The protracted political crisis in Thailand is impacting the domestic construction market, and cement consumption is expected to grow at half the rate expected, according to President and CEO of Siam Cement Group.
"The overall market of cement and construction materials has shrunk over the past couple of months thanks to the sluggish economy which has been hit by the prolonged political problems,'' Mr Kan told the Bangkok Post. "Earlier we forecast the two industries should increase by 8-9 per cent this year, but now we see they would grow at best at 4-5 per cent."
According to Mr Kan, the cement and construction materials fell 7-8 per cent during January and February against 4-5 per cent growth it projected earlier. Normally these months fall within the peak sales period, which spans December to April.
Cement and construction materials are expected to be hit hardest in the second and fourth quarters of the year, as construction and real estate activity slows down in line with the weakening economic outlook and lack of new private investment, which is being hampered by failure of the Board of Investment to issue project licenses and approvals.
Nevertheless, Mr Kan said he remains upbeat that SCG's sales revenue would grow by at least 10 per cent this year from THB434bn last year.
Domestic sales are expected to make up for 65 per cent of the group's sales revenue this year, with overseas sales contributing the remaining 35 per cent, 20 per cent of which will come from Asean markets.