This 2024 issue provides the latest information on the current supply-demand situation in Vietnam cement industry, covering industry data & operational information up to the first three months of 2024. This report also provides an in-depth analysis of key growth drivers, market outlook for 2024 and supply-demand forecast until 2030. Especially, the analysis of retail bagged cement prices for PCB30 and PCB40 by region, key brands and production cost are also included in this report.

Below are the most critical findings in our 10th issue:

1. Total clinker & cement sales in Vietnam decreased by 6.5% in 2023 due to the weak demand from both domestic and overseas markets. Total clinker and cement sales in Vietnam witnessed a decrease of 6.5% (y-o-y) to 86.0mn tons in 2023, resulted from the shrinkage of demand from both export markets and weak domestic consumption. In particular, cement domestic cement consumption decreased moderately by 9.0% to 56.6mn tons while total clinker and cement export activities fell slightly by 1.3% to 29.4mn tons. In Q1.2024, the slowdown continued with a contraction of 6.2% (y-o-y) and 2.7% (y-o-y) for domestic and export markets, respectively.

2. The surge in designed capacity for clinker & cement in Vietnam is forecasted to continue in the next 3 years with new facilities by private cement manufacturers despite a gloomy market outlook. In particular, there are two new facilities starting commercial operation in 2023, posting an increase of 1.9mn tons in clinker production capacity and 3.3mn tons in cement production capacity. The average utilization rate of Vietnam cement industry declined from 58% in 2022 to 55% in 2023, resulted from weakened demand and the commercial launch of the new 2 facilities in the year.

3. Local private players continued to dominate the Vietnam cement market in 2023 with a over 48% of the total market share. Local players accounted for over 48% of market share by domestic cement sales volume in 2023 with big names including Long Son, Vissai, Xuan Thanh, Cong Thanh & Thanh Thang. Meanwhile, leveraging strong brand position, VICEM and selected foreign players such as SCC-VN, Nghi Son and SCG managed to achieve a high average utilization rate in 2023.

4. The profit margin of listed cement manufacturers declined in 2023. It could be explained by (i) the low utilization rate given the oversupply situation in Vietnam’s cement market, (ii) weak demand from both domestic and export markets, and (ii) new export tax from the government in clinker since 1^st Jan 2023, despite the stablization of import coal prices during 2023. FiinGroup forecasts that profit margin of Vietnam cement manufacturers shall keep facing continuous challenges in the times to come including low utilization rate, and a downward trajectory in demand from the China market.
5. In 2024, the domestic cement demand is predicted to trend downward, whereas there are positive signs for export in the year. The negative outlook of the domestic market could be explained by low public investment disbursement despite high target from the Prime Minister. On the other hand, the positive outlook of export markets could be attributed to solid demand from Philippines, Bangladesh and other new markets including the U.S. and Singapore.

In 2024, the domestic cement demand is predicted to trend downward, whereas there are positive signs for export in the year. The negative outlook of the domestic market could be explained by low public investment disbursement despite the high target from the Prime Minister. On the other hand, the positive outlook of export markets could be attributed to solid demand from Philippines, Bangladesh and other new markets including the U.S. and Singapore.