Saudi Arabia Cement Industry Report 2025 | Fuel Diversification and Digitization Key to Securing Public Tenders and Strategic Alliances in Energy Sector - ResearchAndMarkets.com

DUBLIN--(BUSINESS WIRE)--The "Saudi Arabia Cement Industry Market Size & Forecast by Value and Volume Across 80+ Market Segments by Cement Products, Distribution Channel, Market Share, Import - Export, End Markets - Databook Q2 2025 Update" report has been added to ResearchAndMarkets.com's offering.

The cement market in Saudi Arabia is expected to grow by 5.1% annually to reach US$3.51 billion in 2025. The cement market in the country recorded strong growth during 2020-2024, achieving a CAGR of 5.5%. Growth momentum is expected to remain positive, with the market projected to expand at a CAGR of 4.7% during 2025-2029. By the end of 2029, the cement market is projected to expand from its 2024 value of US$3.34 billion to approximately US$4.22 billion.

This report provides a data-rich, forward-looking analysis of cement industry, covering market size, pricing trends, production, consumption, and segment-level performance from 2020 to 2029. It examines cement demand across key residential, non-residential, and infrastructure sectors alongside granular segmentation by cement type, distribution channel, end-user profile, and city tier.

Saudi Arabia's cement industry is entering a new phase of growth and transformation, driven by Vision 2030 mega-projects, public infrastructure expansion, and increasing focus on sustainability. While regional overcapacity remains a concern, major players are aligning with national development plans through capacity realignment, local sourcing, and decarbonization investments. Companies are optimizing supply chains to meet project-based demand, particularly in the Western and Central regions. Strategic partnerships for waste-derived fuels, digital plant upgrades, and low-carbon cement development are becoming central to competitiveness. At the same time, firms are managing risks related to energy pricing, export limitations, and labor cost inflation.

The future of the industry hinges on its ability to adapt to Saudi Arabia's rapid infrastructure build-out, strengthen ESG compliance, and participate in the circular economy while maintaining cost discipline. Saudi Arabia's cement sector is at the heart of its Vision 2030 infrastructure transformation. While demand from giga-projects and public works offers long-term volume certainty, firms must navigate rising costs, regulatory pressures, and regional saturation. Operational excellence, local partnership strength, and ESG alignment will become key differentiators.

Players that invest in fuel diversification, digitized plant operations, and sustainable product lines will improve their eligibility for public tenders and strategic alliances. At the same time, addressing logistical constraints, quarry licensing issues, and skilled labor shortages will be critical to realizing projected capacity utilization. With policy support and capital discipline, the Saudi cement industry can evolve from a commodity producer to a value-driven partner in the Kingdom's ambitious development agenda.

Vision 2030 Projects and Public Works Are Driving Cement Demand

• Megaprojects Under Vision 2030 Are Creating Strong Regional Demand: NEOM, The Line, Red Sea Project, Qiddiya, and other giga-projects are driving cement consumption in Tabuk, Riyadh, and Makkah regions. Southern Cement and Northern Region Cement have realigned logistics and dispatch operations to serve these locations efficiently. Contractors have begun bulk orders for specialized cement for foundation and pre-cast elements.
• Municipal Infrastructure and Housing Developments Are Sustaining Base Demand: Public housing schemes under the National Housing Company (NHC) and roadworks by the Ministry of Transport continue to generate consistent demand. Companies like Yamama Cement and Najran Cement have secured multi-year supply contracts linked to road, sewage, and utility infrastructure upgrades.
• Private Construction Activity Remains Moderate but Targeted: High-end real estate and commercial centers in Riyadh and Jeddah are contributing niche demand, particularly for white cement and rapid-setting variants. However, broader residential construction remains subdued due to rising mortgage rates and material costs.

Strategic Investments and Green Partnerships Are Reframing Competitive Models

• Joint Ventures and Capacity Swaps Are Addressing Regional Overlap: Companies are entering logistics-sharing agreements and clinker swap arrangements to improve plant utilization across high-demand zones. In 2024, Eastern Province Cement partnered with a local logistics firm to streamline dispatch to Red Sea coast developments.
• Alternative Fuels and Co-Processing Are Expanding Across Kilns: Yamama Cement and Arabian Cement have introduced RDF (refuse-derived fuel) into kilns at pilot scale, aligned with Saudi Green Initiative goals. Cement producers are signing MoUs with municipalities and waste firms to source biomass and industrial waste for thermal energy substitution.
• Digital Plant Upgrades Are Improving Efficiency and Compliance: Major producers are implementing predictive maintenance, digital fuel mix optimization, and automated emissions tracking. Southern Cement deployed a centralized digital operations dashboard in 2023 to coordinate its Abha and Bisha plants more effectively.

