LatAm: growth and challenges

Published 08 September 2014

With the XXXI FICEM Technical Congress on the horizon in the Dominican Republic, Scotiabank GBM provides an overview of recent activity in the Latin American cement market. It finds favourable market dynamics in most areas of the region but also key challenges ranging from stretched capacity to supply glut. By Francisco Suarez & Ramón Obeso, Scotiabank Inverlat SA, Mexico.

While the Latin American market can look forward to a period of growth, both local overcapacity and

supply shortages offer challenges for the region’s producers

Most Latin American cement markets show favourable dynamics. Moreover, a sound outlook for cement prices in key regions and stable-to-declining unit costs are underpinned by efforts made by the main cement companies to achieve greater efficiencies.

Nevertheless, there are also major challenges in the region. For instance, stretched capacity and sound momentum in Colombia stand in stark contrast with excess capacity seen in Mexico, where the cement market is displaying a timid rebound after a major downturn. Peru, on the other hand, has lost much of its momentum, but the greatest potential remains in the north of the country.

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