Cement firms gear up for Build Build Build

MANILA, Philippines — Pumped up by the expected surge in demand on the back of the government’s ambitious P9-trillion Build Build Build infrastructure program, cement firms are now pouring in additional investments to boost their capacity.

Although the Philippines still has the lowest per-capita cement consumption compared to its regional counterparts, demand has grown from 12 million metric tons in 2000 to 24.4 million MT in 2015 – a 4.8 percent growth. 

 Moreover, cement demand and consumption in the country is expected to grow along with the Philippine economy, which expanded at a compounded annual rate of 5.1 percent.

 Against this back drop, companies such as Cemex Philippines Group of Companies, Eagle Cement, Northern Cement Corp., Pacific Cement Corp., San Miguel Corp. and Taiheiyo Cement Philippines have indicated plans to expand.

 If supply exceeds capacity, there could even be an opportunity to export the additional supply, industry players said.

 New players are also preparing to meet the growing demand for cement.

 Phinma, for instance, registered its cement company in September 2017, aiming to produce approximately three million MT of cement per year. 

 In an earlier disclosure, the company said it would  “engage in processing, marketing, importing, trading, selling, and distributing cement, cement products, and other by-products.” 

 Recently, Phinma imported 50,000 MT or approximately two million sacks of cement from Vietnam. 

 It plans to import the same amount per quarter for a total of 200,000 MT a year.

 Phinma is headed by former Holcim Philippines top executive Eduardo Sahagun, who joined Phinma less than a year after retiring. 

 A cement company headed by Henry “Big Boy” Sy Jr. has also just recently entered the market.

 The company, known as Big Boss, is positioning itself as the “most environment-friendly cement in the world today.”  

It will use lahar materials as main component of its brand. 

Indeed, cement and steel industries are at the forefront of the so-called Golden Age of Infrastructure in the country, with the Duterte administration rolling out more than P3.6 trillion for its Build Build Build program from 2018 to 2020 alone.

In all, cement sales increased to 5.2 million tons in the first quarter of 2014, an 8.6 percent jump from the same period a year ago which is steeper than the six percent annual growth recorded in 2013 when sales totaled 19.4 million tons, according to data from the Cement Manufacturers Association of the Philippines (CeMAP).

 These figures are projected to increase in the coming years, with government committed to maintaining or even stepping up its public works program.

 Greater investment in housing from both public and private sectors, and a sharp rise expected in commercial and retail construction are also likely to boost consumption.