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VietNamNews

Cement sector grows while steel market stagnates

Update: December, 28/2013 - 09:19

HA NOI (VNS)— The construction material sector has seen a rebound in cement and ceramic tile production, while steel and brick production remained stagnant.

Vice chairman of the Viet Nam Cement Association Hong Trong Kim said that the cement industry will meet the target of selling 56 million tonnes of cement this year.

With trade promotion methods succeeding in expanding the market, despite a price hike of VND80,000-120,000 (US$3.63-5.45) per tonne in the third quarter, the country's largest cement producer Vicem has expanded its share in the domestic market from 34 per cent in 2012 to 37 per cent this year. It has also enhanced exports to the Middle East and Africa.

Another large cement producer Fico also reported that it met this year's target by early December, with a total sales of 1.7 million tonnes of cement, earning it a turnover of VND2.2 trillion ($100 million) and a profit of VND50 billion ($2.27 million).

Deputy-general director of ceramic tile producer Viglacera Nguyen Minh Tuan said the company is also expected to earn a turnover of VND10.5 trillion ($477.27 million) this year. The company aims to achieve an export turnover of $75 million by 2015, a 25 per cent increase.

Not as optimistic as cement and tile producers, construction brick producers, especially small-sized ones, estimated that industry consumption will dip in 2013 as compared with last year and that the sector will not meet its annual target of selling 20 billion units of bricks.

The steel sector also faced difficulties this year due to decreasing demand in the wake of economic hardships.

Vice chairman of the Viet Nam Steel Association Nguyen Tien Nghi said that the sector sold roughly 4.6 million tonnes of steel this year out of 5 million tones of output. Of the 4.6 million tonnes, 2.5 million tonnes were exported.

Due to the low demand, steel producers had to cut prices by VND700 per kilo from the third quarter to boost sales.

Nghi forecast that it will be difficult for consumption to rise next year, adding that it will grow only around 2-3 per cent. Steel producers also plan to increase their exports to 30 per cent. — VNS


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