Lafarge: upturn on cement market in 2010

2010-02-13



Lafarge expects the present year to be more promising for the cement branch than 2009, when production shrank by 10.2% to 15.2 million tonnes, Parkiet reported.
According to estimates made by the Market Economy Research Institute, cement sales may increase by 5-7% in 2010. Lafarge representatives believe that such a target is definitely attainable as demand will be fuelled by infrastructural investments connected, among other things, with preparations for Euro 2012. Single-family construction will be another major source of demand.
As the demand for the product grows Polish cement works will be compelled to increase their output capability. However, such plans will be held in check by caps on CO2 emissions imposed on the branch by the government, and purchasing additional emission rights will be too expensive for them. No such restrictions are in force in, for example, Ukraine and Belarus, which may provide stiff competition for firms operating in Poland.
Lafarge's plans for 2009-2010 provide for investment expenditure in the region of €40m. This cash will be used, among other things, to increase output from 1.5 to 2 million tonnes a year at its Cementownia Kujawy cement plant. The company may also consider acquisitions of other cement production facilities, if any interesting and attractive targets appear on the market. The concern is currently making efforts to buy Cementownia Nowa Huta, but legal problems may delay the transaction.

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