Egypt: Gas prices increase for cement firms

Egypt: Gas prices increase for cement firms
Published: 07 July 2014

Tagged Under: Fuel Egypt 

The government has raised gas prices for Egyptian cement factories to US$8/m British Thermal Units (BTUs) compared to US$6 previously, while fuel oil increased from EGP1500/t (US$209.8/t) to EGP2250/t (US$314.7/t).

An official cement company spokesperson anticipated cement prices to increase in the coming days due to higher production costs. A number of cement companies operating in Egypt are looking to use coal as an alternative source of energy this year.

“Energy represents 60 per cent of cement production costs and any increase in energy prices have a direct influence on final prices,” said the source, “We do not yet know the impact of increased energy prices on consumers as cement prices are also affected by supply and demand.”

“Gas is generally not available and we are experiencing a large and persistent deficit in its supply which has reduced our production capabilities,” he said.

The source ruled out these companies’ resorting to importing gas at this time due to high prices for the process, valuing up to US$14m BTUs.

Suez Cement announced that it would be shifting to a fuel mix comprising 80 per cent coal and 20 per cent waste material. Misr Beni Suef Cement Company announced it will be using diesel to keep at least one of its production lines operating.