Cement prices continue positive momentum in 2Q 2018

Gray cement trade prices recorded an overall improvement in the second quarter of 2018, according to the 2Q 2018 update of CW Research's Global Cement Trade Price Report.

Domestic indices mirrored the positive trend, albeit at different rates across international markets.

ÔÇ£Looking onwards, most regions are expected to witness a decrease in cement trade prices. In Asia-Pacific-Japan, however, a rapidly growing domestic demand in Bangladesh is pushing the regional average up, while the rest of the region is trying to stay competitiveÔÇØ, observed Tea Vukicevic, CW Group's Associate Analyst.

US domestic prices still plagued by weather conditions

Average selling prices in China rose to USD 58.1 per ton quarter on quarter. In the Pakistani market, despite the double-digit yearly decline, cement domestic prices improved over the previous quarter. As for Thailand, cement manufacturers believe that the 13.1 percent annual improvement was supported by the commencement of planned infrastructure projects.

In the US, on the West Coast, the market conditions were strong enough to mitigate the poorer price results of the Northeastern and Midwestern regions. Below-expectation results in the North East and the Midwest were a consequence of the unseasonal weather conditions ÔÇô which did not help in the Southern market either. As such, cement ex-works prices inched up in the first quarter of 2018, having topped USD 100.

In the Mediterranean Basin, domestic indices rose over eight percent year on year, supported by strong pricing trends in Italy and Egypt. In Italy, cement average selling prices increased, despite the economic uncertainty arising from the unpredictable impact of the elections. In Egypt, positive pricing developments followed the recent improvements in domestic demand.

Gray cement trade prices rise in 2Q 2018; China loses leadership

In June 2018, global average FOB prices for gray cement increased by almost four percent to USD 57.4 per ton when compared to the same period the previous year.

Unlike the last quarter of 2017 and the first of 2018, when China stood as the world's leading gray cement exporter, over 2Q 2018, that place was taken by Turkey. The Turkish cement market accounted for 13.0 percent of the gray cement total trade during that period.

Also in the second quarter of 2018, in the Asia-Pacific-Japan region, trade prices for gray cement are estimated to have risen to USD 46.4 per ton. In the Mediterranean Basin, gray cement average export prices are estimated to have surpassed USD 50 per ton.

In 3Q 2018, most regions are expected to record a decline in gray cement FOB prices, except for Asia-Pacific-Japan.

Turkey consolidates hegemony of white cement exports

When it comes to white cement trade, Turkey unsurprisingly resurfaces as the largest exporter of the premium commodity in the second quarter of 2018. Not only did the Turkish cement market keep its leading exporting position, it reinforced it by expanding its share from over 20 percent in 1Q 2018 to over 30 percent of the white cement global trade over 2Q 2018.

Similarly to the previous quarters, Asia-Pacific-Japan was the leading exporting region of clinker during the second quarter of 2018, having shipped almost six million tons. In the region, trade prices for the commodity are forecasted to slip marginally over the third quarter ÔÇô a contracting trend that will be more pronounced in the Mediterranean Basin region.

Keeping up with 1Q 2018, Japan continued to lead the slag exporting market, despite the double-digit decline in shipped volumes both year on year and quarter on quarter.

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