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Some outstanding issues in cement industry recent year

2018 is the great year of Vietnam’s cement industry. Hereafter we will review some outstanding issues in cement industry recent year, besides strengthen, there are still weakness.

Export gain record

To finish 2018, Vietnam’s cement industry can gain export capacity of 33 Mt, value 1,2 billion USD. This is the first time in history, cement export exceed 1 billion USD, because of China’s reducing of capacity and China becomes importing country from Vietnam.

According to experts, however, cement export has pros and cos. At the present, it can be domestic production, but for a long time, it will not be a sustainable solution. Cement industry is non-renewable materials exploiting sector, numerous export will lead to exhausted materials, especially, in price squeeze, low benefit scene.

Sustainable domestic market

In 2018, domestic real estate market is still stable development, there are many projects which are executed and has good disbursement, so cement industry is gotten profit from it.

Numerous public project is executed so domestic market develops well with the growth about 10%. Total expected domestic consumption is over 63 Mt, increasing total production volume of whole sector up to 96 Mt.

For a long time, domestic market is still sustainable market with 100 million people and country is developing stably, especially, the trend of transfer investment from China to Vietnam because of impact of trade conflict between  America and China. Cement companies should concentrate on brand development in order to control domestic market.

Cement industry get benefit due to 0% of tax.

Though this policy was announced at last 2017, but actually export companies get benefit in 2018. This promotes export strongly to help plants which is meet lots of difficulties in 2017, will step up export in 2018 to overcome difficulties so that they can have sustainable production.

Especially, last 12th December 2018, the Ministry of Construction had official correspondence of confirming that clinker is not mineral resource to the Ministry of Finance. This also solves problems of taxes and custom for cement industry.

Concentrating in sustainable development

2018 is the year that marked the changing of awareness to shift forward to sustainable development of many cement companies. They continuously study and conduct projects of installing thermal exhaust gas generator system, especially, they aware clearly the efficiency of this installation.

Series of plants start to concentrate in review,  energy audit of production line in order to have crucial adjustment methods.

Change technology, increase quality, decrease cost

Facing with the cutting down cost for competition, many plants had improved burning technology, grinding technology to decrease fuel consumption, save energy.  Many plants can increase rate of grinding additive up to 35-40%, but cement still meets standard and other technical specifications

This helps the plants decrease cost by reducing consumption of materials such as coal, power, reducing exploiting of limestone, clay in order to protect non renewable materials.

Low labour productivity

Besides the advantages, cement industry still has weakness as low labour productivity. This issue is stated by Cement Association in many times.  This is the main point for cement industry organizes structure.

Cement is sector that can be automatical highly, but the number of workers is large, especially, for companies which are stated-own. Labour is fluctual, not sustainable. This lead to management of conducting strategy is not long- term and sustainable.

Management still has shortcomings

Besides, there are many companies which update new management knowledge very slowly. Due to concentrate in business and production, there is few change to study, enhance level, apply modern and advance management methods, leading to inefficiency management.

Some companies own modern production line but management committee is not professional, business-production process is not suitable and effective that lead to sluggishness and be in deep debts in many years.

In competitive scene, effect of 4.0 revolution, companies have to adjust in management necessarily, remove oldest methods, update new methods… these are main factors to exist and develop in the future.

Not concentrate in controlling environmental pollution

Concerning to awareness and management, many companies do not control waste gas emission in to environment. Continuously, there are many companies break environmental protect element which are againsted by citizens, even suspended to overcome by authorities.

Environment is always sensitive element in cement industry. If companies want to be sustainable development, they have to guess risks which can be happened and affect to surrounding of citizens and intervened by authorities.

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Updated by Cost Solutions.