Core Viewpoint - The cement industry is experiencing a significant transformation, with domestic demand declining and companies increasingly relying on overseas markets for growth. The profitability of major players has improved due to successful international ventures, despite challenges in the domestic market [5][12]. Group 1: Domestic Market Challenges - The cement industry has faced a downturn since 2021, with production expected to drop to 1.825 billion tons in 2024, a nearly 25% decrease from peak levels [7]. - Profitability has sharply declined, with industry profits projected at 26.6 billion yuan in 2024, down approximately 85% from the historical high of 186.7 billion yuan in 2019 [7]. - The first three quarters of 2025 saw a 5.2% year-on-year decline in national cement production, marking the lowest level for the same period since 2010 [8]. Group 2: Policy Responses - In response to the industry's challenges, the China Cement Association issued guidelines in July 2025 aimed at aligning actual production capacity with registered capacity to address overcapacity issues [8]. - Major companies like Conch Cement have begun to exit production lines, with Conch Cement shutting down 16 lines, accounting for over 22% of total industry capacity [8]. Group 3: International Expansion - Chinese cement companies have significantly increased their overseas investments, with capacity rising from 45.03 million tons in 2021 to 87.58 million tons in 2024 [14]. - Sub-Saharan Africa is identified as a key market for growth, with low per capita cement consumption and high potential demand driven by urbanization and infrastructure investment [15]. - The average cement price in Africa ranges from $60 to $140 per ton, providing a favorable profit margin compared to domestic prices [16]. Group 4: Success and Challenges in Overseas Markets - Companies like Huaxin Cement and Conch Cement have reported substantial overseas revenue contributions, with Huaxin's overseas revenue accounting for 27.6% and Conch's at 6% [23]. - Despite the potential, the success rate of overseas investments is below 40%, with challenges including stringent environmental regulations and high operational costs in regions like Africa [24][25]. - Political and legal risks, as well as local competition, pose significant challenges for companies expanding internationally [29].