Cement industry expects to grow at least 2.5% in 2006

Cement industry expects to grow at least 2.5% in 2006
Published: 11 January 2006

Mexico’s national cement chamber (Canacem) believes that the industry will grow by around 2.5% this year, but factors such as the presidential elections could lift growth even further, according to local news reports. 
 
The expansion in the housing construction sector and investments in public works in the run-up to July’s elections will have a positive effect on domestic cement sales, said Canacem chairman Osmín Rendón. 
 
"The federal government and state and municipal authorities are going to ensure that infrastructure works start and finish this year," the executive was quoted as saying by the newspaper. 
 
 "This is an election year and the race for votes will have a direct impact on the race to generate jobs, visible infrastructure and the well-being of the public," added Rendón. The new president, replacing Vicente Fox, takes office in December. 
 
In addition, a possible solution is in sight to the trade conflict over cement dumping between Mexico and the United States. This could mean the US allowing tariff-free imports of 3-4Mt of cement a year, as well as reducing the duties on further imports of Mexican cement. 
 
The housing sector is set to continue growing because the country has a deficit of 4.9 million homes, Rendón pointed out.
 
 "The new financing schemes for housing, the low interest rates and the competition to grant mortgages is going to reduce the cycle of sales, so it is foreseeable that the speed of rotation of housing inventories will increase," the Canacem leader said. 
 
 Rendón believes that in the future the housing deficit will be tackled with a larger number of prefabricated homes, which have a greater concrete content, and therefore more cement is used in their construction. 
 
 The task for the industry is to remain competitive despite the escalating costs of raw materials and fuels, as well as to satisfy both domestic and international demand, added Rendón.