The Ministry of Construction is mulling adding a number of new cement projects to the cement industry development plan as demand has been growing rapidly.
Nguyen Quang Cung, head of the ministry’s Construction Materials Department, said the cement industry’s 2006 sales grew over 13% YoY to 32.5Mt, half a million ton higher than forecast.
Demand is projected to continue to rise, so the ministry could allow more cement projects to get underway to scale up supply in the next few years, he said.
The Government recently approved the ministry’s proposals to add two new lines at Cong Thanh cement plant in the northern province of Thanh Hoa with daily output of 10,000 tons of clinker and the 10,000 tons clinker/day He Duong cement project in Ninh Binh Province, also in the north, to the industry development plan.
The ministry will have a meeting in HCMC on January 20 to find ways to stabilise the local cement market and prevent an undersupply that will lead to prices rocketing.
The southern market traditionally has sharp demand for cement in the first quarter and the Vietnam Cement Corporation now has more than 1Mt available in stock to prevent a possible shortage.
Cung predicted higher fuel costs would cause cement prices to be volatile this year. A decision by Vietnam National Coal and Mineral Industries Group to hike coal prices applicable to the four largest customers in the country, namely the electricity, paper, cement and fertilizer industries, will have an impact on the cement industry.
Last year cement prices rose by VND30,000 per ton to VND880,000 in the north and VND770,000 in the south. Cung forecast the similar growth in prices this year.