Vietnam's cement industry is facing a serious crisis in recent years. This situation started appearing at the end of 2017 and so far has not shown any signs of ending.
Cement businesses in the industry are facing many difficulties and challenges, and many of them have had to close down or reduce output to minimize losses.
1. One of the main causes of this crisis is overproduction. Over the years, Vietnam's cement industry has invested heavily in new projects to increase production capacity. At present, the total designed capacity can reach 200%, twice the domestic demand. This excess has led to fierce competition among businesses, reduced countervailing prices and adversely affected profits.
2. In addition, this crisis situation is exacerbated by the decrease in domestic cement consumption. After a long time of the Covid-19 epidemic, the residential area has exhausted the financial accumulation to build houses. The real estate sector is in serious crisis due to macro instability. Infrastructure investment is difficult due to policy inadequacies.
Besides, through the investigation, in recent years, the demand for cement in Vietnam has decreased partly due to the shift to using other construction materials such as lightweight concrete, renewable materials. or wood. This has partly affected the production output and the price of cement.
3. In addition, Vietnam's Cement industry also faces other challenges such as competition from foreign cement manufacturers; geopolitical instability, war, etc., leading to high input material costs, and especially the influence of government policies and regulations, are not favorable for the industry.
In this crisis situation, businesses in Vietnam's cement industry are having to find ways to reduce costs, increase productivity and seek new opportunities for development. The government is also offering supportive policies to deal with this crisis, but much work still needs to be done to bring Vietnam's cement industry into operation in a state similar to that of the economy.