Skip to main content

Cement results from the GCC countries in 4Q11

World Cement,


4Q11 GCC cement industry resultsĀ 

Profits in the cement sector rose by 2.3% y/y in 2011, with net profits increasing from US$1 440 million in 2010 to US$1 477 million in 2011. However, the average cement price fell by 4.9% to US$64.9/t. Although prices in Saudi Arabia and Qatar increased slightly, they declined in Kuwait, UAE and Oman as companies cut prices to compete for contracts.

Saudi Arabia

The ban on cement imports to Saudi Arabia has been lifted after demand soared from less than 20 million t in 2005 to 49 million t in 2011. The report suggests that Oman and the UAE will benefit most from the removal of the import ban, due to low cement prices in these countries.

Cement demand increased by 10.9% y/y and cement dispatches grew by 15.8% y/y in 2011. The construction industry is expected to experience continued growth as around SAR1.5 trillion (US$400 billion) is to be spent on large infrastructure projects over the next five years, as well as a SAR290 billion homebuilding fund. Average realisation prices rose by 6.6% to SAR244.9/t.

Oman

Sales revenue increased by 12.8% to US$342.3 million. Cement demand grew due to government initiatives preventing UAE suppliers from dumping cement at lower prices. Demand is expected to increase next year as infrastructure development continues in the region. However, cement prices fell by 19% from US$79.4/t in 2010 to US$64.1/t in 2011. This is the biggest decline in prices from all the GCC countries.

United Arab Emirates

The cement industry witnessed a 6.4% y/y increase in consolidated revenues to US$945 million. 4Q11 revenues grew 13.9% q/q and 23.4% y/y. This can be attributed to a slight increase in demand in Abu Dhabi and exports to regional markets. However, the average cement price declined by 5.3% to US$49/t.

Qatar

Consolidated revenues decreased by 5.2% to US$325.3 million in 2011 from US$343.1 million in 2010. The decline has been attributed to lower cement demand and new entrants in the domestic market. Prices remained flat at around US$70.1/t and are expected to remain so.

At the end of February 2012, the government announced the closure of 14 quarries for environmental reasons.

Qatar National Cement Company plans to increase its cement capacity by 0.93 million tpa to 5.36 million tpa in expectation of increasing demand.

Edited from the GCC Cement Sector Quarterly Report by Global Investment House.

Read the article online at: https://www.worldcement.com/africa-middle-east/26032012/cement-sector-in-the-gcc-countries-experiences-a-y-y-profit/


 

Embed article link: (copy the HTML code below):