Anhui Conch - April 2019

Anhui Conch’s impressive 88 per cent YoY leap in profits last year is being attributed to China’s crackdown on polluting industries, including steel, coal and cement. The crackdown resulted in a reduced supply of cement in the country, boosting the price of the commodity by around 22 per cent to an average of CNY427/t (US$63.56/t). Despite the squeeze on supply, investment in construction remained stable, expanding by 9.5 per cent in 2018, according to Caixin Global.

The Chinese cement sector is now expected to see a period of consolidation with the larger producers enjoying the uptick in prices while the smaller players are pushed out of the market as the state ramps up its anti-pollution campaign.