Cement and Ready-Mix Concrete Shortage Sparks Emergency at Construction Sites... Industry Engages in 'Blame Game'

On the 3rd, at the construction site of 'Seoul Cinematheque' located in Chodong, Jung-gu, Seoul, the iron gate was firmly closed with a 'Construction Halted' sign posted.
[Photo by Noh Kyung-jo]

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#. A long-awaited project in the film industry, the construction of the Seoul Cinematheque, scheduled for completion in January next year, has been temporarily halted. The Cinematheque is a building intended for non-commercial film screenings, spanning from three basement floors to ten above ground. On the 3rd, a notice stating "Construction halted due to imbalance in ready-mix concrete supply" was posted on the steel gate at the construction site in Jung-gu, Seoul. The construction management team stated, "Originally, concrete pouring was planned for the 31st of last month but was canceled," adding, "We will resume construction after securing the required quantity through consultations with ready-mix concrete suppliers."

Recently, a supply shock of ready-mix concrete has occurred, especially at small to medium-sized construction sites. Causes include scheduled maintenance of cement manufacturers' production facilities (kilns), eco-friendly equipment modifications for carbon reduction, and logistics issues. Besides the Seoul Cinematheque construction, there is a high possibility that the repair and reinforcement work of the Jamsil underwater weir, which must be completed before the rainy season or floods, will also not be finished on time.

According to a survey by the Korea Construction Association targeting the top 100 construction companies, 98 out of 154 sites nationwide (63.6%) have experienced construction halts or delays since March due to unstable cement and ready-mix concrete supply. Particularly, among 42 public construction sites where ready-mix concrete price adjustments are impossible, only 4 sites reported normal cement and ready-mix concrete supply. Small to medium-sized construction companies, which have relatively less bargaining power, are helpless in this situation.

[Image source=Yonhap News]

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The government recently claimed that production has exceeded demand and has taken steps to manage the situation. According to the Ministry of Land, Infrastructure and Transport's inspection of supply trends through the Korea Cement Association, cement production from January to March this year was 10.51 million tons, a 2.6% increase. During the same period, demand was 10.43 million tons, a 5.7% increase compared to the same period last year. The increase in cement demand is attributed to carryover construction volumes following the Cargo Solidarity transport refusal incident at the end of last year and early construction starts due to warm temperatures. A Ministry official stated, "Cement inventory is also at 650,000 tons, similar to last year," and added, "We will closely monitor and respond to the supply trends of major construction materials in cooperation with related agencies."

The cement industry is making every effort to meet the unexpectedly increased demand. An industry insider said, "From April, kiln operations will be further expanded, increasing cement production." Additionally, export volumes contracted with overseas buyers such as the United States are being redirected to domestic supply as a priority. Export volumes are about 120,000 tons in the first quarter and 150,000 tons in the second quarter.

Small ready-mix concrete companies are also facing difficulties due to the unstable cement supply. A ready-mix concrete industry representative said, "About ten mixer trucks are lined up in front of the factory, indicating difficulties in shipment." The reduction in cement deliveries is slowing down ready-mix concrete production. Some suspect that cement companies are artificially controlling production or engaging in collusive behavior. The cement industry responded, "Unilateral claims that ignore the industry's efforts only hinder the mutual development of related industries."

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