Despite the recent price correction, China Resources Cement Holdings Ltd, a unit of China Resources (Holdings) Co, said it expects that buoyant demand for cement and concrete on the mainland will remain for the rest of the year due to economic growth and fixed asset investment (FAI).
The company also reported on Monday that its net profit for the first half to June 30 more than doubled to HK$2.05bn.
Zhou Longshan, chief executive officer of China Resources Cement, said he expects cement prices to rise another 15 to 20 percent for the rest of the year, as the fourth quarter is traditionally the peak season for cement sales, and power shortage in provinces such as Guangxi will stoke prices due to a lack of supply.
Building materials, according to China Resources’ Zhou, showed strong upward momentum in selling prices in the first half. Prices of cement, clinker and concrete rose 21.2 per cent, 19.4 per cent and 16.5 per cent to HK$371.7, HK$301.5/t and HK$348.0/m3 respectively for the first six months in 2011 over the same period a year earlier.
The company sold a total of 19.4Mt of cement, 2.3Mt of clinker and 6.2Mm3 of concrete during the first half of 2011, representing YoY growth of 75.5 per cent, 35.2 per cent and 44.8 per cent from last year.