Cement sector finds firmer ground

June was the third consecutive month cement sales surpassed six million tonnes, bringing the total sold to 33 million tonnes for the first half of the year, a 10 per cent increase on-year.

Cement and clinker exports also showed positive results. In June alone nearly 1.4 million tonnes were shipped abroad.

According to Vietnam Cement Association chairman Nguyen Quang Cung, the improvement of the cement market is a sign that firms may be able to again run at full capacity and firms will be able to reduce their surplus inventories.

Chairman of state conglomerate Vicem Luong Quang Khai said cement plants in Vietnam ran at full capacity in the first four months of the year, sales then slowed in May-June but soon resurged, providing positive business results for the first half of the year.

Accordingly, Vicem sold more than 10 million tonnes of cement in the first half, at an average of 1.5 million tonnes per month, with 2.2 million tonnes exported.

Vicem Hoang Mai JSC (HOM), a Vicem member, also reported surging sales thanks to an improving real estate sector.

In the first five months the company sold 765,600 tonnes, up nearly 18 per cent on-year.

This helped the company reap profits of VND22.1 billion ($1.05 million) compared to a loss over the same period last year of VND40 billion ($1.9 million).

Its five month revenues leapt 21 per cent to VND767 billion ($36.5 million), tantamount to 60 per cent of its full-year target.

Another major player in the local cement industry, the Vissai Ninh Binh group, has six plants with a combined capacity of 10 million tonnes per year. It has already reached 55 per cent of both its production and consumption targets for the year, reported the company’s deputy general director Nguyen Vu Thanh.

“Our Vissai Lang Son and Vissai Ha Nam plants are seeking more workers to keep up with our production,” Thanh said.

Also of note is that Vicem and Vissai Ninh Binh’s exports have been thriving.

Firms have boosted their exports and sales considerably thanks to soaring consumption and Vietnam looks set to overtake its consumption forecast for the year by 3-4 million tonnes, with a new projection of 66-67 million tonnes, compared to 61 million in 2013 and 53.6 million in 2012.