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[FiinResearch] - VIETNAM CEMENT MARKET REPORT 2021

May 28 2021

FiinGroup

 

FiinGroup is pleased to introduce Vietnam Cement Market Report 2021, the first and most comprehensive issue on Vietnam cement industry. This report presents a board range of topics, both sector-specific and crosscutting market issues.

What’s New? Vietnam cement industry expanded by 0.9% in 2020, mainly driven by buoyant clinker and cement export activities while domestic sales recorded deceleration due to negative impact of COVID-19. Given weakened domestic demand & the rise in fuel cost, listed cement manufacturers recorded a deteriorated average EBITDA margin from 17.0% in 2019 to only 15.8% in 2020.

This 2021 issue provides the latest information on current supply – demand situation in Vietnam cement sector, in-depth analysis on key growth drivers, outlook for 2021 as well as forecast analysis until 2030. Especially, the analysis on retail bagged cement price for PCB30 and PCB40 by region and key brands is also included in this report.

Below are the most critical findings in our eighth issue:

  1. Domestic cement consumption reached 62.1 million tons in 2020, declining by 5.6% (YoY) due to negative impact of COVID-19. By region, sales volume in the North and the South contracted by 8.2% and 6.5%, respectively, while Central recorded a slight increase by 1.8% thanks to the rebuilding and reconstruction after the heavy storms in the summer of 2020 and a boost in construction of industrial parks in the region.
  2. Clinker and cement export volume continued strong growth momentum a surge by 14.9% (YoY) in total export volume in 2020. The market is driven by high demand from “traditional” export markets including China and the Philippines as well as Vietnamese cement manufacturers’ effort to tap on new markets.
  3. Despite supply surplus situation, leading local private cement manufacturers continue to develop new facilities aggressively amid COVID-19 to meet demand from overseas market. Particularly, many expansion projects developed by local private groups including Vissai, Long Son, Thanh Thang, Fico-YTL and SCC-VN are expected to launch the commercial operation in the next 5 years, boosting Vietnam production capacity up to 149.3 million tons of cement per annum by 2025.
  4. Local private manufacturers continued leading the market, accounting for 41% of market share by domestic cement sales volume in 2020. VICEM and leading private players such as Vissai and Long Son recorded a good performance with full utilization rate of 100% in 2020 while foreign-owned players’ figure slumped to 65% in 2020.
  5. Vietnam cement sector witnessed deteriorated profit margin due to the rise in fuel cost and low domestic cement consumption. Listed cement manufacturers recorded a deteriorated average EBITDA margin from 17.0% in 2019 to only 15.8% in 2020. This could be explained by a slump by 6.3% in net sales due to low demand in domestic market and a surge by 20% in coal price (which is driven by rising demand from China and reduction in production of major suppliers such as Australia). In addition, given fierce competition due to low demand, cement manufacturers spent higher marketing & selling expense to boost sales, contributing to lower EBITDA margin for the year 2020.
  6. Domestic cement market in Vietnam is forecasted to have neutral outlook in 2021 while cement and clinker export is projected at positive outlook thanks to high demand from overseas buyers and local manufacturers to explore new markets.

More information as well as table of contents, report preview, and contact person can be found HERE

You can also check out other reports covering key sectors of Vietnam including Cold Chain, Consumer Finance, Banks, Healthcare, Housing Builders, and Plastic etc. on our website: http://fiinresearch.vn/   

If you would like to obtain the full contents of this Report, kindly direct your request to Ms. Nhung Nguyen, our Client Advisor at: nhung.nguyenhoai@fiingroup.vn


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