Displaying items by tag: Vietnam
Vietnam: The World Bank is expected to provide US$200m in loans for Vietnamese cement plants to invest in waste heat recovery (WHR) systems according to the Vietnam National Cement Association (VNCA). The VNCA said the financing pledge is part of the bank's programme to finance efficient energy consumption for the local cement industry.
At present only Holcim and Ha Tien 2 in southern Vietnam, and Chinfon and Cong Thanh in northern Vietnam have invested in WHR systems. In April 2014 the VNCA admitted that there had been a delay to build WHR systems in all cement plants with a clinker production capacity of 2500t/day by 2015.
Vietnamese cement sales hit year’s target in just 11 months
08 December 2014Vietnam: Cement sales in Vietnam jumped by 16% year-on-year to 64.46Mt in the first 11 months of 2014, fulfilling the government's full-year target, according to its own data. Of the sum 46.16Mt were sold to the domestic market, an 8% year-on-year rise and meeting 94% of the year's plan. 18.30Mt were exports, a year-on-year rise of 43%, 22% higher than the year's target.
In November 2014, Vietnam's cement sales rose by 1% year-on-year to 6.2Mt, including 4.52Mt of domestic sales, up by 3% month-on-month and 25% year-on-year and cement exports dropped by 50% month-on-month and by 35% year-on-year to 1.5Mt.
The country is expected to put into operation four cement plants including Cong Thanh, Dong Lam, Thach My and Trung Son with a combined capacity of 7.5Mt in 2014, raising the country's total
Vietnamese exports up by 15%
17 November 2014Vietnam: Vietnam could earn as much as US$1bn via the export of 20-21Mt of cement and clinker in 2014, 15% more in value terms compared to 2013, according to the Vietnam Cement Association. Preliminary statistics from the Customs General Department showed that the shipment of cement and clinker increased in both volume and value in January-October, reaching nearly 18Mt over 10 months.
Tran Viet Thang, Director General of the Vietnam Cement Industry Corporation (Vicem), which holds 34% the Vietnamese cement sector's output, said that Vicem exported about 1.8Mt of cement and clinker in the first three quarters of 2014 and plans to sell a further 1Mt in the final three months of the year.
Thang Long Cement to construct a second 2.3Mt/yr line
13 November 2014Vietnam: Semen Gresik is reportedly preparing to double the annual production capacity of 2.3Mt/yr of the Thang Long Cement plant in Hoanh Bo District, Quang Ninh Province, through building the second production line. The Thang Long Cement 2 project is on the list of projects approved by the prime minister in 2011 for investment during the 2016 - 2020 period and features in the country's sectoral master plan. Semen Gresik acquired a 70% stake in Thang Long Cement for US$157m in 2012.
Holcim cement plant to take toxic Ha Long oil
07 October 2014Vietnam: Authorities in the northern province of Quang Ninh will remove 7000L of toxic oil from the edge of the Ha Long Bay in October 2014 and dispose of it at Holcim's cement plant in Mekong Delta. According to local media, the plant is the only facility in the country with the required technology.
The oil is contaminated with PCBs (polychlorinated biphenyls), a chemical group that associated with endocrine disruption and neurotoxicity and an illegal substance in Vietnam. PCBs are also carcinogenic.
The oil was imported by the state-owned Cuu Long Company in old transformers that were purchased in South Korea in November 2007. Quang Ninh officials fined Cuu Long for importing the machines in 2008 and ordered the company to return the transformers, which were intended for use in the construction of a thermal power plant. However, the exporter refused to take them back. The oil idled in the rusting devices, which sat covered in canvas at Cai Lan Port on the edge of the UNESCO world heritage site until the transformers began to leak.
Is capacity reduction the next step in Vietnam?
10 September 2014There were two telling stories from Vietnam this week that show the level to which demand has been overestimated in the centrally-planned cement sector. Firstly, the country reported that exports in the period between January and July 2014 increased by nearly a quarter year-on-year to 13.1Mt. Secondly, the Prime Minister announced that another five cement plant projects were to be axed, following nine others that bit the dust in 2013.
All this is against a backdrop of chronic lower-than-expected domestic cement demand. When we look at the figures, it’s not hard to see that domestic consumers have had trouble consuming all the cement produced in Vietnam. The government forecast for cement production in 2015 is in the region of 75 - 76Mt. If this was spread evenly between Vietnam’s 88.8m people, each person would have to consume ~850kg of cement. That’s possible but it is quite a lot for a lower middle income economy. However, separate reports state that a 10% rise in domestic sales on 2013 levels would lead to just 60Mt of domestic cement sales in 2015. This equates to a more realistic 675kg/capita.
These figures leave a massive and increasing amount of cement for export. Read again that figure from the first seven months of 2014 – 13.1Mt – Roughly the capacity of South Africa (~12.5Mt/yr), Tunisia (12.9Mt/yr) of Colombia (12.9Mt/yr)! Also, while cement exports volumes were up by nearly a quarter, the value of those same exports rose by only 20%. This indicates a drop in export prices and represents additional pressure to halt capacity expansion.
