Truce in Lebanon boost UAE shares
Shares in UAE cement companies reacted strongly to the Lebanese ceasefire this week as prospects increase of infrastructure and property reconstruction in the war-torn country. Although UAE companies such as Union Cement, Gulf Cement and Ras Al Kaimah Cement focus mainly on the domestic market, experts say resources pulled from other parts of the Gulf will create gaps in demand which could be filled by local companies.
The possible trend saw a recent rally on the Abu Dhabi market, with cement companies alone accounting for Dh31 million worth of transactions. It follows soaring cement prices earlier this year, followed by fears of over-supply and a price crash, encouraging suppliers to offload stock.
Mike Richardson, general manager of Ras Al Khaimah Cement, said any benefit to the company from a possible re-construction of Lebanon would be "extremely indirect".
"I do not envisage our cement going to Lebanon. We supply to the UAE market and to Iraq on a small scale and we are already at full production," he said. But Richardson said increased supply pulled from Saudi Arabia and Jordan, Lebanon’s traditional sources of cement, could create a supply deficit in areas closer to home, such as Kuwait.
Officials at Ras Al Khai-mah Company for White Cement and Construction Materials also said logistical barriers prevented them from exporting their products to Lebanon, while countries including Iraq provide better opportunities.
Published under Cement News
