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Building materials market forecast to be robust in 2021

Posted on 13 January 2021

The building materials market is forecast to be robust this year, with the demand fuelled by the increase in infrastructure development investment and the recovery of the property market, according to the Ministry of Construction.

There were increases in demand for building materials this year, Phạm Văn Bắc, Director of the ministry’s Department of Building Materials said.

Repairing infrastructure damaged by the floods in the central region and landslides in mountainous areas would require a large volume of construction materials. In addition, the real estate market was expected to recover, which would lead to increases in real estate investment, pushing up demand for construction materials.

With such good demand, the construction materials market would be very robust this year, he said.

Bắc said the supply industry needed to prioritise projects producing new material, of large-scale and advanced technology as well as projects which use waste from other sectors.

According to VNDirect Securities Company, the building materials industry would benefit greatly from the trend of increasing investment in development this year.

One of the notable infrastructure projects was the North-South Expressway.

VNDirect estimated that 40 per cent of the public investment for road and 11 component projects would be disbursed in 2021. Around VNĐ23.7 trillion or 60 per cent of the construction costs would be allocated to building materials. It was estimated that these projects would need asphalt worth around VNĐ5.9 trillion, steel VNĐ6.4 trillion and cement VNĐ3.8 trillion this year.

To complete these projects by 2023, expenses for asphalt, steel and cement would be VNĐ20.8 trillion, VNĐ14.8 trillion and VNĐ8.9 trillion respectively.

Việt Nam could also benefit from China’s plan of investing in infrastructure development, which would push up China’s demand for imported steel and cement, according to VNDirect which also forecast the trend would continue to mid-2021 at least.

According to S&P Global Platts, China approved 14 airport projects worth around $15.3 billion last year, together with 22 railway projects.

Việt Nam’s export of cement and steel to China saw significant increases in recent months.

Statistics showed that cement export to China rose by 102 per cent in volume in the first 11 months of last year while steel export to China jumped by 1,414 per cent in the January-October period.

In August, the Prime Minister approved the strategy of developing construction materials in 2021-30 period which encouraged investment in projects which used advanced technology in production, energy saving and environmentally friend buildings. 

Source : Vietnam News