Ukrcement expects cement production decline in 2013

Ukrcement expects cement production decline in 2013
13 February 2013

Ukraine's Ukrcement association expects cement production to fall 5-7 per cent (by 489,000-684,000t) in 2013, against 9.089Mta-9.284Mta in 2012, executive director of the association Petro Lopatiyev reported.

At the same time, he noted that a number of experts and market dealers consider the forecast to be quite an optimistic one. Lopatiyev noted that the expected slowdown in the cement production is likely to take place due to the unfavourable situation in the construction market.

"We do not expect any considerable growth or any stabilisation in the construction market. What is the reason for that? The reason is probably the state budget that envisions no capital construction programmes, or the budget deficit, as well as the recession of the global economy," he noted.

According to the association, in 2012, cement production fell by seven per cent to 9.773Mt, while clinker production decreased by 16 per cent to 6.279Mt when compared with 2011 figures.

Lopatiyev estimated the utilisation of the domestic cement enterprises is currently at 46 per cent and the association fears the growth in cement imports.

In 2012, the stake was about one per cent and the import volume was less than 100,000t (94,516t under the State Statistics Service's (SSS) data).

However, the association is concerned about dumping in the Ukrainian market,  particularly in view of the stagnation experienced in the construction market and the lower prime cost of cement production in Transniestria.

In such a situation, the association calls for the Ministry of Economic Development and Trade to address the issue with an initiative to hold an anti-dumping investigation.

According to the SSS, in 2012, cement production dropped by 6.8 per cent against 9.801Mt in 2011.
There are over 15 firms engaged in cement production with the total capacity of over 20Mta.

Published under Cement News