Hanoi (VNS/VNA) - The cement industry is forecast to see asignificant increase in domestic sales in 2021, driven by investment ininfrastructure, foreign direct investment inflow and the recovery of the realestate market. However, exports are set to slow down.

According to a recent report by SSI Research, domestic cement demand isexpected to increase around 5-7 percent this year compared to 2020. Theincrease in domestic sales will be fuelled by the increase in infrastructure investment,foreign direct investment inflow into the country and the recovery of the realestate market, which will push up demand for cement, SSI Research said.

Cement exports are expected to be stable as import demand of China remains highamid infrastructure investment, however, it would be difficult to see stronggrowth like 2020 because China’s cement supply is gradually recovering.

Overall, total sales of cement and clinker are forecast to increase by about 2 percentthis year.

SSI Research estimated that total production capacity of the cement industrywould increase by 7 million tonnes, or 7 percent, due to new production linesthat became operational at the end of 2020 and at the beginning of this year.Competition will also increase in the domestic market, boosting cement prices.

SSI Research also pointed out that heavy dependence on cement exports to theChinese market remained a worry, especially as China could tighten its fiscalpolicies in the future. China accounted for 57 percent of Vietnam’s cement andclinker export and 22 percent of the country’s total cement and clinker saleslast year.

Total sales of cement and clinker were estimated at 101.5 million tonnes lastyear, representing a rise of 1.5 percent over 2019.

According to the Vietnam Cement Association, due to the impacts of the COVID-19pandemic, domestic sales of cement fell 5 percent to 56.1 million tonnes inJanuary – November as construction activities were sluggish, especially in thefirst four months of this year when social distancing was imposed. InJanuary-April, cement sales decreased by 10 percent from the same period lastyear.

However, domestic cement sales saw significant increases in May – November asthe construction and investment in infrastructure was sped up.

The Government focused on speeding up the disbursement of public investment todrive economic growth in the pandemic, which accelerated investment ininfrastructure development.

The cement export increased strongly in the first 11 months of last year, by 15percent over the same period, driven by exports to China which saw a rise of102 percent in volume./.