Vietnam overcapacity to worsen in 2012

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Vietnam: The Vietnamese cement industry continues to suffer the effects of overcapacity and is struggling to export enough cement. The industry faced many difficulties in 2011, in part due to its stagnant real estate market. In 2012, however, eight new cement plants will go into operation with a combined capacity of 6.9Mt/yr. This will bring the total capacity of the country to 73Mt/yr, worsening the oversupply situation.

According to the Vietnamese Cement Association, the total demand for cement in 2012 will be about 60Mt/yr, of which 53Mt/yr will be for domestic consumption. Currently cement is exported to China, India and a number of Asia Pacific nations. Africa is also becoming a promising market. While China is reporting soaring consumption, India itself is facing overcapacity as demand weakens, threatening this export market for Vietnam.

Vietnam currently faces difficulty in supplying cement overseas. Its domestic infrastructure is poor and input costs, like those around the world, are increasing. There is also a poor perception of Vietnamese cement exports, which may be damaging trade.

Last modified on 01 February 2012


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