Argentina's cement market is in the midst of a deep correction driven by a combination of shrinking demand and soaring energy costs. In April this year, the national cement consumption dropped by 12.7% to 730900 tons, the domestic output dropped by 13.2% to 733500 tons, and the export collapsed from 7291 tons to 2861 tons. If we look at the cumulative performance since the beginning of the year, in the first four months, the national demand fell by 3.3% to 3.0428 million tons, the output fell by 3.7% to 3.058 million tons, and the export plunged by 48.5%. However, the monthly decline in April far exceeded the cumulative level, indicating that the deterioration of the market is accelerating rather than periodic fluctuations.
As Argentina's largest cement producer, Loma Negra's response reflects the severity of the industry's difficulties. The company has announced a six-month shutdown of one of its rotary kilns at its Amalí plant in Buenos Aires L 'Amal until November 2026. This measure is clearly defined as the core part of the production adjustment plan, which aims to reduce excess clinker and cement stocks. What is more serious is that the second rotary kiln of the plant is also scheduled to enter a state of shutdown in May and June. Although it may be restarted in July, the nearly synchronous shutdown of the two kiln lines means that the production base will be in a state of extremely low load or even shutdown for several months. The company said that the existing inventory level is expected to cover the domestic market demand, which confirms the current reality of poor sales and inventory backlog from the side. The impact of the
cost side is resonating with the weakness of the demand side. Argentine LNG import prices have climbed to about $20 per million British thermal units, up more than 62% from $12.3 a year ago. The sharp rise in energy prices has directly pushed up the cost of fuel and electricity for cement production, and some industrial producers have begun to consider temporary production cuts during the winter. For cement enterprises facing shrinking demand, rising costs further reduce profit margins, making it no longer economically feasible to maintain high-load operation.
From the perspective of market structure, although the import volume in April increased by 31.7% year-on-year to 212 tons, the absolute scale was very small and had little impact on the domestic market; the cumulative import in the first four months decreased by 47.4% to 410 tons, indicating that even in the case of a sharp contraction in domestic production, the space for import substitution was extremely limited. The collapse of the export side reflects the simultaneous weakening of the competitiveness of Argentine cement in the international market, and the pattern of weak domestic and foreign demand has been fully formed.
On the whole, Argentina's cement industry is currently in a typical "volume and price double killing" cycle. The contraction in demand has forced leading companies to take historic large-scale shutdown, while soaring energy costs have left companies little room to move beyond production cuts. Loma Negra's decision to stop production for six months is not only a company's inventory management strategy, but also a concentrated reflection of the structural surplus and cost crisis faced by the whole Argentine cement industry. With winter approaching, if energy prices remain high and construction activity fails to recover substantially, further production adjustment and capacity contraction in the industry may be unavoidable.
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