Mikhail Baghdasarov forecasts drop in cement prices in Armenia

Mikhail Baghdasarov forecasts drop in cement prices in Armenia
Published: 07 July 2011

President of Mika Cement CJSC Mikhail Baghdasarov forecasts a drop in cement prices in Armenia after modernisation of its Hrazdan plant. “The price may drop after modernisation,” Baghdasarov told a press conference in Yerevan.

He said that German specialists are presently completing modernisation of the packing line. This new line will be presented at the 40th anniversary of the plant.

The first stage of the modernisation represents an investment of US$4m, according to Baghdasarov.  The next stage foresees the transformation of the wet-process kilns to dry-process facilities to reduce water usage and costs.

Baghdasarov noted that the Hrazdan plant is old and due to the long (185m) length of the kilns too much gas is consumed. As a result, the price for cement now exceeds US$100/t and he envisages that after the upgrade this will fall to a cost value of US$40/t. However, actual cost values will be higher at US$70/t to pay creditors. In this respect, the president noted that after modernisation of the plant the price for cement will be lower, but “not so low, as after we cover credits.”

Baghdasarov also touched upon construction volume in Armenia, which is still far from that of pre-crisis years. He expressed hope that the cement sales volume will increase due to the new concrete highway construction in Georgia, and as a result of the possible construction of new nuclear power plants in Armenia.