Vietnam's cement supply is likely to surpass its demand by 5-8 million tons in 2010, according to the Vietnam Cement Association on Tuesday.

The potential oversupply is mainly because the Vietnamese government has recently licensed some new foreign-invested cement projects and many operational joint ventures to expand their production, and many localities, especially those in the northern region, which are rich in cement materials, are strongly encouraging cement production.

Vietnam's Construction Ministry has proposed the government limit the license of new cement projects, since the country will find it difficult to export cement due to higher prices, and face serious environmental pollution caused by rampant cement production, the association said, noting that cement makers in Vietnam currently have combined annual capacity of 33-34 million tons.

Vietnam's demand for cement is expected to increase to 46.8 million tons in 2010, 62.5 million tons in 2015 and 69 million tons in 2020, the country's Construction Material Institute said recently, noting that it consumed some 29 million tons of cement in 2005, about 26 million tons in 2004, and 23 million tons in 2003.

Most of cement factories in Vietnam use domestically-produced clinker for production, and others resort to clinker imports which amount to 4-5 million tons a year, the institute said.

Source: Xinhua