Construction material manufacturing enterprises increase search for orders

The impact of the global economic recession, the frozen real estate market, and the decline in construction demand... has caused construction material (CMA) manufacturing enterprises to face difficulties in selling their products. Efforts to find orders are the solutions being implemented by enterprises to stabilize production and maintain growth.

Construction material manufacturing enterprises increase search for orders Stone processing at Chau Quy Company Limited, Ha Tan Commune (Ha Trung).

Thanh Hoa currently has more than 500 enterprises operating in the field of construction materials production, divided into 12 industry groups such as: cement, ceramic tiles, unburnt bricks, stone mining and processing... Regardless of the industry group, the consumption of products of enterprises is very difficult, there is a lot of inventory. To "resist", enterprises are forced to reduce capacity, cut labor... Therefore, the production value of the construction materials industry in 2023 will decrease from 8 to 40% compared to the same period in 2022. In particular, many groups of fields will decrease sharply such as construction stone decreased by about 30 to 40%, construction bricks decreased by 25 to 30%, cement decreased by 8 to 38%...

Thanh Hoa Brick and Tile Association has 28 member enterprises, producing and supplying 4 billion bricks to the market each year. In 2023, the amount of bricks produced decreased to 1.6 billion bricks, but there were still about 200 million bricks left. Regarding this situation, Chairman of Thanh Hoa Brick and Tile Enterprises Association Luu Ngoc Luan said: 2023 is an extremely difficult year for the construction materials industry in general and bricks and tiles in particular. In addition to the difficulties due to high input costs (coal increased from 150 to 200%), the consumer market has narrowed due to a sharp decrease in construction demand, bricks from some provinces and cities in the country flooded in, taking up a part of the consumption market in the province...

To overcome difficulties and maintain production, businesses have proactively restructured production, reduced operating costs, flexibly planned sales and synchronized product consumption solutions. In particular, attention has been paid to finding and signing contracts with large construction contractors and civil construction projects to consume products. At the same time, selling prices have been reduced by 20 to 30% compared to previous years. By doing this, the inventory is gradually being resolved and businesses have started production after the Lunar New Year holiday. However, to create a boost for businesses to maintain production, Mr. Luan hopes that the province will pay attention and direct the People's Committees of districts, towns, cities, specialized project management boards, regions, and construction project investors to prioritize the use of construction materials produced in the province. At the same time, in the process of constructing works funded by the State budget, priority should be given to the use of tunnel bricks (so far, only unburnt bricks have been used). In addition, consider removing difficulties in the source of clay for brick production by not auctioning mineral exploitation rights for clay mines for brick production. On the other hand, reduce land rent and taxes in 2023 and 2024.

Thanh Hoa Stone Enterprise Association has 150 enterprises participating in the association's activities, each year producing and supplying the market with a value of about 50 million USD (for exported stones) and 2,000 billion VND (for domestic stones). Chairman of Thanh Hoa Stone Association Nguyen Van Tho said: Due to difficulties in the domestic and export stone consumption markets, in 2023, the revenue of enterprises exploiting and processing construction stone materials decreased by about 30 - 35% compared to the same period in 2022 (for domestic stones) and decreased by 60% (for stones exported to the European market). This is an unprecedented decline in the history of the stone industry.

To overcome difficulties and promote production development, the association will continue to encourage businesses to actively seek consumption markets such as expanding consumption markets to many provinces and cities in the country (for domestic stone). For exported stone, in addition to the traditional market of Europe, in 2024, they should not depend too much on this market, but strive to find new markets. Along with that, businesses need to restructure production, focus resources to balance financial resources, on that basis maintain operations and create jobs for workers.

Mr. Tho said that after the 2024 Lunar New Year holiday, stone mining and processing enterprises have started to return to work and many customers have come to buy products. Therefore, it is expected that by the end of the first quarter of 2024, the export value of stone from stone enterprises will reach 10 million USD. Mr. Tho also hopes that the Provincial People's Committee will pay attention and direct project investors to prioritize Thanh Hoa stone products when constructing project works or urban renovations using construction material stone products.

To remove difficulties and help construction material manufacturing enterprises stabilize, maintain and develop production, relevant departments and branches, especially the Provincial People's Committee, have recently sent an official dispatch to the Management Board of Nghi Son Economic Zone and Industrial Parks, relevant departments and branches, People's Committees of districts, towns and cities, specialized and regional construction investment project management boards and joint stock commercial banks to pay attention to and remove difficulties and obstacles for construction material manufacturing enterprises, including the use of products when constructing works from the state budget...

With the province's timely attention and solutions, along with the efforts and determination of businesses, it is hoped that the market for construction materials in the province will be brighter in the coming time.

Article and photos: Minh Ly

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