2016 cement sales goal in doubt

Industry insiders are concerned the cement industry will find it hard to meet the target of selling 75-77 million tonnes of cement this year due to market difficulties.

The cement industry has to sell at least 20 million tonnes in the last quarter to meet the annual sales target of 75-77 million tonnes-Photo ximangfico.com

The target is up 3.2-6 per cent against last year.

To meet the target, the industry has to sell at least 20 million tonnes in the last quarter, or seven million tonnes per month.

Viet Nam Cement Association Chairman Nguyen Quang Cung said it would be hard to meet the target as sales of the product in the domestic market this year rose insignificantly while exports decreased.

Representatives from a cement production company who declined to be named said sales of cement currently faced many difficulties, explaining that domestic cement supply is exceeding demand.

According to statistics from the Ministry of Construction, in the first nine months of this year, the industry sold 55.25 million tonnes of cement.

Of the total, roughly 43.55 million tonnes were sold in the domestic market, up 7.7 per cent against the same period last year.

However, exports of cement and clinker in the period declined by some 2 per cent year-on-year to 11.7 million tonnes. Industry insiders attributed the decline to fierce competition with products of other producers from Thailand and China.

Viet Nam is currently ranked the world's fifth largest cement exporter and the first in the Southeast Asia region, however, the country's export volume is, in fact, much lower than Thailand's.

Thai cement is more competitive than Viet Nam as it has many traditional customers, besides advantages in transport and good quality.

Viet Nam is also finding it difficult to compete against China as its cement factories, whose design capacity exceeds the demand of some 670 million tonnes - equal to roughly eight times Viet Nam's total cement design capacity - which is why they often sell their products at low prices.

Source VNS