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Vietnam expected capacity of cement is 90 Mt in 2019

 According to Global Cement, up to December of 2018, China will become largest cement manufacturer in the world with capacity of 1.484 Mt/y, next is India and Vietnam with 437 Mt/y and 148 Mt/y relatively.

Athough China’ cement industry is facing with reducing capacity of cement, predicted capacity of this country which have largest population in the world is still 200 million tonnes higher than these of other 9 countries. 

According to statistic, Vietnam has total 74 cement plants, mostly controlled directly or indirectly or owned by Government. Actually, the plants do not operate in high capacity as installation, but Vietnam’s production capacity is still quite high and there is excess supply several recent years.

             

 

                 Installation capacity (t/y) of the top countries ( Source: Global Cement, VDSC)

Vietnam’s cement production is increasing rapidly in capacity as well as in the number of companies participating in this sector. Considering about total reality capacity, Vietnam produced 78 Mt in 2017, this figure increased up to 83 Mt in 2018 and expecting, total production capacity of plants will reach nearly 90 Mt in 2019.

Production capacity is increasing highly, while demand is low, so it makes sector be excess supply. According to Vietnam Cement Association (VNCA), whole country will face with excess of 26 Mt in 2017.

The idea solution for excess supply is export, and the largest market is China, when this country has decided to reduce 10% domestic capacity in 2018.

Only in the first 10 months in 2018, export value of Vietnam’s cement reach high volume in over past 4 years, up to 1,1 million USD and continuously increasing in the latest 2 months in 2018.

           

 

          Value of clinker & cement export (USD) ( Source: General Directorate of Custums, VDSC)

Up to mid of November of 2018, China is largest importer of Vietnam’s cement industry with more than 7,6 Mt and the value reach over 276 million USD. Bangladesh rank second with import mass of nearly 6 Mt. 

In Southeast Asia, Philippines has imported 5,5 Mt cement of Vietnam in the first 10 months in 2018.

Average price is changed to comply with each partner country. The Southeast Asia Countries are importing with highest prices. Specifically, Cambodian is importing cement of Vietnam with 51,6 USD/t and Philippines with 46,4 USD/t. China with strong negotiation , just to be paid 36,3 USD/t.

             

 

Export value and capacity according to other countries, export prices on average to other countries (USD/t) (source: General Directorate of Customs (VDSC)

Formerly, in March 2017, China has concern about reducing 10% capacity of coal, steel and cement to control air pollution. Further more, China make plan of banning expanding capacity of heavy industrial sector, including cement industry in 2018. Therefore, Vietnam Cement will be increased to selling for China.

Published by ximang.vn

Updated by Cost Solutions

 

     

 

 

 

              

 

 

 

 

 

 

 

 

 

 

 

 

 

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