Displaying items by tag: decline

Pakistan: Lucky Cement disclosed a decrease in profit for the third quarter of the 2024 financial year, due to shrinking gross margins and a fall in cement sales, according to Pakistan Press International. The company's unconsolidated earnings decreased by 27% from the previous quarter. Gross margins narrowed from 36% to 28.8%, impacted by higher coal prices, increased power costs and a shift towards clinker exports which resulted in a 10% quarterly drop in cement sales volumes. Overall revenue declined to U$98.7m. Despite this, Lucky Cement's earnings over the first nine months of the fiscal year 2024 have grown by 67% year-on-year, supported by higher gross margins and increased income from higher interest rates and dividends from Lucky Cement Investments.

China: Beijing-based China National Building Material (CNBM) anticipates its first-quarter losses to increase by more than 50% to US$180m, up from US$72.6m in 2023. The company attributes the increased losses to lower selling prices for its key products, worsening performance of associates, and higher currency losses, despite a decrease in cost of sales. Following a meeting with CNBM, Citi analysts reported a 10% year-on-year fall in demand for the cement sector in the first quarter of 2024, with a forecasted full-year decline of 3%-5%.

Spain: Cement consumption has dropped by 10% in the first quarter of 2024, totalling 3.3Mt. This represents an 11% year-on-year decrease compared to the same quarter of 2023, according to the latest data released by Oficemen. The 2024 quarterly decline was influenced by a 23.6% fall in consumption in March 2024 to 1.1Mt, 339,869t less than March 2023. Over the last 12 months (April 2023 - March 2024), consumption fell by 6.4% to 14.1Mt, nearly 1Mt less than in the previous corresponding period of April 2022 – March 2023.

Oficemen general director Aniceto Zaragoza said "Aside from the situational circumstances of March 2024, the year-moving data reflect a negative trend, resulting from 10 months of decline. This is concerning but in line with our forecasts that anticipated a negative start to the year, with a modest recovery in the second half, provided that the international and local situation remains stable.”

Cement exports have declined by 25.1% in the first quarter of 2024, standing at around 1Mt. In March 2024, the decline was 32.4%, with a loss of 178,953t, marking nine months of consecutive declines. Over the year-moving period, the fall is 14%, with a total of 4.8Mt of cement exported. representing a loss of almost 800,000t less than in the previous 12 months.

Türkiye: Exports of cement products from Türkiye to the US have decreased by 12% year-on-year to US$165m from January - March 2024, according to the Türkiye Trade Ministry. The ministry also reported that in March 2024, cement exports to the US fell to US$57.5m, representing a 28% year-on-year decrease. Overall, Türkiye's global cement product exports dropped 7.4% to US$1.1bn in the first quarter of 2024. In March 2024, exports were down 11% at US$390m. Despite these declines, Türkiye achieved cement product exports totalling US$4.5bn from March 2023 - March 2024.

Vietnam: The Vietnam Cement Association (VNCA) has urged the government to address the cement industry's challenges, following a continuous decline in sales since 2022. Despite having 61 cement plants with a combined capacity of 117Mt/yr, the industry recorded sales of only 87.8Mt/yr in 2023, marking a 16% year-on-year fall in domestic consumption to 56.6Mt and a 1% decline in exports to 31.2Mt. The downturn in both domestic and export markets has resulted in excess inventory, leading many plants to reduce capacity or halt operations, with some facing bankruptcy or the risk of foreign acquisition.

Several factors have contributed to the industry's difficulties, including reduced domestic demand due to reliance on traditional construction techniques in major infrastructure projects, a stagnant real estate market, escalating fuel costs, and increased export taxes on clinker. To combat these issues, VNCA proposes promoting concrete use in high-speed infrastructure projects, especially in the Central region and the Mekong Delta. It also advocates maintaining or eliminating export taxes on clinker for the next two years and providing VAT exemptions. Additionally, VNCA calls for financial support, requesting banks to offer debt relief and reduced interest rates to cement companies. The association also advises against further foreign investment in Vietnam's cement sector.

Switzerland: Cement production fell to 786,000t in the first quarter of 2024, representing a year-on-year decrease in volume of 8%. Cemsuisse attributes this decrease to ongoing challenges in planning construction projects amidst uncertainties in interest rates, energy prices and supply chain stability.

France: Heidelberg Materials has announced plans to close two of its plants in France - Beffes and Villiers-au-Bouin - by October 2025. This move is part of the company's restructuring efforts aimed at accelerating its decarbonisation efforts and focusing more on low-carbon products.

The decision comes amid a decline in cement sales in France, attributed to weak demand in the construction sector. 170 employees are affected by the impending closures of these plants, according to the company.

These closures align with Heidelberg Materials' commitment to focus on lower carbon alternatives, enhance energy efficiency, increase the use of alternative fuels, and reduce the clinker content in its cement products in France.

Poland: The Polish Cement Association reported a 12% fall in cement production in 2023, with output reaching 16.6Mt, according to data from the Central Statistical Office. The decline reflects challenges faced by the construction sector amidst a slowing economy, despite a slight GDP growth of over 0.2%.

Zbigniew Pilch, chief marketing officer of the association, said "2023 was a difficult year for the construction sector as the economy slowed down while GDP grew by a little over 0.2%." The initial data for 2024 suggests a potential rebound in the Polish cement industry, however, with Pilch adding "In February 2024, cement production totalled 1.2Mt, which represents a 33% year-on-year increase.”

Spain: Cement consumption in Spain witnessed a 1.5% year-on-year decline in February 2024, marking nine consecutive months of decreases amid high interest rates, surging housing prices, and a stagnant outlook for the construction sector. According to Oficemen, February's consumption reached 1.1Mt, down from 1.2Mt in February 2023. The export sector experienced an even sharper fall, dropping 13.9% year-on-year in February 2024, continuing an eight-month decline, with a 9.8% decrease in exports from February 2023 to February 2024. Conversely, imports have risen by 11.3%.

Oficemen's general director, Aniceto Zaragoza, said “With nine months already in decline, the concern with which we observe the evolution of cement consumption and, of course, the construction sector, is accentuated.” Zaragoza called for increased collaboration between public and private institutions in public contracting processes to sustain infrastructure competitiveness. The slump in cement consumption, which has been ongoing since 2019, coincides with the European Central Bank's interest rate hikes, leading to higher mortgage costs and reduced demand in the housing market.