Myanmar cement firms prepare for building boom

Myanmar cement firms prepare for building boom
Published: 07 December 2012


LV Technology Plc (LVT) expects Myanmar's cement market to exhibit similar growth trend to Thailand's development path. The equipment supplier said: "There is massive potential for cement growth in Myanmar. The growth trends for the industry will be similar to Thailand, with more direct investments leading to higher demand," said Wisoot Anupunthumetha, an adviser for LVT.

Supervising LVT's business in Myanmar, Mr Wisoot said the first cement plant with production capacity of 200tpd was set up in Myanmar in 1935. Since then the cement business has moderately expanded but is still insufficient to meet demand, he said.

There are 14 cement plants in Myanmar with a combined capacity of 3.5Mta, while demand is 6Mta.
Myanmar imports 2 Mta of cement from Thailand, Indonesia and India, said a source at the Kanbawza Project, a new cement plant being built by LVT for KBZ Industries Ltd, a unit of the KBZ Group.

"Current domestic production is insufficient to meet cement demand, but much depends on the government's decision of how many plant permits it will grant," he said, adding the government is in the process of allowing 10 new plants to be constructed over the next two years.

Myanmar's per capita cement use is 70-80kg. Mr Wisoot said there is potential for per capita demand to grow to 200kg per year, equivalent to 10Mta over the next six to eight years.

"We found per capita demand of cement will peak at 600kg per year once economic development stabilises," he said. Over the next three to five years, cement consumption in Myanmar is expected to increase by 10-20% per year based on gross domestic product growth of 5.5% to 6%, he said.

LVT data shows the Myanmar Investment Commission has approved four new privately-owned cement plant projects with a combined capacity of 5250tpd, or 1.9Mta. Most of the cement factories in Myanmar use wet-process technology, but three of the new plants, for which construction has already begun, will utilise more efficient dry-processing.

The market price for cement in Myanmar varies between US$160/t to $200/t, which is high compared to other Asean countries, he said.