The Philippine Yuchengco group of companies and businessman Eduardo Cojuangco Jr. are putting up separate cement factories with a minimum investment cost of P1 billion each. Industry sources said construction of Cojuangco’s cement facility in Bulacan was already under way while the Yuchengco camp had not disclosed the location of its proposed cement plant.
Cojuangco, who is chairman of food and beverage giant San Miguel Corp., has an existing cement company, Northern Cement Corp., in Sison town, Pangasinan. Industry sources said Cojuangco’s new cement manufacturing plant will be under an entirely new company.
The Yuchengco project is the group’s first foray into cement production. The group is engaged in banking, finance, investment management, manufacturing, construction, mining, real estate development, trading, power generation, oil exploration, telecommunications, fastfood and agribusiness.
Cojuangco and the Yuchengco group are putting up greenfield cement plants, which will entail no less than P1 billion in investments. Both plants will have a minimum capacity of 1Mta.
Consumers welcomed the new development, with the two new entrants in the cement industry seen to eventually bring down the cost of the commodity in the country. “Cojuangco and the Yuchengco group are two serious investors. Consumers generally expect them to give competition to the cartel,” an industry source said.
Cement production has been identified by government as one of the priority sectors where investments are needed to build up new capacity amid projections of possible shortfall in the next few years. Higher investments on infrastructure are expected to increase cement production although demand remains weak. Overall demand fell 4.3 per cent last year to 11.58Mt, the third year in a row that consumption has gone down. Demand peaked in 1997 when consumption reached more than 14Mt.