Domestic cement sales in Japan fell 11.6 per cent on the year to 3.51Mt, extending the extent of its decline to 34 months, the longest in history, the Japanese Cement Association reported.
The previous record was a 33 month run from 2002 to 2004 when then-Prime Minister Junichiro Koizumi slashed public works.
“We don’t see capital investment coming and the YoY losing streak will continue in the fiscal first half,” an association official said. The revised building standards law and the financial crisis have taken their toll on the cement industry.
In response, Taiheiyo Cement and other producers are scaling back capacity. Sumitomo Osaka Cement Co, the second largest domestic producer, is the most recent company to announce cuts in capacity, saying it will reduce output 20% by the end of September.
Sumitomo Osaka Cement is also looking at reducing its cement transport tankers from the current 19 and possibly eliminating some of its 66 distribution sites. It intends to decide on streamlining plans by the end of May. The firm’s facilities operated at 70% capacity in fiscal 2009.
By overhauling facilities and reducing production capacity, it aims to operate at 90% capacity.