Cement producers look to import via Bangladesh

Cement producers look to import via Bangladesh
Published: 19 November 2008

Local cement makers now weigh the feasibility of several import proposals they recently received from Sri Lanka, Saudi Arabia, Sudan and Kenyan companies.

Although the industry people consider the present duty structure and high shipping charges ’unfriendly’ for the industry dependent on imported raw materials, they expect a successful tapping of the new export destinations for Bangladesh made cement on the possible decline in the international shipping costs in the wake of global financial meltdown and falling fuel prices.

Sources said competitive cost and Bangladesh’s inclusion as a cement exporting country in the global trade map prompted the private companies overseas to place queries for importing cement from Bangladesh.

The saturated capacity of the local 35 cement factories also inspired global importers to assess the feasibility of such imports. These factories can produce around 20Mta of cement against the demand for 8.5 Mta.

The manufacturers have enhanced their capacity relying on a huge demand for the item in India. But most of the cement factories are to sit idle because those are badly affected by Delhi’s stringent regulations.

On the recent import proposals, Azizur Rahman Selim, secretary, Bangladesh Cement Manufacturers Association, said, “As Bangladesh has already been listed as a cement exporting country and the price of the exportable cement is much more competitive in the global market, many international companies have placed their queries for importing the item from our country. The countries that showed interest in Bangladesh cement include Sri Lanka, Sudan and Kenya.”

When asked, Herath, minister at the Lankan High Commission in Dhaka, pointed to the fact that Colombo imports cement from many countries including Japan and Indonesia. “If Sri Lankan businessmen find Bangladesh cement competitive in terms of price and quality, they will definitely must import the item,” he said.

However, the local makers think that the export of cement to any other country than India is not feasible at the current cost and duty structure.

“A total of 33 cement factories out of the 35 factories make cement by importing clinker from China and Indonesia at a high rate of shipping cost and duties. The present cost structure is not feasible to tap the export potentials for cement,” a senior official of a leading cement factory in Bangladesh pointed out.

He demanded that the government review the present duty structure and make it industry-friendly.

“If the government exempts some duties on exportable cement and grant cash incentives, export cement exports to Sri Lanka and the Middle Eastern (ME) countries will be feasible in future,” the official went on.

Shah Cement, Meghna Cement, Aramit, Crown, Premium and Holcim export cement to the north- eastern states of India.