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Vietnam Cement Clinker exports may recover in the second half of 2023


Besides the decline in real estate demand, cement businesses continue to be under pressure from the export market. Specifically, exports of cement and clinker in the past year recorded a very strong decrease compared to last year's performance. Vietnam's cement export market is forecasted to recover in the second half of 2023 thanks to the reopening of China.

Although in December 2022, the export situation of cement and clinker in traditional markets such as Taiwan, Bangladesh, Malaysia... has improved significantly, but cannot compensate for the decrease of many previous months.

Data from the General Department of Vietnam Customs shows that China is Vietnam's largest cement export market. However, due to weak construction demand in China, Vietnam's cement exports to this market decreased significantly.

Along with that, countries that import cement and clinker continue to implement many protectionist policies for domestic cement production, apply technical barriers to trade, and high transportation charges cause difficulties for businesses. Accordingly, the total export of cement and clinker in 2022 only reached 31.7 million tons, down 29% over the same period last year.

SSI Securities (SSI Research) believes that the export market can also recover in the second half of 2023 thanks to the reopening of China. This can also help reduce competitive pressure for businesses in the North and Central of Vietnam.

Also in the fourth quarter of 2022, SSI's analysis department also noticed signs of recovery when cement exports increased by 32% compared to the previous quarter. However, this consumption channel may still be affected by the increase of clinker export tax from 5% to 10% from January 1, 2023 to limit mineral exports, according to Decree No. 101/ 2021/ND-CP. When taxes and fees increase, export prices will be more expensive, so importing countries have to calculate more to choose which country to import from.

Source: Vietcemworld | A Member of HASACONS VIET NAM

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