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Akcansa considers investing in Azerbaijan

World Cement,

Reports indicate that Turkish cement manufacturer Akcansa (a joint venture between the Sabanci Group and HeidelbergCement) is interested in entering the Azerbaijan market. A representative of the company is quoted as saying: “We intend to study Azerbaijani market. We are ready to consider work prospects in Azerbaijan depending on demand for cement and begin implementing long-term projects.” The representative was in Baku, Azerbaijan, with fellow Turkish businessmen.

Relations between the two countries are strong; Azerbaijan has a majority-Turk population. The Azerbaijan-Turkey Business Association, a non-governmental organization, was established several years ago and aims to promote the development of relations between Azerbaijan and Turkey with the US and other Eurasian countries. More recently, Turkey and Azerbaijan signed a deal that will allow the transit of natural gas from Azerbaijan through Turkey to the rest of Europe, which is attempting to decrease its dependence on Russian supplies.

Azerbaijan’s cement production capacity is on the rise. The country’s sole cement and clinker manufacturer, “Garadagh Cement” OJSC has been undergoing an expansion programme that will increase capacity by to some 1.7 million t by 2011. Meanwhile, Russian-owned JSC Ulyanovsktsement (part of Eurocement Group Holding) reportedly supplied 13 000 t of Cem I 42.5 N to Azerbaijan by rail in the first five months of this year. Eurocement is a major player in the region, with 16 cement plants across Russia, Ukraine and Uzbekistan. Production at JSC Ulyanovsktsement increased by 46% y/y in the January to May period, illustrating the demand scenario in the area.

Akcansa is currently a leading cement producer in Turkey, but with that market fully immersed in an overcapacity situation it is hoping to branch out beyond the country’s boundaries.

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