Cement prices in China rose to record high levels as mandatory energy curbs affected production. The average price of cement in China has reached CNY400/t (US$60), and in some regions, such as the east of the country, the price recently rocketed to CNY500/t.
Shandong Shanshui Cement Group, the largest cement producer in Shandong province, China’s largest cement manufacturing region, said it has had to increase prices seven times within a month to CNY420/t from CNY340/t, a rise of 25 per cent.
"The soaring prices are mainly due to a supply reduction caused by power restrictions," said Liu Zuoyi, deputy secretary-general of the China Cement Association. Adding to the problems is a shortage of diesel, which has affected transportation and cement deliveries, Liu said. The fourth quarter is usually the peak period of cement supply, but the current shortfall is likely to continue over the next month, and prices are expected to remain at high levels, analysts said.
However, Chinese cement prices are expected to fall in the first quarter of 2011, as production rebounds following the end of the government restrictions on power consumption, analysts said.