Bangladesh cement sales drop as major construction projects shelved

Sales of cement in Bangladesh have nearly halved in the last few of months as real estate developers cancelled construction plans, while public projects were delayed because of nationwide unrest and the sudden political changeover.

According to the Bangladesh Cement Manufacturers Association (BCMA), cement sales declined by over three per cent to 25Mt in the January-August 2024 period compared to 26Mt  in the same period of 2023.

Cement producers have found it hard to move product. “Due to the student movement and sudden change in the political scenario, the demand for cement declined by nearly 50 permcent compared to usual," remarked Iqbal Chowdhury, chief executive officer of LafargeHolcim Bangladesh Ltd (LHBL).

He added that a lot of public projects were halted because contractors that were appointed to implement them had absconded after the Sheikh Hasina-led Awami League government was ousted by a mass uprising on 5 August. As such, demand for cement from the public sector, which accounts for 35 per cent of annual cement consumption, has plummeted, Mr Chowdhury said.

Demand from the real estate sector has also fallen since it is not undertaking new projects as sales have declined due to high interest rates for home loans. Similarly, individuals who were thinking of constructing buildings have also postponed such plans due to the sudden change in the political situation. 

Looking ahead, Mr Chowdhury further said the demand for cement in public infrastructure projects would not increase as the interim government will not implement any new infrastructure projects. Therefore, the cement sector is expected to witness a dull period for a long time although most big manufacturers expanded their production capacity, he said.