Bangladeshi cement market expanding with public infrastructure investment

Greenwich (CT), USA, May 30, 2017 – According to CW Research’s 2017 Bangladesh Cement Market Report, cement consumption in the country is expected to increase nine percent per year on average through 2021. The growth is driven by public works in the infrastructure segment and real estate development works propelled by high population growth and urbanization.

The Bangladeshi government is actively seeking to improve national construction through a combination of building new roads and upgrading existing infrastructure. Public works are also favored for their political impact in improving conditions.

According to Robert Madeira, CW Managing Director and Head of Research: “Political promises have been made around infrastructure and affordable housing. Time will tell if Bangladesh will be able to deliver on these ambitions, so there is some down-side risk – in addition to other smoldering issues. Nonetheless, it is clear that much remains to be done in terms of construction in the country and the long-term cement demand story is clearly there.”
Overall, public infrastructure projects account for 35 percent of the country’s total cement consumption. On the private side, the individual, small-scale construction market makes for 40 percent of the total. The remaining 25 percent is covered by real estate developers.

The cement market’s outlook remains promising, despite the dependency on clinker imports

The Bangladeshi cement industry is highly fragmented and counts on more than 40 players of various degrees of industrial size and professionalism. The shortage of quality limestone reserves in the country means that today there is only one integrated cement plant operating in the country, Lafarge Surma. Even so, this plant actually is importing limestone from India via a conveyor belt across the border.

All other cement manufacturers operate grinding plants using imported clinker. These grinding stations range widely in size and commercial sophistication, from small mini-mills to enterprise-level grinding plants; capacities range between 0.1 million tons to 5.2 million tons.

With such a high dependency on clinker imports, the government has maintained low import duties to foment some domestic value added component in form of grinding, rather than just importing finished cement. Clinker imports are mostly sourced from China, Thailand, Vietnam and Malaysia. Nonetheless, exploration continues to try and identify domestically viable limestone reserves to be able to support clinker production locally.

Raluca Cercel, CW’s Senior Consulting Analyst, observes: “It is rare for such a large cement market to be almost entirely dependent on clinker imports for cement production, hence the Bangladeshi cement market is highly susceptible to fluctuations of clinker supply and prices. Moreover, electricity supply is inconsistent, having forced manufacturers to build their own captive power supply to be able to grind raw material.”

For 2017, cement capacity is forecasted to reach over 35 million tons. Cement manufacturers, including S. Alam Cement Mills, Aman Cement Factory, Olympic Cement, Eastern Cement, Aramit Cement, Alam &Co., Chhatack Cement, among others, are providing an additional 3.4 million tons of cement to the existing capacity in the coming years. Cement production units are concentrated close to Dhaka and Chittagong, as these cities are the largest consumers in the domestic market.

Despite the dependency on clinker imports to meet cement production needs, Bangladesh’s outlook for the future remains positive. As Raluca Cercel emphasizes: “the market has continued to thrive, and is expected to continue doing so in the coming years.”

****
For more information, placing an order, or interview inquiries, please contact Liviu Dinu, Market Services & Marketing Consultant, CW Group, by phone at +40-744-67-44-11, or e-mail at ld@cwgrp.com.

About the Report

The Bangladesh Cement Market Report, part of CW Research’s Cement Industry Country Report series, meets the country-level cement market research needs of small and large businesses, analysts and governments. The reports cover cement volume trends in detail, analyzing trade flows, cement demand and production (historical and a five-year outlook), per capita consumption, and the competitive landscape, including company profiles, cement production facility details, including past and announced brownfield production increases and greenfield projects. Cement Industry Country Reports also cover demand drivers, including macro-economic and construction sector dynamics, for the specific country. Industry reports are presented in an objective, easy-to-understand format, providing hard-to-find answers to top market research questions.

More information about the report can be found here: http://www.cwgrp.com/research/research-products/country-reports/product/206-bangladesh-cement-market-report-forecast-through-2021

About CW Group

The Greenwich (Conn.), USA-headquartered CW Group is a leading advisory, research and business intelligence boutique with a global presence and a multi-industry orientation. CW Group is particularly recognized for its sector expertise in heavy-side building materials (cement), light-side building materials, traditional and renewable power & energy, petrochemicals, metals & mining, industrial minerals, industrial manufacturing, bulk cargo & shipping, among others. We have a strong functional capability, grounded in our methodical and quantitative philosophy, including due diligence, sourcing intelligence, feasibility studies and commodity forecasting. www.cwgrp.com

PO Box 5263, Greenwich, CT 06831, USA
Liviu Dinu
Market Services & Marketing Consultant
M: +40-744-67-44-11
E: ld@cwgrp.com

This release was published on openPR.