{"id":226315,"date":"2025-10-26T10:48:15","date_gmt":"2025-10-26T10:48:15","guid":{"rendered":"https:\/\/www.newsbeep.com\/uk\/226315\/"},"modified":"2025-10-26T10:48:15","modified_gmt":"2025-10-26T10:48:15","slug":"cement-sector-reels-under-overcapacity-weak-demand-and-financial-strain","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/uk\/226315\/","title":{"rendered":"Cement sector reels under overcapacity, weak demand, and financial strain"},"content":{"rendered":"

Industry leaders urge govt to revive stalled projects, ease imports for raw materials <\/p>\n

\n 25 October, 2025, 12:00 pm <\/p>\n

\n Last modified: 25 October, 2025, 02:57 pm <\/p>\n

\n Representational image. Photo: Mumit M<\/p>\n

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\"Representational<\/p>\n

\n Representational image. Photo: Mumit M <\/p>\n

Bangladesh’s cement industry is grappling with one of its worst downturns as excess production capacity, soaring financial costs, and shrinking demand squeezing producers across the board.<\/p>\n

Most plants in the industry are running at below 30% of capacity, far short of the global standard of 70%-80%, industry leaders said. The result is a market flooded with unsold cement, plummeting prices, and mounting financial distress.<\/p>\n

Over the past decade, driven by optimism over megaprojects, a booming housing market, and the plan to establish 100 economic zones, investors poured more than Tk45,000 crore into expansions. The production capacity reached around 10 crore tonnes a year, four times higher than a decade ago.<\/p>\n


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However, demand has not kept pace. In 2024, the country consumed only 3.8 crore tonnes \u2013 less than 40% of total capacity. This year, consumption has fallen further, forcing factories to cut output and lay off workers.\n<\/p>\n

Amirul Haque, president of Bangladesh Cement Manufacturers Association (BCMA), said, “After Covid-19, we began recovering in 2021, driven by renewed construction. But since 2023, the situation has worsened drastically.”\u00a0<\/p>\n

He added, “Entrepreneurs expanded based on government demand. When projects slowed, we faced a severe cash flow crisis. Several small plants have already shut down.”<\/p>\n

Infographic: TBS<\/p>\n

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Infographic: TBS<\/p>\n

‘Factories operating below survival level’\n<\/p>\n

Bashundhara Cement, with an annual capacity of 7.3 million tonnes, is operating at only 20% utilisation.\u00a0<\/p>\n

KM Zahid Uddin, the company’s deputy managing director, said, “We’ve reduced manpower and slashed prices, yet continue to incur losses.”<\/p>\n

Mir Cement, which expanded capacity to 18 lakh tonnes in 2023, now finds investment turning into a liability. A senior company official said sales have dropped so steeply that production has been cut to a quarter of total capacity.\u00a0<\/p>\n

“We’re struggling to pay wages. If conditions don’t improve soon, production may stop entirely,” he said.<\/p>\n

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Bengal Cement, Aramit Cement, and Mostafa Hakim Cement have already suspended operations, industry insiders said. Their management could not be reached for comments.\n<\/p>\n

Top producers<\/p>\n

Shah Cement, part of Abul Khair Group, remains the country’s largest producer with a 10 million tonnes annual capacity. It continues to run at over 50% utilisation \u2013 better than most \u2013 but faces growing price and demand pressures.<\/p>\n

Premier Cement Managing Director Amirul Haque said, “We supplied cement for the Karnaphuli Tunnel and other major projects. Now, with construction slowing, we’re operating at only around 40% capacity.”<\/p>\n

Crown Cement Adviser Masud Khan said the slowdown in economic activity has left demand far below expectations. “For two years, we’ve seen a sluggish economy. Around 60% of our capacity is idle.”<\/p>\n

Meghna Group of Industries, which operates under the Fresh and Meghnacem Deluxe brands, is an exception, with 6% growth but still has utilisation rate at 65%.<\/p>\n

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Khorshed Alam, the group’s executive director, said public and private construction has slowed significantly. The market is oversupplied, and demand keeps falling.\n<\/p>\n

He said that especially smaller companies are struggling to cope with the demand crisis.<\/p>\n

Falling prices, rising costs<\/p>\n

According to industry sources, a 50kg bag of cement now sells for Tk470\u2013500 \u2013 around Tk25-30 less than a year ago.\u00a0<\/p>\n

Besides, imported raw materials like clinker and gypsum have become costlier, while Bangladesh Bank’s policy rate hikes have sharply raised borrowing expenses.<\/p>\n

“The sector has invested around Tk45,000 crore, about 70% financed through bank loans,” said BCMA Executive Committee Member Md Shahidullah, also managing director of Metrocem Cement.\u00a0<\/p>\n

“Revenues are falling, but loan repayments and interest costs keep climbing. For many firms, the pressure is unbearable,” he added.<\/p>\n

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Many firms are unable to pay suppliers or sustain payrolls. The industry employs about 7-8 lakh workers directly and another 2 lakh indirectly. With factories scaling down or closing, thousands of jobs are at risk, he added.\n<\/p>\n

Call for govt intervention<\/p>\n

Industry leaders have urged the government to revive stalled projects, ease import procedures for raw materials, and extend financial relief to struggling firms.\u00a0<\/p>\n

“If project spending resumes and credit access improves, the sector can recover,” said BCMA President Amirul Haque. “Otherwise, more closures and defaults are inevitable.”<\/p>\n

However, he said, “Bangladesh’s long-term need for urban housing and infrastructure remains strong. But until demand revives and financial costs ease, the cement industry faces one of its hardest battles yet.”<\/p>\n","protected":false},"excerpt":{"rendered":"Industry leaders urge govt to revive stalled projects, ease imports for raw materials 25 October, 2025, 12:00 pm…\n","protected":false},"author":2,"featured_media":226316,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[96412,96422,96417,96423,84,96425,96415,96421,96413,96416,96419,96426,1294,96424,96418,96420,56,54,55,96414],"class_list":{"0":"post-226315","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-bangladesh-cement-industry","9":"tag-bangladesh-cement-manufacturers-association","10":"tag-bashundhara-cement","11":"tag-bcma","12":"tag-business","13":"tag-cement-factory-closures-bangladesh","14":"tag-cement-price-drop-bangladesh","15":"tag-cement-raw-material-import-costs","16":"tag-cement-sector-overcapacity","17":"tag-construction-slowdown-bangladesh","18":"tag-crown-cement","19":"tag-economic-downturn-impact","20":"tag-economy","21":"tag-financial-strain-on-cement-companies","22":"tag-shah-cement","23":"tag-stalled-government-projects-bangladesh","24":"tag-uk","25":"tag-united-kingdom","26":"tag-unitedkingdom","27":"tag-weak-demand-for-cement"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/226315","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=226315"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/226315\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/226316"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=226315"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=226315"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=226315"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}