China cement industry update

Production

According to the National Development and Reform Commission, China saw a 9.2% y/y increase in cement production in 2013, reaching a total of 2.2 billion tpa. Cement inventories at major producers witnessed a 7.5% decrease y/y, totalling 15.45 million t at the end of November 2013.

Revenue and profit

As reported by The China Perspective, data released by the National Bureau of Statistics stated that revenues for the cement sector rose by 7.7% y/y to ¥780.5 billion in January – October 2013. Net profits also saw an increase of 21.5% y/y to ¥53.3 billion for the same period. Earnings for FY13 were predicted to reach ¥80 billion.

Cement prices

Cement prices in China remained flat at the beginning of January 2014. Companies such as Anhui Conch Cement Co., Jiangxi Wannianqing Cement Co. Ltd, Hubei Cement and Guangdong Cement are planning to implement stricter capacity regulations while others, such as Jiangsu Cement, Zhejiang Jianfeng Cement Ltd, Shandong Shanshui Cement and Sichuan Yadong Cement Co. Ltd, may halt production for over a month.

Environmental

In line with the government’s crackdown on air pollution in heavy industries, new cement manufacturers will have to comply with stricter environmental regulations from March 1 2014. Existing cement producers will have to exercise the same restrictions as of June 2015. Currently, particulate matter coming from the cement industry is responsible for 15 – 20% of the country’s total particulate emissions. Nitrogen oxide and sulfur dioxide emissions from the sector account for 8 – 10% and 3 – 4%, respectively, of China’s total output for each of the emissions.

Edited from various sources by Rosalie Starling

Read the article online at: https://www.worldcement.com/asia-pacific-rim/08012014/china_cement_industry_update_569/