This report covers the market developments in FY 2013, January-September 2014 and the data available as of October 2014. The building materials market paralleled the negative y/y performance of the construction sector in 2013, yet in the second half of the year the situation started recovering and in January-September 2014 statistical indicators revealed that the construction sector returned on upward path. The decline in 2013 is partly on high base comparison (until end-June 2012 construction works peaked, ahead of the Euro 2012 soccer championship), but also explained by the completion of the EU-funded major projects. The construction materials sales value inched down by 0.8% y/y in 2013, but started recovering in Q1/2014, when sales improved at double-digit annual rate, according to market data. Building materials output also recorded cheering y/y performance this year, driven by rising demand coming from new investments financed from public funds and cohesion funds. In Q1 alone, cement and ready-mix concrete output surged by 53.1% y/y and 43.3% y/y respectively. The prospects for the building materials market are on the positive side, linked to the same expected performance of the construction sector. After two consecutive years of annual decline, the construction sector is expected to start recovering at sluggish pace beginning with 2014, propped by new EU co-financed projects and a projected revival of the building construction segment. Key points: • Construction output shrinks in 2013, but recovers in Jan-Sep 2014 • Construction materials output records cheering y/y performance in Jan-Sep 2014, after slow 2013 • Polish residential real estate market remains overall stable in 2013, H1/2014 • Plastic construction material producer Gamrat sells PVC flooring division • Nemex to spend €36.4mn on new factory • H+H Polska acquires Polish autoclaved aerated concrete producer Grupa Prefabet