SunSirs: Demand in Northern China Nearly “Frozen” as Cement Market Sees “Prices Without Transactions”

According to Sina Finance, last week marked the traditional off-season for the national market, characterized by either “prices without transactions” or “apparent stability with hidden declines.” Demand in northern regions has nearly “frozen” due to low temperatures, with markets in Northeast and Northwest China experiencing a situation where prices exist but transactions are scarce. Central and Southern Hebei in North China attempted another price hike of RMB50 per ton, but new orders remain extremely limited, with implementation still under observation. Southern regions also saw continued weakening demand with pronounced seasonal price declines. Transactions in Fujian, Jiangxi, Guangdong, and multiple areas of Hubei and Hunan showed downward trends, while major manufacturers maintained stable external quotations. Henan and Shandong attempted price hikes but faced implementation challenges. Southwest Sichuan-Chongqing markets faced downward pressure, while Yunnan-Guizhou may be considering price increases—implementation remains to be seen.

East China Region

Jiangsu: Around the 15th, transaction prices for cement from major enterprises in Nanjing, Zhenjiang, and other areas softened, declining by approximately 10-15 RMB/ton. Quotations in other provincial markets showed no significant fluctuations for now.

Zhejiang: Last week, some leading enterprises in the province made corrective downward adjustments of 20-30 RMB/ton to cement prices in multiple markets. Actual transactions had already declined earlier, with smaller recent drops. Additionally, it is reported that on the 15th, leading enterprises in the coastal Ningbo area notified a cement price increase of 10 RMB/ton, primarily targeting price recovery in areas where covert reductions had previously occurred.

Anhui: Currently, leading enterprises in multiple markets around Lake Chaohu and northern Anhui maintain stable cement quotations for core markets. However, transaction prices in peripheral cross-market areas show widespread declines of 20-30 RMB/ton, indicating overall market pressure.

Fujian: Major Fujian producers announced a 30 RMB/ton cement price hike at the end of October. Since mid-month, actual transaction prices for most regional producers have come under pressure and declined, with market quotations largely reverting to pre-October increase levels. Fujian cement prices are expected to remain stable with a weakening trend going forward.

Jiangxi: Starting November 15, some major manufacturers in Jiujiang, Jiangxi, announced cement price hikes of 20 RMB/ton, though actual implementation appears limited. Earlier this month, other markets in Jiangxi also pushed for 20-RMB/ton increases. Recently, actual transaction prices for some regional enterprises in multiple markets have largely fallen back to pre-hike levels from early this month, though major manufacturers' external quotations remain firm.

Shandong: Driven by kiln shutdowns and persistently low regional cement prices, manufacturers have strong intentions to raise prices. From the 18th to the 20th, some leading enterprises in the province continued to attempt to notify a cement price increase of 30 RMB/ton. Currently, only a few companies have issued adjustment notices, and the implementation of this round of price hikes faces significant challenges.

Central and Southern Regions

Guangdong: Following failed attempts to raise prices in the Pearl River Delta region at the end of October, some major players recently lowered bulk cement prices by approximately 15-20 RMB/ton. Industry-wide follow-through with price cuts is expected.

Guangxi: Despite initial attempts to raise prices at the beginning of the month, implementation has been poor. Some companies still plan to push for further increases. Overall demand in the region remains low, with cement prices largely stable.

Hubei: Downward pressure persists across Hubei's cement market, with localized minor price adjustments. Short-term outlook remains weak overall.

Hunan: To alleviate inventory pressure, actual transaction prices in Yueyang, Changde, Zhangjiajie, Huaihua, and Xiangxi have recently declined by approximately ¥20/ton. The market remains predominantly weak, with actual trends still under observation.

Henan: Henan implemented a 121-day staggered production shutdown starting November 15, easing inventory pressures. Recent favorable weather conditions have boosted downstream demand. Coupled with environmental controls, manufacturers strongly pushed for price hikes, raising cement prices by 20-30 RMB/ton last weekend. Implementation of this round of increases requires further monitoring.

Southwest Region

Sichuan-Chongqing: Despite multiple rounds of price hikes across regions earlier, implementation has been generally poor due to high inventory pressure. Actual transaction prices have declined by 20 RMB/ton at major producers in Western Chongqing, the main urban area, and Guang'an/Nanchong in Sichuan. Some producers in Deyang-Mianyang and Le'yi-Ya'an regions in Sichuan showed signs of softening by 10-20 RMB/ton, while quotations remained relatively stable in other areas during the week.

Yunnan: Despite multiple attempts to push prices upward, actual implementation has been ineffective, with prices struggling to stabilize within a reasonable range.

Guizhou: Despite a recent round of price hike notices, insufficient terminal demand support has resulted in suboptimal price implementation. Specific developments remain to be observed.

Northwest Region

As temperatures continue to drop, the northwest cement market is accelerating into its traditional off-season cycle. Demand has weakened across the board, with prices generally holding steady. While localized rush-order demand supports the Guanzhong area, demand in Gansu and Ningxia has significantly decreased, nearing completion phases with stable pricing. Construction sites in Xinjiang and Qinghai have largely halted due to cooling temperatures and snowfall. Xinjiang may initiate a price recovery strategy by year-end to prepare for market positioning early next year.

North China Region

Beijing-Tianjin-Hebei: Market feedback indicates that rising fuel costs and intensified environmental controls are continuously squeezing profit margins for cement producers in areas like Shijiazhuang, Hebei. To improve profitability, leading enterprises in central and southern Hebei announced another cement and clinker price hike of 50 RMB/ton effective November 19. Reports suggest Baoding is also pushing for a 30 RMB/ton cement price increase. Overall, regional demand remains subdued, with implementation details requiring further monitoring.

Shanxi: Demand has declined significantly as project supply nears completion. Kiln shutdowns are now in effect, with prices largely stable.

Inner Mongolia: Construction halts have further reduced cement demand across most areas. While prices remain steady, market activity has noticeably slowed.

Northeast Region

Leading enterprises in Jilin and Liaoning recently announced simultaneous price hikes of 30-50 RMB/ton for various cement grades, aiming to recover from earlier overselling. However, low temperatures have halted construction sites, leaving only sporadic indoor work. Daily shipments are less than 10% of normal levels, and mainstream transactions remain at pre-increase prices. The market has entered a price freeze phase, with cement prices expected to stabilize throughout winter until March next year.

Market Outlook: With temperatures dropping significantly, outdoor construction projects in many northern regions have largely concluded, creating a situation where prices exist but transactions are scarce. Southern markets face seasonal demand declines, making it difficult to implement price hikes, with attempts to raise prices failing in many areas. This week (November 24-28), national cement market transactions are expected to weaken further, with more instances of apparent stability masking underlying price declines.

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