Holcim expects Mindanao cement demand to fall, Philippines

Holcim expects Mindanao cement demand to fall, Philippines
Published: 02 July 2010

Demand for cement and other construction materials in Mindanao is expected to go down this year compared with last year’s.
William C Sumalinog, Holcim Philippines, Inc. head for Mindanao, said demand for cement in Mindanao was down by 18% compared with the same period last year.

“Last year was an abnormal year [for the construction industry],” he said, as demand for construction materials was very high because of the government’s infrastructure program particularly the repair of national roads and bridges.

But Mr Sumalinog hastened to add that private sector investment, particularly housing projects, is expected to increase. About 40% of Mindanao’s demand goes to the private sector, while the larger segment is sold to the government for its construction needs, he explained.

Earlier, a construction industry leader said investments in construction would go up to as high as 7% this year. Manolito P. Madrasto, Philippine Construction Association executive director, said that among the expected growth drivers of the industry are remittances from overseas Filipino workers, which mostly go to housing.

Mr. Sumalinog said Holcim’s operation was affected by the power curtailment during the last two months, which forced the cement firm’s management to shut down one of its two production lines in Lugait, Misamis Oriental. 

The company has two cement production complexes – one in Misamis Oriental and the other in Mindanao, which was formerly owned by Davao Union Cement.

Mr. Sumalinog said shutting down one of the two lines in Misamis Oriental resulted in the output reduction of about 1.5 million bags a month. However, he said, the company is ready to operate the plant when demand increases.