Cement industry sales rise as PH economy grows

Sales of local cement manufacturers grew by 8.6 percent to 5.2 million tons in the first three months of the year, given the continued growth seen in the construction and real estate industries.

During the same period last year, cement sales stood at 4.8 million tons, data from the Cement Manufacturers Association of the Philippines (Cemap) showed.

In a text message, Cemap president Ernesto Ordoñez explained that the increase in sales could be attributed to the hike in infrastructure spending by the government, as well as the continued spending and the confidence shown by the private sector in the local economy.

In a separate phone interview, Ordoñez added that Cemap is bullish about its prospects this year, expressing confidence that their members’ cement sales will continue to grow.

This was amid the challenges that cement manufacturers continue to face, such as the high costs of power and transport. Electricity alone reportedly accounts for anywhere from 40 percent to 60 percent of a cement company’s total operating costs.

Ordoñez declined, however, to cite any targets for the year as the group do not give out forecasts.

Last year, cement sales grew six percent to 19.4 million tons from the 18.4 million tons sold a year ago. In the fourth of 2013 alone, cement sales grew 2 percent to 4.5 million from the 4.4 million sold the previous year.

Cemap members include Cemex Philippines Group of Companies (Apo Cement Corp. and Solid Cement Corp.); Holcim Philippines Inc.; Lafarge Associated Companies; Northern Cement Corp.; Pacific Cement Philippines Inc.; and Taiheiyo Cement Philippines Inc.

The bullishness of the local cement industry is evident in the expansion and new plans being implemented by several firms.

Companies on expansion modes include Lafarge Republic, which announced in February that it was investing some 18.48 million euros in a new cement mill at its manufacturing plant in Bulacan in a bid to further boost its production capacity by 2015.