Cement Network Report: Higher Electricity Costs Trigger Price Rise of Cement in Vietnam

Mainstream cement manufacturers in Vietnam have jointly announced an increase in quotations from October 20, 2024,

as rising electricity prices push up production costs.

The price increase has led most cement manufacturers to raise their cement prices by 50000 VND/ton (about 14 yuan/ton), while Vissai Cement has chosen a slight increase of 46,300 VND/ton (about 13 yuan/ton). According to the representative of Th Thành Thang Group, the price of electricity in Vietnam has increased by 4.8% since October 11, which has seriously affected the cost of cement production. "Despite our efforts to reduce production costs through waste heat recovery and other means, this still can not fully offset the impact of rising electricity charges," the representative said.

At present, the cost of electricity accounts for 15% -20% of the cost of cement production in Vietnam. In addition to electricity, fluctuations in coal and packaging prices caused by the intensification of global geopolitical conflicts have further put pressure on cement producers.

The Vietnam National Cement Association pointed out that the price of cement in Vietnam has been lower than production cost for many years, and it is necessary to raise the price to ensure the stability of the business. Without these adjustments, Vietnam's cement industry will be difficult to survive. More cement manufacturers in Vietnam are expected to make further price adjustments in the coming weeks

as production costs continue to rise. From January to September

2024, Vietnam's domestic cement consumption totaled 41.58 million tons, and domestic demand stagnated. At the same time, Vietnam's export volume of cement dropped to 14.95 million tons, with a year-on-year decrease of about 3%; the export volume of clinker dropped to 7.65 million tons, with a year-on-year decrease of about 5%; the total export amount of cement and clinker was 863 million US dollars, with a year-on-year decrease of about 15%.

Among them, Vietnam's domestic cement consumption reached 4.25 million tons in September, down 14% from the previous month and up 6% from the previous year. On the export side, the total export volume of cement and clinker dropped to 1.98 million tons, with a year-on-year and month-on-month decrease of 14% and 16% respectively; the cement shipment volume dropped to 1.29 million tons, with a year-on-year and month-on-month decrease of 7% and 21% respectively; the clinker export volume was about 690,000 tons, with a year-on-year and month-on-month decrease of 23% and 2% respectively.