of 2026, the national cement industry once again fell into an overall loss. The total cement output in China was 736 million tons, down 8% from the same period last year, an increase of 3.7 percentage points over the same period last year, and the output dropped to the lowest level in more than a decade. In terms of price, since the beginning of the year, the national cement price has been declining almost all the way. By the end of July, the average price of domestic cement has dropped by about 30 yuan/ton compared with the beginning of the year, and by about 35 yuan/ton compared with the same period last year.
All the dilemmas point to the same root cause: serious overcapacity. In 2025 , the utilization rate of clinker production capacity in China was only 48%, and more than half of the production capacity was idle. Industry profits fell from a peak of 186.7 billion yuan in 2019 to 29 billion yuan in 2025, shrinking by 84.5%, and the mountain of overcapacity is overwhelming the industry. Over
capacity is the root cause
of all the problems, and the capacity utilization rate of 48% means that more than half of the kilns in the industry are "basking in the sun". In 2025, the national cement output was 1.693 billion tons, down 6.9% from the same period last year, a new low since 2010. The industry expects demand to fall to 1 billion to 1.2 billion tons by 2030, with an average annual decline of 6% to 10%. At present, the total cement production capacity exceeds 3 billion tons-even if demand does not fall, nearly half of the production capacity is redundant.
Demand is shrinking, production capacity is not shrinking, and the gap between supply and demand is widening. In the first half of the year, the national cement production continued to decline, and some analysts pointed out that even if the overproduction management was completed and the enterprises produced strictly according to the record capacity, the industry capacity was still seriously excessive. According to the data of China Cement Network, the paper data of cement clinker production capacity in China is still more than 1.7 billion tons, and the actual production capacity is higher. 1.7 billion tons of clinker is enough to produce nearly 3 billion tons of cement.
Such a serious contradiction between supply and demand makes any price push up at the market level just stop boiling. At present, the ex-factory price of cement in some areas has dropped to 150 yuan/ton, and enterprises sell one ton at a loss, but still can not stop-because if they stop, their share will be taken away by others. Cement enterprises fall into a strange circle, prices can not rise, stop production can not stop.
Capacity clearance must be genuine
. "Absolute overcapacity in the downward cycle of demand" is the core disease of the current cement industry. But a clear diagnosis is not the same as an operation. At present, what the industry needs most is the withdrawal of production capacity in a real sense, rather than "reduction control" means of capacity replacement and peak staggering production. Reduction regulation is an antipyretic, and capacity clearance is the scalpel.
Conch Group has formally submitted the proposal of setting up a special fund for capacity removal to the National People's Congress, pointing out that some enterprises are willing to withdraw and that the time is ripe and the conditions are met to promote the fund for capacity removal. The direction is right-let the production capacity withdraw orderly under the market-oriented mechanism, rather than relying on administrative orders to shut down forcibly. However, the fund is still in the stage of proposal, and the speed of landing can not catch up with the speed of blood loss in the industry. In the first quarter of 2026, the industry has lost money again as a whole, and time waits for no one.
Capacity clearance can no longer be superficial. What is needed is: to truly withdraw the actual production capacity, not just to turn "overproduction" into "compliance"; to make backward production capacity unable to rely on synergy to stabilize prices, to shut down or dismantle production lines with high cost curves and poor energy efficiency; to increase concentration, so that high-quality large enterprises can become regional market stabilizers.
Production capacity is the root cause of the disease, and clearance is the antidote. Staggering peak and stopping kilns can cure the standard, and capacity replacement can manage the account, but to make the industry really stop bleeding, the only way is to shut down, dismantle and return the redundant kilns.
However, from the current point of view, many enterprises in the industry are still holding the mentality of muddling along, even if the output control is becoming more and more difficult, the effect of peak staggering production is getting worse and worse, and the price is becoming more and more difficult to stabilize, they still dare not open up competition or take the initiative to shut down backward production capacity, lacking the determination of strong men to break their wrists.
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