Camargo Correa expands cement operations

Camargo Correa expands cement operations
Published: 05 October 2010

Camargo Correa has approved investments of R$3.6bn (US$2.12bn) from 2011-16 to expand its cement operations via the filial Camargo Correa Cimentos. The sum is part of a R$14bn spree announced by the company that includes the acquisition of 33% on the Portuguese cement company Cimpor in a deal worth R$3.5bn.

Other investments would expand the capacity of Loma Negra in Argentina and to set up a foothold in Angola, Mozambique and other South American countries. Camargo Correa Cimentos should expand by 75% the cement capacity in Brazil of currently 8Mta and president Humberto Junqueira de Farias anticipates a heated demand over the next five years. Camargo Cimentos ended 2009 with a 10% share in the national market, and should have 15% of it within five years, when De Farias expects the market to be 81Mt from 64Mt expected in 2010.

Capacity expansion would bring the company to have a presence in the Northeast and North regional markets, to have local plants integrated with mining operations, each with 1mil mtpy and costing investments of US$250mil. Camargo has a small 300,000tpa milling unit in Suape (Pernambuco). It concentrates in the Southeast and South markets. The first step towards national coverage would be a 800,000tpa  plant to Cubatao (Sao Paulo) not far from the Usiminas steel mill, and with completion slated for 2011; the following year the Ijaci (Minas Gerais) plant would double up capacity from 2Mt to 4.4Mta. This new unit is to replace the output of the Apiai (Sao Paulo) plant that would supply the demand in Southern Brazil. Cement business have accounted in 2009 for 14.1% of the R$16.2bn net income of Camargo Correa group that sold 10.2Mt of cement in Brazil and Argentina.