Cemex, owner of Latvia’s Broceni cement production plant, plans a 20% price rise in Latvia in 2006, the company reported.
Cemex Polish and Baltic president Ruehdiger Kuhn explained that prices in Latvia have to level out with prices in other Baltic states to make Latvia more attractive to suppliers from other countries. The price rise also has to cover inflation rate.
Kuhn said that Latvia currently had the cheapest cement among the Baltic countries. One ton of cement costs EUR40.9 in Latvia, EUR47 in Estonia and EUR50 in Lithuania. Kuhn explained that there had been historic reasons for the low cement prices in the Baltics as demand for the product was low and local producers were able to cope with it.
However, the demand for cement has increased considerably and the low prices make the independent suppliers sell their products in the countries where they can earn more money. Therefore cement deficit problem arose.
Kuhn also said that Cemex planned to invest USD50m into modernisation of the cement plant in Latvia to increase the production capacity three times. The project could take 26 months and could be started at the beginning of 2006.
Currently there is cement deficit in Latvia’s construction market caused by the increased construction activities, insufficient output by Latvia’s Broceni cement plant and decrease of the imported cement.