The Chinese cement industry posted gross margin of 16 per cent and net profit margin of 7.83 percent in the first 11 months of 2010. Gross margin in the first eight months was 14.9 per cent.
According to local reports, the increase in the gross margin was mainly due to greater cement demand during the August-November period and reduced output.
Anhui, Hainan, Guangxi and Zhejiang provinces were affected by a reduction in power supply, which resulted in lower production volumes in these places.
According to Ma Jing, an analyst from Bohai Securities, the growth in infrastructure and real estate investments now guarantees stable profits for the cement industry.
The price of cement was Yuan 420/tonne in the first three weeks of December, up 5.92 per cent month-on-month. Prices in the eastern and south-western areas increased the most during this period. The price of cement in eastern China rose 22 per cent month-on-month.