Cement ex-works prices to continue to increase due to spiking production costs in 3Q22

• Cement ex-works prices are forecast to increase more than 20 percent in Russia and 14 percent in Kazakhstan, quarter-on-quarter in the 3Q
• Sub-Saharan Africa's ex-works prices to rise on a quarterly basis, due to an increase in Nigerian prices
• Asia ex-China ex-works prices to climb in 3Q boosted by increases in Indonesia and South Korea

Greenwich (CT), USA, August 2, 2022 – Cement ex-works prices are forecast to range from an increase of less than 2 percent in Saudi Arabia to an increase of more than 20 percent in Russia, quarter-on-quarter, in the third quarter of 2022, according to the 2Q2022 update of the CW Research's Global Cement Trade Price Report (GCTPR).

An increase in production costs due to higher energy prices exacerbated by the Russia-Ukraine conflict continues to add pressure on domestic cement prices across several markets in the third quarter of 2022. Additionally, supply-chain disruptions and recent geopolitical events are expected to support the high prices in the short term.

"Prices in Eastern Europe and CIS are likely to continue to see a robust increase in the 3Q as soaring energy and fuel prices continue to add pressure on production costs. Meanwhile, in Sub-Saharan Africa, Nigeria is forecast to lead regional prices as a consequence of both higher production and distribution costs," explained Julieth Tovar, Business Analyst at CW Group.

Ex-works prices across Europe to see increases in 3Q

In the third quarter of the year, CW Research expects the largest increase in ex-works prices in Eastern Europe and CIS to be witnessed in Russia, by over 20 percent, followed by Kazakhstan and the Czech Republic, with an increase of 14 and 12 percent, respectively. These increases are a consequence of skyrocketing natural gas and fuel prices, which have been resulting in higher production and transportation costs.

Meanwhile, in Western Europe, ex-works cement prices in 3Q are forecast to see an increase across all markets. French and German prices are expected to increase by more than 4 and 3 percent quarter-on-quarter, respectively, as the construction sector in both countries faces rising production costs, scarcity of raw materials, and delivery delays.

Nigeria continues to drive regional ex-works prices to increase

In Sub-Saharan Africa, ex-works cement prices in the third quarter of 2022 are forecast to see the largest increase in Nigeria, up by about 8 percent quarter-on-quarter, driven by raw material price increases. Additionally, prices are being pressured by higher production costs and distribution issues.

In the Meditteranean Basin, ex-works prices in the 3Q are expected to range from an increase of more than 2 percent QoQ in Italy to more than 5 percent in Algeria.

Asia ex-China ex-works prices to increase across several regional markets in 3Q

In the third quarter of 2022, Philippines' ex-works prices are expected to increase by almost 2 percent, followed by Thailand with an increase of more than 1 percent quarter-on-quarter due to several factors including high inflation.

Meanwhile, Chinese ex-works prices are expected to decrease almost 2 percent on a quarter-on-quarter basis, due to the rainy season, as the market enters the traditional offseason.

The Global Cement Trade Price Report is CW Research's benchmark price assessment for monthly gray cement, white cement, clinker and granulated blast furnace slag prices and volumes. The 150+ page report, published on a quarterly basis, serves as the industry go-to source for monthly price data for over 70 individual markets worldwide, including multiple cornerstone data series: import, export, ex-works and market prices.

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