Brazilian cement demand sees 15% hike in October

Brazil’s cement market expanded 14.5 per cent YoY in October 2020 with demand at 6Mt, according to the country’s cement association, SNIC.

The southeast, the country’s largest market, saw sales increased by 9.4 per cent YoY to 2.702Mt in October, while in the northeast deliveries advanced 16.3 per cent to 1.275Mt. In the south 0.987Mt of cement was delivered, up 21.6 per cent. The central-west market expanded 18 per cent to 0.702Mt. In the north, the country’s smallest market, sales increased 27.2 per cent YoY to 0.29Mt.

The organisation attributed the rise in consumption to the increase of real estate launches and the residential and commercial construction reforms, which account for approximately 80 per cent of domestic cement consumption. Despite the crisis that affects several sectors of the economy, the real estate market is going through one of its best periods since 2014. The drop in interest rates, simplification of red tape and new lines of credit has encouraged property purchases.

“We believe that the good performance of the sector should continue, but in the medium term, we still have a horizon of uncertainty. The increase in sales of residential properties at surprising levels supports the performance of the cement sector, but imposes caution for the future. It is essential that there is generation of income and employment, the continuity of real estate launches, the maintenance of the rhythm of the works and the economic activity that will keep the breath of the auto builder and the confidence of the entrepreneur. On the other hand, infrastructure remains an extremely important activity for the cement industry, but it still remains underperforming,” said Paulo Camillo Penna, president of SNIC.

Exports surged from 11,000t in October 2019 to 26,000t in October 2020.

January-October 2020
In the January-October period, the market grew by 10.1 per cent to 50.5Mt, when compared with the 10M19.

Growth was most rapid in the northeastern market, where consumption increased 14.9 per cent YoY to 10.393Mt, followed by the central-western part which saw a 13.3 per cent pick-up to 5.8Mt. In the north demand expanded by 11.1 percent to 2.208Mt. In the south and southeast, sales advanced 8.5 per cent to 8.232Mt and 7.9 per cent to 23.912Mt, respectively.

Exports saw a 94.1 per cent hike from 102,000t in the 10M19 to 198,000t in the 10M20.