growth, Strong Global Growth, Climate Change Legislation and the “Green” Revolution.

5. World of Concrete Long-Term Cement Outlook 2009-2030

6. World of Concrete US Population Thousands of Persons US Population Adds Roughly 65 Million People by 2030 …. a 22% Increase.

7. World of Concrete Demographics: 2007-2030 Population Adds 65 Million Persons Adds 9.1 Million School-Age Persons Education Construction Adds 34 Million Retirement Age Persons Medical Adds 31 Million Households Housing, Retail & Infrastructure

8. World of Concrete Long-Term Public Outlook 2009-2030

9. World of Concrete Highway Lane Miles Thousands of Miles Just to Maintain Current Highway Congestion Levels, Federally Aided Highways Must Expand Nearly 25% by 2030. Given 49 Million Additional Licensed Drivers.

10. World of Concrete Pacific Mountain West North Central East North Central South Atlantic East South Central District of Columbia West South Central New England Middle Atlantic 51 - 70 mls/100031 - 50 mls/1000≤ 30 mls/1000 71 – 90 mls/1000≥ 90 mls/1000 2007 Road Congestion Lane Miles per 1,000 Licensed Drivers

11. World of Concrete Pacific Mountain West North Central East North Central South Atlantic East South Central District of Columbia West South Central New England Middle Atlantic 51 - 70 mls/100031 - 50 mls/1000≤ 30 mls/1000 71 – 90 mls/1000≥ 90 mls/1000 2030 Road Congestion Lane Miles per 1,000 Licensed Drivers

12. World of Concrete Cumulative CO2 Impact From Congestion Metric Tons of C02 2007 Urban Mobility Report: 3 Billion Gallons of Fuel Wasted Due to Congestion 30 Million Metric Tons of CO2 Emissions Addressing Infrastructure Needs Should be Part of a Comprehensive Climate Change Policy

13. World of Concrete Medicaid Pressures Build Billions of $ Blue/Solid: Total Medicaid Spending Red/Striped: State Medicaid Spending 2032: State Medicaid Spending Exceeds One Trillion $ 21.5% of Total State Expenditures 25% 30% 34%

14. World of Concrete Will Medicaid “Crowd Out” Highway Spending? Billions of Real State Spending Targeting Transportation Transportation Spending: Constant 8% Share of Budget Transportation Spending: Share Reduced to 5% of Budget Transportation Spending: Share Reduced to 7% of Budget Gasoline Tax Increases Must Be Viewed in the Context of Future Fiscal Pressures Facing States

15. World of Concrete Long-Term Residential Outlook 2009-2030

16. World of Concrete Per Home, Lifetime C02 Savings ICF Home Over Frame Co2 Metric Tons, Per Home Additional C02 Emitted by Cement Production Total Heating & Cooling C02 Saving: 92 Tons per Home Conservatively Assumes 50 Year Life of Home

17. World of Concrete ICF & Related Systems: CO2 Savings Metric Tons of CO2 Gains Achieved Though Energy Savings In Space Heating & Cooling 2030: Housing Starts Average 1.9 Million Annually. ICF & Related Systems Reach 30% Market Share 10% of Total Housing Starts 20% 25% 30%

18. World of Concrete Potential “Green” Gains: ICF & Related Systems Incremental Gains in Cement Consumption, Metric Tons 2030: Housing Starts Average 1.9 Million Annually. ICF & Related Systems Reach 30% Market Share 10% of Total Housing Starts 20% 25% 30%

19. World of Concrete Long-Term Cement Consumption Outlook 2009-2030

20. World of Concrete Cement Share of Cementitious Materials Share of Total Cementitious Materials Increased Use of Fly Ash and Slag Reduces Cement Share

21. World of Concrete Cement Consumption: Long Term Million Metric Tons

22. World of Concrete Supplying the Beast Meeting Long Term Requirements

23. World of Concrete U.S. Supply Balance: No New Capacity Expansion Plans Million Metric Tons Cement Consumption Clinker Production Assumes No New Capacity: 2011-2030 Imports

24. World of Concrete Supply Gap Grows: Increased Dependence on Imports? Million Metric Tons Cement Supply Gap Assumes No New Capacity: 2011-2030

25. World of Concrete Freight Rates: Cyclical or Structural Trends ? $ Per Metric Ton HANDYSIZE 28-40,000 DWT Transatlantic U.S. East Coast/U.S. Gulf HANDYMAX 40-50,000 DWT South East Asia U.S. Gulf

26. World of Concrete Conclusions Industry Leadership

27. World of Concrete Cement: Long Term Outlook & Sustainability Long term vision must discount current, short lived business cycles. Population and economic growth will fuel growth in consumption. “Green” advantages of concrete will add to growth. Fabric of demographic changes presents new challenges. Climate change legislation offers opportunity and risk. Global growth adds a new wrinkle to long term supply.

28. World of Concrete Cement Outlook Ed Sullivan, Chief Economist PCA