Capacity expansion is on the cards for many global cement manufacturers in 2023

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After a difficult year in 2022, the construction industry is poised to record strong recovery growth in 2023. Driven by higher government spending, improved market conditions, and a decline in construction material prices, are among the many factors that are projected to assist the growth of the construction industry around the world from the short to medium-term perspective. This revival in the infrastructure, commercial, and residential construction activities will also aid cement consumption, and subsequently the growth of the global cement market over the next 12 months in 2023.

To capitalize on the growing demand for cement, manufacturers are expected to add further capacity to their existing production from the short to medium-term perspective. Many of the leading cement manufacturers, globally, have already announced their plans to expand cement capacity to meet the growing demand.

• In February 2023, Bestway Cement, one of the leading cement manufacturers in Pakistan, announced that the firm had expanded its capacity with the completion of the Hattar Plant Line.
• In February 2023, Mir Cement, the Bangladesh-based cement manufacturer, also announced that the firm is planning to expand its cement production capacity by 2024. The firm, which currently produces Portland cement and Portland pozzolana cement, is planning to increase its cement production capacity to 5,000 tonnes per day by 2024.
• In March 2023, Adani Group, one of the leading Indian conglomerates, also announced that the firm is planning to expand its footprint in the cement market by setting up two new cement plants in the country. As part of its expansion strategy, the firm is setting up new plants with a total capacity of 10 million tonnes per annum.

In 2022, Adani Group acquired ACC and Ambuja Cement from Holcim, and therefore, became the second largest cement player in the Indian market, which is poised to record strong growth over the next 12 months. The addition of more cement capacity will enable the firm to gain more market share from the short to medium-term perspective in the fast-growing Indian market.

Alongside the Asia Pacific region, cement manufacturers in other regions of the world are also seen expanding their cement production capacity in 2023. For instance,

• In January 2023, Unacem Peru also announced that the firm significantly plans to increase its cement production cement from the medium-term perspective. As part of the initiative, the firm has also announced to invest US$130 million in capital expenditure during 2023, which will assist Unacem to increase its capacity from 8.3 million tonnes per year. This is double the amount that the firm invested in 2022. The strategy to expand the production capacity comes after the firm achieved strong cement sales in 2022.
• In October 2022, Yura, the Grupo Gloria subsidiary, also announced that the firm is considering cement production capacity expansion from the short to medium-term perspective. The strategy to add more production capacity comes at a time when the cement manufacturer is expecting the construction demand in Peru to grow at double the pace of the gross domestic product.
• In the Middle East, Oman Cement Company announced that the firm is currently in the process to expand its production capacity at the Misfah cement plant. The project will drive the plant's cement capacity by 25% to 5,000 tonnes per day from the current 4,000 tonnes. From the short to medium-term perspective, the firm is considering tripling its production capacity to meet the growing demand for cement across the region.

In 2022, the Oman Cement Company recorded sales worth US$173 million. This represents a growth of 42% compared to the year before. On the other hand, the cement sales volume also increased significantly to reach 3.46 million tonnes per year.

As the demand for cement continues to grow across regions in the global market, many more cement manufacturers are projected to expand their cement production capacity over the next 12 months. This will keep driving the competitive landscape in the global cement market, which is poised to record strong growth over the next three to four years, owing to growing public and private investment in the infrastructure, commercial, and residential construction market.