The demand for cement, steel and other construction materials will surge sharply in the fourth quarter, but prices will remain unchanged or even drop, forecast industry insiders.

The Vietnam Cement Association had previously warned that cement producers might lift prices due to a 25-percent hike in the cost of coal, a main fuel for the industry. But, so far, cement prices have remained stable.

Vietnam Cement Corporation deputy director Tran Viet Thang said that cement producers may hold the line on prices since cement supplies were currently about 3 million tonnes in excess of demand, a surplus that could reach 5 million tonnes by the end of the year.

The trend should continue through next year as new cement plants come on line, he said.

The corporation was predicting that cement consumption this year would increase by only roughly 4-5 percent over last year, Thang said, so no single producer was willing to risk pushing up prices without an agreement on the issue among all cement producers.

Vietnam Steel Association chairman Pham Chi Cuong was also predicting a sharp rise in demand for steel in the late months of the year but said prices were not likely to increase.

Cuong said that the cost of pig iron on the world market had fallen from 530 USD to 480-500 USD per tonne as many pig iron producers around the world, including China, Thailand and Malaysia, were facing a surplus.

The nation used more than 3 million tonnes of steel in the first nine months of the year, up 29 percent over the same period last year.

Nevertheless, the Vietnam Steel Corporation last week announced a price decrease of 200,000 VND per tonne to 11.32 million VND (665.88 USD) for steel coil, and other producers were expected to follow suit.

In the ceramic fixtures and tile industry, the Vietnam Building Ceramic Association (Vibica) estimated that the industry’s estimated output of 6 million units would outstrip demand of just 5 million units.

The industry was expected to produce 261 million sq.m of tile this year, while export demand was expected to fall by about 30 percent to just 150 million sq.m Vibica said./.