The cement market is prepared to increase its capacity and keep pace with growth in construction in the country.
Cemex and Holcim, cement companies founded with foreign capital in the domestic market, say they are prepared to increase their capacity and thereby keep pace with growth in construction in Nicaragua.
These companies will continue to expand their investments in 2014.
A ruling states that the already concentrated Honduran cement market will not be altered by the sale of shares to the Colombian company Argos.
From a press release by the Commission for the Defense and Promotion of Competition (CDPC):
The Commission for the Defense and Promotion of Competition (CDPC) as part of its advocacy of free competition within the framework of its powers and in relation to economic concentrations, was notified about a project of economic concentration in the Cement Industry, involving the economic agents Cementos Argos, S. A de C.V. (buyer) and Lafarge Cementos S.A. Unipersonal (seller).
Mexico's Cemex will build a new plant for grinding and packing under an agreement with the Compañía Nacional Productora de Cemento.
From the statement released by Corporaciones Nacionales del Sector Público (CORNAP):
Memorandum of Understanding Signed Between Cementera and CEMEX Nicaragua
Thursday, November 21, 2013
The Chairperson of the Board of the Compañía Nacional Productora de Cemento (CNPC) Carmen Reyes García and the representative from CEMEX Nicaragua, Andrés Jiménez Uribe signed a Memorandum of Agreement where the Mexican government authorized the construction company to install and operate a plant for grinding and cement packing facilities outside the cement plant located in San Rafael del Sur.
The construction of megaprojects has caused a high demand for cement and an increase in the prices of the main material for the construction industry.
The fact that only two companies (Argos, and Cemex) lead the Panamanian market has caused prices to skyrocket because they are setting the price of this item. Experts expect that when demand for this raw material decreases, so will prices.
The construction of the hydroelectric station Tumarín, and the eventual realization of the Grand Canal project, have created great expectations for business deals in the sector.
Holcim is waiting for clear signals about the canal project, a project that could represent a great opportunity for the company.
On the other side is the hydroelectric station Tumarín, over which they have had been making approaches for several years, even though it has not yet fully started. "While the company has had to reorganize, expand its staff and equipment, and increase its investments in order to keep pace with the growth of the sector, the construction of the canal (a Pharaonic project) will force the two cement companies to work flat out to meet the requirements for the work," noted an article in Confidencial.com.ni.
Cementos Progreso has announced an investment of $720 million in the construction of the San Gabriel plant with capacity of 2.3 million tons per year.
"Adding this to the capacity of the San Miguel plant, located in Sanarate, El Progreso, the company will be able to offer the market five million tons of product every year", reported Prensalibre.com.
The supply contract calls for approximately 500 thousand tons of cement.
CEMEX, S.A.B. de C.V. (NYSE: CX) announced the signing of a supply contract with “Consorcio Grupo Unidos por el Canal”, the primary contractor for the construction of the third set of locks of the Panama Canal expansion project.
The CEMEX contract represents an integral phase of the Canal expansion project, which includes two locks, the excavation of access channels to the new locks and the widening and deepening of navigational channels.
The Colombian company Argos Cement has signed a contract to provide cement and other products to support the canal expansion.
According to information provided by Argos, the cement will be produced at the company’s Panama site, complemented as necessary by additional volume from the plant Argos has in Cartagena, Colombia.
The company plans to begin supplying cement in December and will continue until the first quarter of 2014.
In the face of a 20% to 30% decrease in the demand for cement and concrete, the multinational closed five of its concrete plants.
Of the three production lines that Cemex has in Costa Rica, cement, concrete and aggregates, the concrete sector has been hardest hit by the crisis. With the closing of the 5 facilities, there are only 3 left operating.