I. March Building Materials Industry Prosperity Index

In March 2025, the Building Materials Industry Prosperity Index (MPI) reached 127.2 points, exceeding the threshold and remaining in the prosperity range. This marks a significant rebound from January and February, though the recovery pace was slower than the same period last year.

January and February are traditionally considered the “off-season” for the building materials market. Due to the impact of the Chinese New Year holiday, downstream demand weakened significantly, leading to a slowdown in production among building materials enterprises and causing the MPI to drop below the threshold. After the holiday, the resumption of work and production accelerated across the industry, driving a rebound in market sentiment. In March, as seasonal factors such as climate conditions changed and demand from the construction and manufacturing sectors gradually picked up, production activities in the building materials sector accelerated, leading to a noticeable recovery in industry prosperity.

( Monthly Building Materials Industry Prosperity Index)

On the supply side, in March, the Building Materials Industry Price Index remained below the threshold, while the Production Index exceeded it. Specifically, the Price Index stood at 99.3 points, up 0.5 points from the previous month, while the Production Index reached 128.1 points, rising by 45.3 points compared to February and returning to the prosperity range. Overall, while building materials product prices remained volatile at a low level, signs of stabilization emerged in March. Meanwhile, production activities saw a significant uptick compared to January and February, contributing to the recovery of the MPI.

On the demand side, the Investment Demand Index, Industrial Consumption Index, and International Trade Index all remained above the threshold, indicating prosperity. The Investment Demand Index recorded 126.3 points, up 44.3 points from the previous month, reflecting a notable recovery in construction market activity, with prosperity levels comparable to last year. The Industrial Consumption Index reached 130.1 points, up 49.2 points month-on-month, indicating that demand for building materials in related manufacturing sectors recovered at a faster pace than the previous year. The International Trade Index soared to 145.5 points, increasing by 85.5 points from the previous month, as trade activities for building materials products rebounded quickly after the Chinese New Year. Overall, the demand for building materials in March demonstrated a solid recovery, driving the MPI upward.

II. MPI Influencing Factors and Market Outlook

Market demand is showing signs of recovery. 

A series of pro-growth policies introduced last year have begun to take effect, with multiple regions accelerating construction projects. In the first two months of 2025, infrastructure investment increased by 5.6% year-on-year, marking a recovery, though the real estate construction market has yet to fully rebound. Meanwhile, key manufacturing sectors such as automobiles, solar cells, and electronics continued to expand, with automobile production growing by over 10%, supporting demand for building materials. Additionally, sales revenue from building and decoration materials at large-scale retail enterprises increased by 0.1% year-on-year, reversing the persistent decline observed since May 2024.

Building materials product prices are stabilizing at the bottom. 

In March, four sub-sectors—thermal insulation materials, construction stone, mineral fibers and composites, and architectural ceramics—experienced month-on-month price increases. Meanwhile, the ex-factory prices of cement, clay and sand mining, construction stone, mineral fibers and composites, and non-metallic minerals all recorded year-on-year growth. Since the beginning of the year, the decline in ex-factory prices of building materials has continued to narrow, a trend that started in the second half of 2024, with clearer signs of stabilization emerging.

Prudent assessment of industry trends. 

Large-scale urban renewal projects and trade-in deals for building materials are expected to play a key role in supporting market expectations and stimulating demand. Market sentiment, competitive dynamics, and supply-demand relationships are likely to see some improvement. However, structural challenges within the industry persist, and the sector’s trajectory will largely depend on achieving a dynamic balance between supply and demand while fostering a healthy industry ecosystem. Additionally, fluctuating production costs remain a key factor influencing industry operations—coal prices continue to decline, while oil and gas prices remain volatile at high levels. Meanwhile, transportation costs via road, sea, and waterways remain elevated, exerting differentiated impacts on various segments of the building materials industry.

The overall outlook suggests that while the industry is showing signs of recovery, continued monitoring of macroeconomic policies and market dynamics will be essential to ensure sustainable growth.

Annotations：

1. Building Materials Industry Prosperity Index （MPI）mainly monitors the operation trend of building materials industry and has a strong function of prediction and early warning. When MPI is higher than 100, it indicates that the operation of building materials industry is in the prosperity range, and when MPI is lower than 100, it indicates that in the recession range.

2. The prosperity index of building materials industry (MPI) judges the operation trend of building materials industry from the supply side and demand side. The supply side is divided into price index and production index. The demand side is divided into investment demand index, industrial consumption index and building materials international trade index according to the actual impact of the demand field on the building materials industry.

3. The price index of building materials industry reflects the change trend of ex-factory price of building materials industry. The ex-factory price does not include the expenses, product profits and taxes incurred in the circulation of building materials products. The ex-factory price is different from the market price, for the changes of the two will affect each other and there is a time lag. There may be inconsistent change trends in a certain period of time.

4. The industrial production index of building materials reflects the change trend of industrial production of building materials, excluding price changes.

5.Investment demand index, reflecting the change trend of investment market demand related to building materials.

6.The industrial consumption index reflects the changing trend of industrial consumption demand related to building materials. Industrial consumption includes not only the internal and inter industry consumption of building materials industry, but also the consumption of building materials products by downstream industries.

7.The international trade index of building materials reflects the changing trend of international trade in building materials, which is mainly composed of export indexes of building ceramics and sanitaryware,  building technology glass, building stone, glass fiber and composite materials, non-metallic minerals and other industries.

Editor: Zhang Hanwen

Reviewer: Shen Yulu, Li Yuemei