Azerbaijan’s key cement producer halved output against its decline in 2009

Azerbaijan’s key cement producer halved output against its decline in 2009
Published: 12 February 2010

Garadagh Cement OJSC, the major cement producer in Azerbaijan, lowered manufacture of cement in 2009 against its original targets.

GC informs that for the past year production totalled 1.2Mt versus 1.3Mt a year earlier. “Output fall turned out less of our expectations but it could be much lower if not import of cheap cement in the country,” the company said.

Nevertheless, in 2009 GC increased its market share from 35 per cent up to 40 per cent. “According to our estimates, last year cement market made up 3 million tons, although we expected its decrease only to 3.2Mt. Nevertheless, one can hardly compare the 2009 demand with the demand in 1996-97 (700,000-800,000tpa). If not crisis phenomena, already today Azerbaijan’s cement market capacity would reach up to 5Mta,” GC informed.

Earlier GC predicted reduction of cement demand from 3.7Mt in 2008 to 3.2Mt in 2009. In fact, it turned out that demand dropped by 19 per cent and GC manufacture only by 7.7 per cent. As a result, its market share rose from 25 per cent following 2008 up to 40 per cent.

Earlier GC’s shares at the market diminished 70 to 42-43 per cent. The Company linked that with growth of the market and its temporary lack of a possibility to increase production capacity. Currently the GC factory is conducting actively work on construction of a new kiln with capacity of 1.7Mt of cement a year.

In 2006 GC manufactured 1.28 Mt of cement that ensured for it a 48 per cent share at the market and in 2007 its output reached 1.34Mt that provided 42 per cent market share.