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Building materials sector sapped by overcapacity, weak demand

Xinhua, February 7, 2016 Adjust font size:

China's building materials sector took a hit last year as overcapacity persisted and demand shrank.

Cement output recorded the first drop for 25 years in 2015, falling 4.9 percent year on year to 2.35 billion tonnes, the Ministry of Industry and Information Technology (MIIT) said on its website.

Profits of major cement producers plunged 58 percent to 33 billion yuan (5 billion U.S. dollars) last year.

Output of flat glass fell 8.6 percent year on year to 740 million tonnes, with producers' profits down 12.4 percent.

In total, the profits of major building materials producers fell 6.9 percent to 449 billion yuan last year.

The industry still faces serious overcapacity and declining demand, the MIIT said, while forecasting the market would remain depressed as housing investment continues to cool this year.

The property sector, a major consumer of cement and flat glass, saw annual investment rising merely 1 percent in 2015, a sharp decrease from the 10.5-percent growth in 2014.

Regulators would advance efforts to trim down capacity in building materials and strictly enforce environmental standards, the MIIT said. Endi