Production is Affected by Energy Cost Reforms, Regulatory Audits, and Raw Material Dynamics

• Fuel Pricing Reforms Are Increasing Operating Costs: The phase-out of energy subsidies and fuel price alignment with international benchmarks have increased the cost base for kiln operations. Firms are renegotiating power supply agreements and accelerating investment in WHRS (waste heat recovery systems).
• Environmental Compliance and Permit Delays Are Slowing Expansions: New regulations under the National Environmental Compliance Framework are requiring advanced emissions reporting and air quality control measures. Several expansion plans in Asir and Hail have faced environmental permitting delays, extending capex timelines.
• Raw Material Licensing and Transport Remain Operational Constraints: Securing quarry leases under revised mining laws is taking longer, especially in border-adjacent and protected regions. Cement transportation is constrained by high logistics costs and driver shortages during seasonal peaks, especially during Hajj-related construction.

Cautiously Optimistic Outlook Supported by Vision 2030 Execution

• Public Sector Projects Will Anchor Volume Through 2026: The Saudi government remains committed to infrastructure spending under the Public Investment Fund (PIF) and Five-Year Development Plan. Cement demand will be sustained by project execution cycles for transport, health, and energy infrastructure.
• Green Building and Procurement Standards Are Gaining Ground: The Saudi Building Code and Aramco procurement mandates are increasingly favoring lower-emission cement products and sustainable sourcing. Firms investing in certified green cement are better positioned to win government and corporate construction contracts.
• Export Markets Offer Limited Relief Amid Regional Competition: Exports to Yemen and Africa have resumed but remain constrained by price competition from Egypt and Turkey. Clinker surplus is being routed to Asia-Pacific where logistics costs remain high, limiting profitability.

Risks Are Emerging Across Energy Exposure, Market Saturation, and Labor Constraints

• Overcapacity and Uneven Regional Utilization Persist: Installed capacity continues to exceed national demand, particularly in the Eastern and Northern regions. Without additional export outlets or consolidation, pricing pressure and asset underutilization may affect long-term margins.
• Labor Costs and Saudization Compliance Add Pressure: Nationalization targets under Nitaqat and rising wage expectations are increasing HR-related operating costs. Skilled labor shortages in engineering and plant operations have delayed efficiency upgrades and project staffing.
• Climate and Resource Policy Shifts Require Strategic Flexibility: Future implementation of carbon pricing or Scope 3 emissions rules could add compliance costs for cement and downstream contractors. Increased scrutiny over water use and raw material extraction may further tighten resource planning.

Scope

Saudi Arabia Cement Industry Overview

• Cement Production KPIs: Volume and Value
• Cement Consumption KPIs: Volume and Value
• Average Cement Price Trends: Tracked at overall and cement-type level

Saudi Arabia Cement Market by Type of Cement

• Portland Cement
• Blended Cement
• Specialty Cement
• Green Cement

Blended Cement Market by Subtypes of Cement

• Type IS(X) - Portland-Slag Cement
• Type IP(X) - Portland-Pozzolan Cement
• IL(X) - Portland-Limestone Cement
• Type IT - Ternary Blended Cement

Specialty Cement Cement Market by Subtypes of Cement

• Rapid Hardening Cement
• High Alumina Cement
• White Cement
• Sulfate-Resistant Cement
• Other Niche Specialty Cements

Saudi Arabia Cement Market by Key Sector

Residential Construction

• Multi-Family Housing
• Single-Family Housing

Non-Residential Construction

Commercial Buildings:

• Office Buildings
• Retail Spaces
• Hospitality Facilities
• Restaurants
• Sports Complexes
• Other Commercial Properties

Industrial Buildings:

• Manufacturing Units
• Chemical & Pharmaceutical Facilities
• Metal and Material Processing Plants

Institutional Buildings:

• Healthcare Facilities
• Educational Institutions
• Other Institutional Structures

Infrastructure & Other Construction

Saudi Arabia Cement Market by Distribution Channel

• Direct Distribution (B2B Sales)
• Indirect Distribution (Retailers, Dealers)

Saudi Arabia Cement Market by End-User

• Ready-Mix Concrete Producers
• Concrete Product Manufacturers
• Individual Consumers (Self-use)
• Other Industrial/Commercial Users

Saudi Arabia Cement Market by Location Tier

• Tier-I Cities
• Tier-II Cities
• Tier-III Cities

Saudi Arabia Cement Trade Dynamics

• Key Export Destinations
• Key Import Sources

Competitive Landscape: Saudi Arabia Cement Market

• Market Share Analysis of Key Players

For more information about this report visit https://www.researchandmarkets.com/r/n5ifu9

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