Brazilian cement producers will invest around 5.5bn reais (US$3.4bn) by 2012 to expand production capacity by 35% in response to growth in demand, local financial newspaper Valor Econômico reported.
By the end of the investment cycle, the cement companies expect to have a production capacity of 80Mta.
Votorantim, which holds a market share of more than 40%, is leading expansion in the sector. The company will invest BRL3.2bn in modernisation and the construction of new plants in different regions of the country.
Camargo Corrêa, Holcim, Cimpor and Itambé have also confirmed expansion plans. They will invest a combined 2bn reais.
Demand has been boosted by growth in the real estate sector. Lower interest rates and rising incomes have increased the number of so-called informal constructions - small residential works administered or carried out independently by individuals. More than 60% of the cement sold in Brazil is in 50kg sacks.
At the same time, industrial construction has grown more than expected, mainly due to federal growth acceleration plan PAC.