SEOUL - South Korea's cement industry is grappling with a severe downturn, as shipment figures have plummeted since the beginning of the year due to a prolonged slump in the construction sector. Industry experts are now forecasting that the industry's overall performance for 2024 could regress to levels not seen since the 1980s.

According to the Korea Cement Association, cement shipments for January and February totaled 4.451 million tons, marking a significant 24.8% decrease compared to the same period last year. This sharp decline follows a 16.9% year-on-year reduction observed in the same period in 2023, indicating an accelerating downward trend.

When compared to the peak shipment figures of 7.117 million tons recorded in January and February 2023, this year's numbers represent only about 62.5% of that level. The association now believes that achieving the annual shipment target of 40 million tons will be exceedingly difficult, as the first two months of the year fell significantly below the minimum target.

"The prospect of annual domestic shipments falling to 40 million tons marks an unprecedented low since the industry first entered that range in 1991," stated a representative from the Cement Association. "This level of decline has not been witnessed even during the IMF financial crisis, signaling a potential regression to 1980s levels for the domestic cement industry."

As cement shipments continue to decline, industry inventories have swelled to approximately 3.4 million tons by the end of February, reaching nearly 90% of the industry's total storage capacity. In response to this oversupply, major players like Hanil Cement have already begun suspending production lines. Currently, eight out of the industry's 35 production lines are inactive, with plans to halt operations of two more lines in April.

"The cement industry, which faced a demand cliff last year due to the severe construction slump, is now facing a survival crisis due to the continued harsh decline in domestic demand," said an official from the Cement Association. The industry is calling for urgent measures to address the crisis and prevent further deterioration of the sector.

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