Saudi Arabia’s cement sector is facing the road to recovery
30/10/2010 9:47:54 AM
Saudi Arabia’s cement sector is facing the road to recovery as a result
of high public spending and improved economic conditions. Al-Jouf
Cement’s 180 000 t plant was recently brought onstream, contributing to
the nation’s total production growth, which has increased by 13.9% to
32.2 million t. 96.2% of this was represented by the domestic market,
with foreign markets accounting for 3.5%.
The cement industry in Saudi Arabia has struggled of late, with
demand slowing and prices weakening. Net profits of the eight listed
companies have also dropped 16% y-o-y. NCB, the largest bank in Saudi
Arabia, said, “thus, the overall net profit of the eight listed
companies dropped by 2.6% to SR 2821 million in the first nine months of
2010 over SR 2897 million in the same period of last year. Investors
responded in a subdued fashion to listed cement companies, causing a 2%
drop in their stock prices so far this year. As the construction sector
recovers, the demand for cement will start to pick up in a paced
fashion.”
Saudi Arabia’s 2010 budget aims to maintain an expansionary fiscal
policy, which would support the demand for cement. Plans are also in
place to outlay US$ 400 billion on infrastructure over the next five
years. Furthermore, a combination of licences for new projects and
expansions of existing plants is forecast to push the nation’s
production capacity to 54 million t by the end of this year.
Published on 25/10/2010
Van Anh
By: worldcement