Top European cement companies eye region

Leading European cement companies like Cemex, Rosy, Unilan and others are planning to sell their excess cement capacity in the UAE and other Middle Eastern countries as demand in Europe and United States slumps due to the slowdown in construction activities.

This will result in tough competition with local cement manufacturers in the months to come.

Leading industry sources told Emirates Business that big cement companies from Europe, which are vertically integrated with other cement producers and consumers like ready-mix firms, are now ready to absorb the transport cost to bring surplus cement to the Middle East. High transport cost was the main factor preventing the globalisation of cement industry until the current economic slowdown and low oil price.

Tony Martinez, Middle East and European Representative of Columbia Machine Incorporated, a company working closely with cement and remix companies from around the world, said: "Major cement companies in Europe are sitting on idle capacity because there is economic slowdown everywhere. Construction industry has slowed down in Germany, the United Kingdom and other big markets and cement companies are keen to export their surplus capacity to the Middle East where cement shortage was a serious problem last year."

He said big European cement companies, which are vertically integrated, plan to absorb even the huge transport cost to attract UAE and Middle Eastern customers.

Martinez said: "Currently, cement price in Europe ranges from €80 (Dh370) per tonne to €95 per tonne. There are three quality cements and the price is fixed by the big European manufacturers. Now there is excess capacity and companies are keen to sell more cement in the UAE and Gulf."

The main reason keeping them away is the lack of port facilities for bulk cement imports. "It is not the high transport cost that keeps European cement from the Middle East. Rather it is the shortage of port facility to load and unload cement. Even in Dubai, the existing ports can handle only one ship per day. There are similar limited facilities in Oman and Bahrain," he said.

If there was enough handling facility, European cement would have already flooded the market, he said.