Cement industry gets back on track

08:13 | 12/06/2015 Industry

The Ministry of Construction has forecast that sales of cement and clinker in Vietnam will jump on-year by up to 4% to 74 million tonnes in 2015, of which domestic sales will be 54 million tonnes and exports 20 million tonnes.

Cement industry gets back on track

In line with the forecast, the latest figures released by the Vietnam National Cement Association (VNCA) show that in the four months leading up to May domestic sales of cement jumped 3% year-on-year to 15.89 million tonnes.

For the month of April alone the VNCA statistics indicate that sales of cement shot up 113% on-year to 5.45 million tonnes, which represents a month-on-month increase of 28%.

However, during the four-month period actual production was estimated at 30.22 million tonnes— far outpacing sales resulting in higher inventory stockpiles, the VNCA reports show.

The VNCA reported the overproduction resulted from an unanticipated slowdown in domestic construction during and following the TET Lunar New Year holiday, which they say is inconsequential.

Le Van Toi, head of the Ministry of Construction’s Building Material Department agrees with the VNCA and is not deterred on the prospects for the industry throughout the remainder of the year.

The nation is experiencing an upturn in residential and commercial construction that will spill over and produce a vibrant cement market throughout the remainder of 2015, Toi said.

Meanwhile statistics from the Ministry of Construction seem to support Toi’s optimism as they show that for the January-April period, new residential construction in the two big markets of Hanoi and HCM City was up over threefold that of last year.

In southern region, FiCO Tay Ninh cement joint stock company (TAFiCO)’s cement consumption reported its sales were up 1.19% compared to the same period last year, while in the north, Vinacomin reported its sales rose 10%.  

Vietnam businesses in the industry are also seeking ways to implement better quality controls and expand sales markets both at home and abroad in addition to constructing new cement plants.

Hoang Canh Nguyen, General Director of TAFiCO, said the company targets to develop its trade name, increase the quality of products, boost flexible policy of selling goods and push services after sale in order to increase its competitiveness.

After traditional markets, the company aims for enlarging export markets in the coming time. Now the company is pushing to produce high-quality products to key markets such as Cambodia and Myanmar at about 10 tonnes per month.

The figure is expected to be higher in the future.

TAFiCO has been preparing to commence construction of two new cement plants, which will raise the company’s total production capacity to 3 million tonnes of cement annually.

When these plants are placed into operation, the company will be better positioned to meet the demand for high-quality products in both the domestic and international markets, Nguyen added.

In the near future, the real estate and building material markets will be busier with many new projects set to begin construction.

According to Savills Vietnam, from now until the end of 2015, the Hanoi residential real estate construction market will need cement for 14,000 units in 22 projects.

HCM City also shows signs of recovery./.

Source VOV News


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