The Brazilian cement market, strongly affected by rains in some regions of the country in January and February, closed the first quarter of the year with a decline of 2.4% in sales, said SNIC, a trade association representing companies in the sector.
In March, however, there was some recovery, with a 0.3% increase in sales, to 5.53 million tonnes. This is the average monthly level that the industry seeks to maintain this year, seen as difficult due to the scenario of many uncertainties.
In the period from January to March, 14.8 million tonnes of cement were shipped in Brazil, compared to 15.16 in the same period in 2021. In total, including exports, sales totaled 14.91 million tonnes — a 2.2% contraction compared to 15.25 million tonnes in the same quarter of 2021.
When comparing sales per working day — the best indicator that considers the number of days worked and that has a strong influence in cement consumption —, says the SNIC, the product sales totaled 230,300 tonnes in March, up 2.1% from February and 4.4% year over year. Still, the quarterly result showed a 3.1% decline compared to the three first months of last year.
“The sector’s performance was not worse in March due to the demand from the real estate market,” the trade group said in a note. However, the launching performance tends not to be sustained at these levels, once the increase in real estate inventory, the drop in sales and high interest rates are likely to discourage future developments, the association said.
According to Paulo Camillo Penna, head of SNIC, self-construction, an important inducer of cement consumption, continues to slow down due to the high level of unemployment, smaller income of the population (which saw the lowest value since 2012) and the growing indebtedness of families, which was 51.9%.
“Reflecting this picture are the successive drops in retail sales of construction materials seen since mid-2021, already for the eighth consecutive month, until February,” Mr. Penna said.
According to the executive, the skyrocketing costs of cement inputs, combined with strong instability of the political and economic scenario, do not allow making a forecast of good performance as those seen in the last three years. “The ambition of the industry in 2022 is to maintain the sustainability of the sector in the face of a terribly pressured environment.”
Source: Valor International