050907: Holcim bullish, sees 13% hike in cement demand on govt drive

By Dennis D. Estopace

Reporter

NORZAGARAY, Bulacan—Cement manufacturer Holcim Philippines Inc. is rolling out a new product—Holcim Wallright, a cement mortar, as it steadily becomes bullish over the future of construction, which it expects to rise in the next several months after a steady decline in demand for cement since seven years ago.  “We expect a 13-percent increase in demand for cement as soon as government restarts its infrastructure program after the elections,” said senior vice president Francis C. Felizardo on Tuesday. Felizardo, who heads sales, marketing and distribution, said the shrinkage in the market was 2 percent from the 1997 Asian financial crisis that bogged down government and private construction projects. Now, they have seen a slight pick-up in demand from December last year and that as government goes into its planned spending spree on infrastructure, the demand would steadily go up. “That would be the second wind for the industry.” Vice president for operations Ferdinand A. Pecson said that while they are optimistic about the market, Holcim management is still not keen on opening up its Line 1 for production. The company has two lines in its 20-hectare manufacturing base here operated by some 250 employees. Line 2, Pecson said, runs at 67 percent of capacity producing between 18 million and 19 million tons of cement. The company’s other plants are in La Union, Davao and Misamis Oriental. To ride the past years’ slump in demand, Felizardo said Holcim focused on producing new products mainly for the export market: Wallright, for plastering, and Excel, a better version of the company’s current Portland and Pozzolan types. Felizardo added that since the company rolled out Excel in 2001, the brand contributed to its growing exports business. Last year, Holcim exported 873 kilotons of Portland and Excel while it sold locally 3,412 kilotons. Competitor La Farge Cement Philippines Inc., according to Felizardo’s data, still dominated the domestic market at 3,691 kilotons sold but its exports were just 143 kilotons. The exports market is still dominated, however, by Cemex Philippines Inc., posting foreign sales of 1,190 kilotons last year. It sold 2,399 kilotons in the domestic market. Felizardo said Excel is also priced the same as its Portland type at between P173 to P175 for a 50-kilo bag retail, and P170 for wholesale at a minimum of 600 bags. The cement companies had been reportedly asked by the Trade department to submit their pricing in view of allegations there is overpricing in cement.

 

 

http://www.businessmirror.com.ph/05092007/headlines04.html