The cement industry is expected to experience a profit recovery.

Since mid-March, cement companies in Anhui, Jiangsu, Zhejiang, Jilin, and other regions have been issuing price adjustment notices, with cement prices generally increasing by 20 to 40 yuan per ton.

Experts interviewed generally believe that this round of price increases is the result of multiple factors working together. It is expected that this year’s cement industry profits will see a moderate recovery, but a significant upward trend is unlikely. In the long term, only by breaking free from cycle dependence, focusing on improving core business quality, and cultivating diverse growth points can the cement industry achieve high-quality development.

The actual effect of the price adjustments remains to be seen

“The core support for this round of price adjustments includes three aspects: first, March and April are the traditional peak construction seasons, and demand for cement is gradually rebounding; second, staggered production earlier has kept clinker inventories at medium to low levels, with the national clinker capacity utilization rate dropping below 50%, so inventory pressure is not high; third, companies are eager to restore profits, coupled with rising costs of diesel, coal, and other raw materials, providing strong support,” said Jiang Yuanlin, senior analyst at Century Construction Network, in an interview with Securities Daily.

Data from Century Construction Network shows that on March 14-15, bulk cement prices in the Yangtze River Delta region increased, with mainstream brands in southern Jiangsu and northern Zhejiang raising P.O42.5 bulk cement prices by 20 yuan per ton. Shanghai followed suit, with a noticeable increase in outbound shipments, and inventories dropped to 31%, continuing to improve market supply and demand. On March 16, the national cement price index was 332 yuan per ton, up 1.05 yuan from March 15, a daily increase of 0.32%.

However, the market remains cautious. A cement trader in Zhejiang admitted that currently, the operating rate of downstream construction sites and mixing stations is only 40-50%, and the actual effect of the price increase still needs to be observed.

From a macro perspective, 2026 will be the first year of the “14th Five-Year Plan,” with a series of major projects set to launch. Yuan Shua, deputy secretary-general of the Zhongguancun Internet of Things Industry Alliance, told Securities Daily: “The implementation of infrastructure-related projects will directly boost demand for cement, steel, and other building materials. However, the key bottleneck lies in the efficiency of fund disbursement and the speed of converting project physical work. If funds are delayed or approval processes are lengthy, demand release will be postponed; at the same time, some regions still face overcapacity issues in cement production. If new capacity is not well controlled, demand growth may be offset by excess capacity, making it difficult to sustain price increases.”

Cement companies accelerate transformation

According to data from the National Bureau of Statistics, the country’s cement output in 2025 was 1.693 billion tons, a year-on-year decrease of 6.9%. Monitoring by Digital Cement Network shows that the average transaction price of cement nationwide in 2025 was 367 yuan per ton, down 17 yuan from the previous year, a decline of 4.4%. Some regions even experienced prices falling below cost, with inventories remaining high.

“The industry has reached a critical point of transformation. Companies need to focus on extreme cost reduction and green transformation in their core businesses, as well as layout for a second growth curve,” Jiang Yuanlin said. Companies can develop environmentally friendly cement kiln co-processing, new energy businesses, and improve competitiveness through mergers and acquisitions along the industrial chain.

Leading companies have already seen results from their transformation efforts. Take Gansu Shangfeng Cement Co., Ltd. (hereinafter “Shangfeng Cement”) as an example. The company has continuously extended its building materials manufacturing industry chain, with gradually emerging results. In the first three quarters of 2025, the company sold 8.9465 million tons of aggregates, a year-on-year increase of 2.6238 million tons; its cement kiln co-processing of hazardous waste sludge, urban domestic waste, and general solid waste totaled 259,000 tons, up 55,100 tons year-on-year, generating revenue of 82 million yuan. In terms of new energy, projects such as photovoltaic, energy storage, and supercharging stations have achieved integrated “light, storage, charging, and carbon” systems. The photovoltaic power stations have a total generation of 24.82 million kWh, energy storage stations have discharged 2.2 million kWh, and charging stations have charged 1.77 million kWh. These green power projects save approximately 7,463 tons of standard coal and reduce about 20,000 tons of CO2 emissions, while also lowering logistics costs and improving efficiency. Since 2020, Shangfeng Cement has invested over 2 billion yuan in semiconductor full-industry chain equity investments, covering more than 20 high-quality semiconductor companies, forming a comprehensive investment system and industrial chain synergy.

Anhui Conch Cement Co., Ltd. (hereinafter “Conch Cement”) is actively promoting its “One Base, Five Industries, Dual-Drive” strategy. It leverages cement manufacturing as its foundation while simultaneously developing new energy, new materials, environmental protection, digital economy, and modern service trade sectors. With domestic lean operations and overseas scale expansion, the company is shifting from being the “world’s largest cement capacity” to “maximizing comprehensive profits.” Internationally, Conch Cement has completed strategic layouts in Southeast Asian and Central Asian countries such as Indonesia, Cambodia, Myanmar, Laos, and Uzbekistan.