2024, South Korea's cement industry faced many difficulties, producing 41.93 million tons of cement, a sharp decline of 18% year-on-year, a 33-year low. The domestic construction market continued to be depressed, dragging down the total sales of cement enterprises, only 44.19 million tons, down 13.28% year-on-year. Among them, 43.59 million tons of cement were sold domestically, with a decline in domestic sales, while 590000 tons of cement were exported, with an increase in export volume, especially 2.43 million tons of clinker.
Looking forward to 2025, the domestic situation in South Korea is still not optimistic. Political uncertainty, high exchange rate, high inflation and other factors are intertwined, making the road to recovery of the construction market difficult and dangerous. It is estimated that the sales volume of cement enterprises will further drop to about 43.3 million tons, of which the domestic sales volume will drop to 40 million tons, while the export volume of cement and clinker is planned to increase to 3.3 million tons.
In 2025, Korean cement enterprises will face tremendous pressure of rising costs. With the increase of electricity price, the cost of electricity accounts for 25% of the cost of cement, which undoubtedly increases the burden of enterprises. At the same time, the tightening of environmental laws and regulations requires enterprises to invest more funds in environmental protection to further promote the cost of cement production.
Despite the fall in coal prices in South Korea and the downturn in the domestic construction market, cement prices in South Korea remain high, reaching 112000 won per ton, up 42% from 2021. Although the government set up relevant agencies in 2025 to stabilize the price of building materials, enterprises still hope to respond by raising prices in order to maintain profitability in the market with shrinking demand. At present, the cement production capacity of
Korean enterprises is about 62 million tons, and the cement kiln has been shut down, and the operating rate is maintained at about 65%. If demand declines further, enterprises will not rule out the possibility of further shutdown.
South Korea will upgrade its cement clinker export plan for 2025, which may have a negative impact on the surrounding markets. On the one hand, South Korea's export growth will intensify the competition in the surrounding market, which may impact cement enterprises in other countries; on the other hand, it may also change the cement market pattern in the region, affecting the balance of cement supply and demand in relevant countries.
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