Cement industry expects robust infra business

The infrastructure business segment of the cement industry is expected to grow a robust 13 percent this year as cement firms start to feel the impact of the government’s huge infrastructure build-up.

Nabil Francis, president of Republic Cement Services, Inc., said that overall industry demand is also expected to grow 8 percent this year.

“We are starting to feel the effect of the BBB program… we are starting to feel the pulse of the market beating,” said Francis.

According to Francis, the residential segment accounts for 50 percent of cement demand and 20 percent by the non-residential (offices, hospitals, etc). The remaining 30 percent is being captured by the infrastructure segment.

Notably, the infrastructure segment is the fastest growing segment at 13 percent, which he said was a lot higher than last year. The residential sector has been steady at 5 percent, he added.

Francis further said there is still a big room for growth in the cement sector considering that per capita cement consumption in the Philippines is only 250-300 kilograms as against 600 kgs in neighboring countries.

To support the anticipated robust demand, Francis said they are increasing their running capacity by 2 million metric tons by end of next year. The company is investing $300 million for this capacity expansion program.

“We just follow the pace of the market and the situation is very interesting because the fundamentals are great,” he added.

Francis further said that their aim is not about market position but, “to follow the market pace and be in a position to supply Filipinos and the Philippines with quality cement to become a stronger republic because our name is Republic.”

“So, it is important to manufacture locally and we are very proud that we are about to see the golden age of infrastructure in the country.”