Egypt production disrupted by gas shortages

Egypt production disrupted by gas shortages
Published: 02 May 2014


Securing sufficient fuel to operate production facilities has become one of the key challenges for Egyptian cement manufacturers with output rates dropping and input costs rising, leading to cement prices rising.

Latest industry reports state that production has come to a halt at 10 cement plants following EGAS's decision to temporarily cut off the gas supply. The plants reportedly account for approximately 70 per cent of Egypt’s cement output.

An official from the Federation of Egyptian Industries (FEI) told local press that the plants have not yet officially announced that they are stopping production. However, employees have been given over three weeks off and have extended the leave by another week,.

Plant owners are reported to be holding discussions with the Egyptian Prime Minister regarding the revision of gas prices to ensure that the cement sector can continue to operate.

The Ministry of Petroleum had initially reduced gas supplies to cement plants by 35 per cent in the first two months of 2014, according to the ministry's March report on production and consumption averages.

Egypt's Arabic-language Al Shaab newspaper has said that cement companies decided last week to raise their prices by an average EGP60/t (US$8.60), following an earlier increase of EGP40/t. It said some firms were now pricing cement at EGP930/t (US$132).