According to Viet Nam News, cement producers in Vietnam will prioritise the increase of exports in 2014 in order to alleviate the country’s surplus supply of cement, brought about sluggish demand and tough market conditions.
Recent statistics from the Ministry of Construction revealed that Vietnam’s total cement output was more than 70 million t in 2013. Approximately 61 million t of cement was sold in domestic and international markets, an increase of 14% y/y. Furthermore, the country produced 4.8 million t of cement in January 2014, a 3.2% y/y rise compared to January 2013, according to data released by Vietnam's General Statistics Office. Vietnam is anticipated to experience surplus supply of approximately 8 – 12 million tpa as five additional cement production lines, with a total designed capacity of more than 7 million tpa, are due to be put into operation in 2H14.
Despite the domestic construction material market showing indications of recovery after two years of sluggishness, considerable improvements in purchasing power cannot be expected. Vietnamese cement manufacturers face major economic challenges such as a slowdown in the property market, a rise in input costs, high interest rates and exchange rate fluctuations.
Dao Ngoc Binh, General Director of Vietnam Cement Industry Corporation (VICEM) Hoang Thach, told Viet Nam News that many cement producers had turned to boosting exports as a result of tough competition in the Vietnamese market. Meanwhile, Tran Viet Thang, General Director of VICEM, commented that the country's cement exports reached 14 million t in 2013, with Vietnam’s two main export markets being Southeast Asia and the Middle East.
Edited from various sources by Rosalie Starling