(Yicai Global) Nov. 30 -- Many Chinese cement producers have cut their prices and experts predict a further drop, Securities Daily reported today.

The lowest price this year was about CNY422 (USD66.22) a ton on average for P.O42.5 unpackaged cement in mid-July. Prices began to increase sharply in early August, rising more than 50 percent to CNY649 last month, according to the website Ccement.

But since last month, cement makers in Wuhan, Hubei province have slashed prices by nearly CNY100 (USD15.69) a ton, and firms in Sichuan province have cut them by CNY30 to CNY50 since Nov. 26. The biggest drop was seen in Guangdong province, where prices of bagged cement have fallen by CNY165 to CNY175 since last month.

The slump is partly a correction after the recent jump in prices, which came amid restricted production due to electricity shortages, along with a decline in production costs and falling coal prices, said Wang Qi, a cement market analyst with Sublime China Information.

Based on the experience of previous years, prices will fall further over the next month because winter is a slack season for cement.

“Prices have dropped, but are still high,” a staffer at a listed cement firm in Jiangxi province told Yicai Global. “Some construction sites will wait and see whether prices go down further.

“The output of some of our company’s production lines is restricted, which will impact the firm’s cement sales,” the person added.

Demand for cement is slightly lower this year and will be stable or will edge down next year because of slow growth in new real estate projects and construction volume, Wang said, predicting cement prices will drop further next year.

Editor: Tom Litting