Cement makers eye 20pc growth

Cement manufacturers eye around 20 percent growth this year, riding on the rising demand from the housing sector.

Even poor energy supply and infrastructure constraints such as inadequate roads and ports could not dampen the growth prospect, they said.

“We're expecting 15-20 percent growth this year. The figure would have been bigger, if there were no energy constraints,” said Mostofa Kamal, president of Bangladesh Cement Manufacturers Association.

If the government starts constructing roads and bridges, the growth can double, he said.

The association data shows 34 out of 54 cement factories are in operations, with a combined annual production capacity of 18.5 million tonnes.

The 2009 cement consumption was 11 million tonnes, up from 10 million tonnes a year ago. Dhaka and Chittagong account for nearly 65 percent of the total consumption.

Market players said they experienced slack sales in 2007-08 when an army-backed caretaker government ruled the country. Real estate business was at the lowest ebb at that time. But the market started reversing soon after an elected government took power in January 2009.

“Every company made good business in 2009 because of the booming construction sector. Many factories are on expansion,” said Kamal, also the owner of Fresh Cement.
Fresh Cement has recently received an export order of 18,000 tonnes to Tripura, an Indian northeast state bordering Bangladesh.

Other market players also expect good sales this year and the next few years.
Yusuf Abdul Noor, a manager of Eastern Cement, forecasts a consumption of over 13 million tonnes for 2010.

Shankar Roy, general manager of Holcim Bangladesh, said cement makers logged good sales even in the rainy season, a comparatively lean period for construction works.

Shah Cement has the highest production capacity of 2.22 million tonnes a year. The other big producers are Meghna Cement (1.44 million tonnes), Lafarge Surma (1.2 million tonnes), Akij (1.08 million tonnes) and Seven Circle (1.02 million tonnes).

Source: The Daily Star, August 17, 2010