Aggregate Dredging and The Crown Estate — facts and figures
The Crown Estate published a report on 7th November revealing the levels of aggregate dredged from the seabed and the revenue resulting from this. In (SIC(2007): part of 08.12) it revealed that the production of sand and gravel by dredging offshore contributes more than 20% of the material used for construction in England and Wales and that there were ‘substantial exports’. In addition dredging supplies material for beach nourishment and regular contract fill, e.g. the Cardiff Bay Barrage and the Sizewell B nuclear power station.
The report states that the UK has the largest offshore dredging industry in Europe and one of the biggest in the world. Almost all dredging is done under licence from The Crown Estate, to which, as the major seabed minerals owner, the royalties collected for dredging are around £14m per year. In 2006 the total dredged was 24.3 million tonnes of which 13.4 million was landed at wharves in England and Wales for processing and use as construction aggregate; 6.7 million was landed at wharves on Continental Europe for construction aggregate whilst 4.2 million was used for beach replenishment and contract fill.
Based on 2006 production there are two figures for turnover. For that landed at the wharf (assuming £6 per tonne; BMAPA communication) is £146m out of the dock gate, and after processing (assuming £12 per tonne) it is £293m.
Prices in Continental Europe are about 30% lower than in the UK, and the value of beach recharge will be significantly lower than for processed material. Assuming the beach material is unprocessed and that all other material is processed, weighting according to the landed volumes for 2006 gives an estimated of turnover of £242m.
The Gross Value added can be roughly estimated using the combined use matrix in the UK Input-Output Tables for 2004, for the whole sector, at 0.47 of turnover. Hence, gross value added is estimated as £114m. Exports, based on the above calculations assuming the processed price of £12 per tonne are estimated at £56m.
The main area of offshore sand and gravel landings is the South East Region. One third of the South East region’ primary aggregate requirements come from marine sources. The 10 million tonnes landed in the South East represents 75% of total UK marine aggregate landings (13.4 million tonnes), and 40% of total UK marine aggregate production (24.8 million tonnes, including exports and beach/contract fill). Of the 68 wharves in England and Wales, 35 are in the Thames and at South East ports as a third of all UK construction takes place in the south east.
South Wales is uniquely dependent on marine-dredged sand which accounts for 93 per cent of the market for all construction sand and 97 per cent of building sand supply. There are currently no landings in Scotland or Northern Ireland.
The report gives the trends and potential for future growth, and says that the supply of marine dredged sand and gravel for UK construction has been remarkably stable since the early 1970s. In most regions the annual volume landed is much less than the maximum allowed under the licence terms. Large construction projects in the South East can increase consumption (for example the Channel Tunnel Rail Link, and prospectively, the Thames Gateway port development). It further says that the demand for exports is expected to grow as Continental land supplies become exhausted.
On the demand for beach nourishment. it reports that material used varies from year to year depending on what projects are currently being undertaken. As Climate Change may increase the demand for protection against coastal flooding may in turn call for more soft engineered defences.
The principle user of UK landed sand and gravel is given as the construction industry, which gets about 21% of its sand and gravel supply in England and Wales from marine sources. In 2005, 79% of marine aggregate landings were used in the production of concrete and concreting products. Overall in 2004 31,000 people were employed in the manufacture of concrete products for construction purposes, and of ready-mix concrete. In 2005 the construction industry accounted for 6% (£63bn) of the total UK GDP.
Aggregates 2006
- Turnover £242m
- Gross value added £114m
- Exports £56m
- Number employed 1,670
Sources:
- The British Marine Aggregate Producers Association (Mark Russell) www.bmapa.org
- The Office for National Statistics, Annual Abstract of Statistics, Table 22.19
- The strategic importance of the marine aggregate industry to the UK. Report prepared for BMAPA by the British Geological Survey 2007
