Siam City Cement may cut capacity, Thailand

Siam City Cement may cut capacity, Thailand
Published: 04 March 2009

Siam City Cement (SCCC), Thailand’s second-largest cement company, may reduce its capacity utilisation unless state megaprojects begin this year.

The company projects an 8-12% fall in consumption in the local cement market this year as the global downturn dampens construction.

"The industry slump will also dampen the company’s sales performance. The best we can do is try hard to maintain our market share," said Kantanit Sukontasap, vice-president for group communications.

"The only positive factor we are hoping to see is the megaprojects. Such projects would partially lift cement sales and improve business sentiment in the construction sector and property."

SCCC currently holds a 27% share of the local cement market. Unless demand is supported by the megaprojects, Mr Kantanit said the company might shut down a cement furnace, cutting its daily production capacity by 5,500 tonnes.

"This decision would be made in our worst-case scenario," he said.

The company was operating six cement kilns but shut down two kilns with a total daily capacity of 11,000t early last year. The remaining four produce a total annual output of 10.48Mt.

"However, there will be no layoffs. If we have to shut down a third one, around 30-40 workers operating in that unit will be transferred to our industrial-waste management business," said Mr Kantanit.

Source: Bangkok Post