Vietnam stops licencing new cement projects

Vietnam stops licencing new cement projects
Published: 08 June 2007

The Prime Minister has asked the Ministry of Construction to examine the implementation of licenced cement projects and halt licencing new cement plants.

The Prime Minister has also asked for the acceleration of the implementation of projects which have been approved, and for capacity surplus to be avoided to ensure the effective development of the cement industry.

Predictions on the demand and supply of cement say that cement supply and demand will be in balance by 2009. Total cement output may be in excess in 2010 and 2011.

It is estimated that with the current growth rate of cement demand at 11%, Vietnam will need some 50Mt of cement by 2010, while the total designed capacity of the industry’s current plan is 60Mt.

By the end of May 2006, Vietnam had the total designed capacity of 24.7Mt of cement. 30 cement projects are being implemented which have the total capacity of 35Mt.

In a recent report on the evaluation of cement projects, the Ministry of Construction acknowledges that a surplus of cement output may occur if considering the designed capacity. However, the ministry has also stressed that supply and demand will depend on the pace of project implementations. One or two slow projects will be enough to negatively impact supply and demand.