Against a backdrop of 90Mt/yr expected capacity in 2015 and falling export prices, the latest cement project cull certainly makes sense but even in a best-case scenario the country is looking at a capacity utilisation rate of just 66 - 67%. Some cement plant project owners have even found themselves trapped by the situation. Having indebted themselves on the promise of ever-increasing cement demand, they now face the prospect of throwing good money after bad, continuing to build and operate just to service debts. This is a very unenviable position indeed. The lifting of trade restrictions within the ASEAN Community on 1 January 2015 might help export volumes, but might also also drive prices down further.
Culling new cement plant projects is one thing, but could the next step be more drastic? North of the border, China is gradually reducing its overcapacity by removing older and less efficient capacity. Perhaps Vietnam would do well to follow suit.
Vietnam: Prime minister Nguyen Tan Dung has agreed to eliminate five more cement projects from the Zoning plan for the 2011 - 2020 period due to lower domestic cement consumption. The projects removed from the master plan have a combined capacity of 910,000t/yr. Earlier the prime minister had also approved the Ministry of Construction's proposal for removing nine clinker projects with a capacity of less than 2500t/day.
In 2013 the Vietnamese government decided to postpone the construction of nine other cement plants in Thanh Son, Tan Phu Xuan, Tan Tao, Yen Mao, Sai Gon Tan Ky, Phu Son, My Duc, Nam Dong and Minh Tam. While these cement plants face the axe, the government approved a project to develop Long Son Cement Plant, which will have a production capacity of 2.3Mt/yr in the northern province of Thanh Hoa. Construction commenced in early 2014 and will be put into operation in 2018.
Despite admitting the current cement glut on the local market, a number of projects are still underway as such schemes are enlisted in the nation's Zoning plan and project owners have invested huge sums in such plants, according Nguyen Van Thien, chairman of the Vietnam Cement Association. Project owners have no other choice but to continue the projects after injecting big funds, otherwise they cannot recover capital to service bank loans.
According to the Vietnam Cement Association, the combined capacity of all the country's cement plants is expected to reach more than 90Mt/yr by 2015, in line with the Zoning plan. Meanwhile, cement demand is forecast at 75 – 76Mt/yr by 2015. Vietnamese cement consumption was only 48Mt in 2012. Should demand rise by 5 - 10%/yr in 2014 and 2015, sales volumes would reach 60Mt, much lower than the expected figure.
Vietnam cement exports rise in first seven months
04 September 2014Vietnam: In the first seven months of 2014, Vietnam earned US$563m from the export of 13.1Mt of clinker and cement, a 24% rise year-on-year in value terms and a 20.4% increase in terms of volume. Indonesia, Taiwan and Malaysia were the largest importers of Vietnamese clinker and cement in this period, according to the Vietnamese Ministry of Industry and Trade.
Indonesia imported 1.42Mt of clinker and cement (worth US$69m), Taiwan bought 0.86Mt (US$37.6m) and Malaysia purchased 0.7Mt (US$34.7m). Cambodia was fourth with 0.29Mt (US$15.6m).
Vietnam's domestic cement sales are expected to rise by 9% year-on-year to between 49 - 50Mt in 2014, while cement and clinker exports are likely to hit 16 - 20Mt. The country exported 15Mt in 2013.
Vicem cement output rises 4.7% in year to date
20 August 2014Vietnam: State-owned Vietnam Cement Industry Corporation (Vicem) produced 10.2Mt of cement in the first seven months of 2014, a 4.7% increase compared to the same period of 2013. Vicem's clinker output, however, dipped by 1% year-on-year to 9.43Mt. In July 2014, Vicem's cement output rose by 7.8% year-on-year to 1.54Mt, while clinker output rose to 1.47Mt, a 8.1% rise.
In the first seven months of 2014, Vicem's total clinker and cement sales rose by 7% year-on-year to 12.7Mt, including 1.88Mt in July 2014, a 3.9% fall year-on-year. Of the total, 10.6Mt of cement and clinker were sold in Vietnam, down by 7.7% year-on-year. 2.12Mt were exported, an 86% rise year-on-year.
Vissai Ninh Binh Group to export 1.5Mt of clinker to Réunion
11 August 2014Vietnam: Vissai Ninh Binh Group has signed a contract with a French partner to export 1.5Mt of clinker to Ciment de Bourbon to serve to expressway road project on the French island of Réunion. This is the biggest contract that Vietnamese cement producers have secured to date, said Vissai Ninh Binh Group's deputy director Nguyen Tien Dat.
The clinker will be shipped at a price of US$42/t under the contract that will be effective for five years, the deputy director said. He noted that the firm has carefully considered the prices to avoid the negative impact driven by the fluctuations in prices of transportation.