Bangladesh to be a bright spot for cement demand

The Bangladeshi government is actively seeking to improve national construction through a combination of building new roads and upgrading existing activities. Public-sector infrastructure projects currently account for 35% of the country’s total cement consumption.

“Time will tell if Bangladesh will be able to deliver on these ambitions, so there is some downside risk” said Robert Madeira, CW Managing Director and Head of Reseach. “Nonetheless, it is clear that much remains to be done in terms of construction in the country. The long-term cement demand story is clearly there.”

With only on integrated cement plant and a shortage of limestone reserves, Bangladesh is largely dependent on clinker imports to feed its cement demand. Clinker is mostly sourced from China, Thailand, Vietnam, and Malaysia.

“It is rare for such a large cement market to be almost entirely dependent on clinker imports for cement production,” said Raluca Cercel, CW’s Senior Consulting Analyst. “Hence the Bangladeshi cement market is highly susceptible to fluctuations of clinker supply and prices.”

According to Cercel, cement production facilities are also faced with inconsistent power supply, forcing most to build their own captive power supply in order to guarantee supply to their grinding facilities.

Despite this, the cement market “has continued to thrive, and is expected to continue doing so in the coming years,” concluded Cercel. CW Research forecasts cement demand to reach over 35 million t this year.

Read the article online at: https://www.worldcement.com/indian-subcontinent/02062017/bangladesh-to-be-a-bright-spot-for-cement-demand/