Philippine cement demand falls 6.7% in first-quarter 2011

Philippine cement demand falls 6.7% in first-quarter 2011
Published: 15 April 2011

Cement sales in the Philippines dropped 6.7 per cent in the first quarter of the year after huge election spending fuelled an usually high growth in cement sales in the same period in 2010.

Cement Manufacturers Association of the Philippines president Ernesto M. Ordoñez told reporters that sales dropped to 3.8Mt in the January-March period this year from 4.076Mt in the same period in 2010. Total sales in 2010 stood at 15.5Mt.

Ordoñez explained that election spending in May 2010 has fuelled growth in cement sales in the first quarter of that year.

“2010 was driven by elections spending and Ondoy repairs,’ he said. Capacity utilisation of cement plants is expected to remain at 60 to 65 per cent while demand at 15-16Mt.

With the lower first quarter growth, Ordoñez said, the industry may revise its four percent growth projection for the year.

Meanwhile, an industry source said that CeMAP is planning to ask the Department of Trade and Industry to intervene as some companies are incurring losses due to the high cost of coal and fuel cost.

Cement plants are using coal imported from Australia. According to industry players, Australia has raised prices following the huge flooding.

On the other hand, cement manufacturers cannot increase prices because of low demand and stiff competition.