According to the Vietnam cement industry report of the Building Materials Department (Ministry of Construction), cement consumption was estimated at 8.87 million tons in March 2021 alone, up 1.5% over the same period in 2020. In which, domestic consumption was about 5.02 million tons. Of the domestic consumption, the Vietnam Cement Industry Corporation (Vicem) consumes about 1.83 million tons of cement. The export output was estimated at 3.85 million tons.
Accumulated in the first quarter of this year, the estimated consumption of cement was about 22.31 million tons, increasing by about 1.5% over the same period in 2020 (The targeted plan of cement consumption for the whole year is from 104 to 107 million tons of cement products). In which, consumption in the domestic market was about 12.16 million tons (Vicem's consumption was about 5.08 million tons alone). The cement export was estimated at 10.15 million tons.
Also, according to the Building Materials Department, the selling price of cement in the domestic market in March 2021 was more stable than that of February, while the export price increased slightly. The amount of in-stock cement nationwide in the first three months of 2020 was about 4.6 million tons, mainly clinker, equivalent to about 20 to 25 days of production.
In the past year, construction activities in the country were less active than in other years due to the impact of the COVID-19 pandemic. In particular, the segment of accommodation and hotel construction and industrial construction has seen negative signs. This explains the decrease in cement consumption in the domestic market.
According to Mr. Nguyen Quang Cung, chairman of the Vietnam Cement Association, although the long-lasting COVID-19 pandemic throughout the year 2020 caused the domestic consumption of cement in the domestic market to decrease by 3 million tons compared to 2019 and many investment projects to be delayed, most of the production and business targets of cement enterprises were not reduced.
In 2020, the total production output of Vietnam's cement industry reached over 101.5 million tons, a slight increase of 1.5% compared to 2019. The consumption reached approximately 100 million tons, of which, the domestic market absorbed 62 million tons, down 3 million tons compared to 2019. However, exportation was maintained and promoted well, with the total export turnover of cement in 2020 reached a record of 38 million tons, increasing by 10% compared to 2019.
It can be seen that the overall situation of the cement industry still has had positive signs when most of the leading enterprises in the market have accomplished their business goals last year.
Experts in the building materials industry state that, in the context of the COVID-19 pandemic effectively controlled in Vietnam along with the restart of real estate projects, construction as well as general recovery of the economy, the production and consumption of cement products are expected to continue to increase in the next months.
According to the analysis of SSI Securities Company, in 2021, the profit margin of the cement industry may be reduced due to increased capacity and fuel costs. The capacity of the cement industry is expected to decrease by about 6% this year, and the export channel will not grow as easily as in 2020. Although the market has no room for strong growth, the goal of growth is still the central task of leading enterprises of the market.
Compiled by VietnamCredit