Crown Estate Socio-Economic Report on Marine Aggregate Dredging

On 6th November 2008 the Crown Estate published a new report on the levels of marine dredging, the staffing of the industry and the financial contribution derived and resulting from the activity.

The production of sand and gravel by dredging offshore contributes more than 20% of the material used for construction in England and Wales. There are substantial exports. In addition dredging supplies material for beach nourishment and regular contract fill (for example Cardiff Bay Barrage, and Sizewell B nuclear power station).

Most processing takes place at the landing wharves. 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, which is the major seabed minerals owner: royalties collected for dredging are around £14m per year.

Turnover In 2006

The total dredged was 24.3 million tonnes of which 13.4 million was landed at wharves in England and Wales for use as construction aggregate; 6.7 million was landed at wharves on Continental Europe for construction aggregate; and 4.2 million was used for beach replenishment and contract fill. Based on 2006 production there are two figures for turnover.

Landed at the wharf

Assuming £6 per tonne; BMAPA communication is £146m; Out of the dock gate after processing (assuming £12 per tonne) 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.

Gross Value Added

This 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 £12 per tonne, these are estimated at £56m.

Numbers employed

The fleet of some 27 marine aggregate dredgers has about 475 staff and there is also 140 management staff. The wharves in the UK employ a further 500 people (140 on the Continent) for operations and processing. A further 544 are employed as UK hauliers delivering to the point of end use (160 on the Continent). Excluding the continental employees, the total is 1,670.

Activity by region

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. A third of all UK construction takes place in the south east, where marine aggregate supplies are so significant. 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.

Trends and potential for future growth

The supply of marine dredged sand and gravel for UK construction has been remarkably stable since the early 1970s. See Figure 6. In most regions the annual volume landed is much less than the maximum allowed under the license 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). Demand for exports is expected to grow as Continental land supplies become exhausted. Demand for beach nourishment material varies from year to year depending on what projects are currently being undertaken. Climate change may increase the demand for protection against coastal flooding, which in turn may call for more soft engineered defences.

Related impacts / consequences in the UK economy

The principle user of UK landed sand and gravel is 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


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