Vicem to boost exports

Last month Vietnam’s Ministry of Construction asked the peoples’ committees in five cities not to approve any more cement plant projects until 2020 because of ample supplies. Approvals for new cement plants in Hanoi, HCM City, Hai Phong, Da Nang and Can Tho were not granted. Vietnam’s press agencies are now reporting that, as a result of concerns that the current cement surplus could lead to harsh competition on the domestic market, the Vietnam Cement Industry Corporation (Vicem) intends to increase its exports to 1 million t this year.

Vicem’s general director Nguyen Ngoc Anh has said that the corporation is due to add six or seven new production lines, thereby increasing total output to nearly 20 million t. This year alone its total output will be 19 million t, of which 1 million t are earmarked for export. In preparation for the export drive the corporation has been on fact-finding visits to potential markets including Cambodia, Laos and China. Over the past five years the corporation’s subsidiaries, including Cam Pha, Hoang Thach, Ha Tien and Hoang Mai, have exported products to Africa, the Middle East and Cambodia, but volumes have been insignificant.

The Vietnam Cement Association has forecast that this year’s cement demand could surge by about 4–5 million t to 48-50 million t, and if all cement plants were running at full capacity there would be a surplus of some 10 million t. It is expected that 13 new cement production lines will begin production this year and 12 new lines next year adding a further 9.35 million tpa. One of the new lines will be the 12 000 tpd one at the Cong Thanh Cement plant in Thanh Hoa Province, reported to be the largest single one in Asia to date, and scheduled to begin full production in 2011.

In addition to the markets being explored by Vicem, the Ministry of Construction is citing Bangladesh, the Middle East and Africa as potential export markets. However, experts are warning that cement exports may not bring attractive returns due to high transportation costs, while increasing electricity and coal costs may also affect prices.

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