South Africa: 2011 cement volumes to replicate 2010

South Africa: 2011 cement volumes to replicate 2010
Published: 06 July 2011

Lafarge Cement CEO, Thierry Legrand, noted that although sales in South Africa had decreased by 2.8% since the beginning of the year, "We have recently started to see an increase on the daily sales. In April it went up by 6.7% and rose 2% in May. If this trend continues we can expect 2011 volumes to be similar to 2010."

Lafarge Cement operates a 2.4Mta clinker facility at its main Lichtenburg site in the North West Province, South Africa.

The group invested ZAR1.2bn (US$117.6m) to increase its cement capacity, particularly at its Randfontein site. The factory in Randfontein came on-stream at the end of 2009. It has the capability of producing 1Mta, or 4800tpd, at full capacity.

"We are currently using around two-thirds of our capacity," Legrand said to BusinessLive. To offset the market slowdown, the CEO said that Lafarge worked at effectively reducing costs while intensifying its presence in the market. "More than ever we endeavour to support our customers’ needs while promoting the Lafarge brand. An example of this is our Roadcem, a product extremely well adapted to address road stabilisation needs," he said.

"There are some positive signs on daily cement sales. Residential building plans are going up. We think the market could end this year at the same level as 2010, the coming months will confirm. We hope for a more serious recovery in 2012 and more growth in infrastructure," he concluded.

Cement sales in South Africa moved 2.8% lower YoY in May to 912,585t, from 939,318t in May 2010, data from the Cement and Concrete Institute showed.

Sales were 816,338t in April. Domestic sales on a YtD basis declined 2.1% to 4.2Mt, from 4.291Mt for the same period in 2010. The moving annual total in South Africa was down 4.8% YoY in May to 10.779Mt from 11.325Mt in May 2010.