Holcim’s Campulung plant to become Bucharest’s largest supplier

Holcim’s Campulung plant to become Bucharest’s largest supplier
Published: 31 January 2008

Holcim Romania, which last year generated turnover worth 290 million euros, up 28% on 2006, will finalise an investment worth 185m euros in order to increase the production capacity of its Campulung plant this year, and thus become the largest cement supplier on the Bucharest market, considering the Arges county-based plant is the closest to the capital.

In fact, the Swiss company increased initial investments, estimated at 120 million euros and aimed at the construction of a new production line, by 50%, after it decided to build two silos for cement storage and expand its logistics capacities.

The investments in Campulung will be completed after last year cement producers revealed they were unable to meet market demand.

"Cement production in Campulung will primarily be destined to Bucharest’s construction industry where materials are in high demand. As a result, we should not have any difficulty in covering market demand this year," Markus Wirth, Holcim Romania CEO, told ZF. If market demand is too high in the coming years, Holcim representatives will consider building a new plant, which would take three or four years and cost 200-300 million euros.

In parallel with investments in Campulung plant production, the company also acquired several hundred hectares of land, where they plan to start a new limestone quarry. "The current stone quarry will be closed down gradually. We’ve acquired hundreds of hectares of land to start a new limestone quarry that we want to lease from the National Agency for Mineral Resources," explained Wirth, who chose not to reveal the value of investments.

Holcim, which has a 28-30% share of the market, has earmarked investments worth 135m euros this year in order to finalise investments in Campulung, modernise all production facilities, open 2-3 concrete-mixing stations and two aggregate stations, and expand its commercial fleet.

In 2007, Holcim carried out investments worth 123 million euros, in environmental protection, business development, social and human resource projects, and the modernisation of production technologies.

Other projects in 2007 included the continued modernisation of the plant in Campulung Muscel, a new environment-friendly concrete mixing station in Pantelimon, Bucharest, and a new aggregate station in Gligoresti, Cluj county.

Cement prices are expected to increase by around 10-12% this year (similar to last year’s growth rate) due to rising costs related to utilities, raw materials, taxes and labour.

In Romania, Holcim owns three cement plants, in Turda, Campulung and Alesd, 16 environment-friendly concrete-mixing stations, and 5 aggregate stations.