Cement makers look to brighter days

Local cement makers see bright prospects for the days to come as the government plans to embark on some big civil engineering projects in Bangladesh, including the Padma Bridge.

Some local companies are enhancing their production capacity, as domestic demand has consistently been on the rise for the past few years, except for 2007, along with increasing government initiatives, sector people said.

The government plans to complete construction of the 6.15-kilometre long Padma Bridge, which will be the largest civil engineering project of Bangladesh, and Dhaka-Chittagong express highway in its tenure.

The government's plans to set up several flyovers in Dhaka under the strategic transport plan and build 142 bridges across the country are expected to bring vibrancy to the cement sector.

"As local companies have improved a great deal in the last few years, construction firms are now collecting cement from local sources for big public projects," said Gopal Krishna Bagchi, a researcher and development official of Shun Sing Group, which manufactures the Seven Rings brand cement.

The sector people said local cement was used in a few recent public construction projects, including the Bhairab Bridge, and the Sixth Bangladesh-China Friendship Bridge (Mukterpur Bridge) in Munshiganj.

But local cement makers were not in the same condition 10 years ago.

During the construction of Bangabandhu Bridge on the Jamuna river, the constructing firm -- Hyundai Engineering and Construction Co Ltd -- had to set up a cement factory of its own to ensure cement supply to the mega project.

The local cement sector has since come a long way, meeting domestic demand and exporting to neighbouring countries.

Presently there are 30 operational cement companies that can produce around 20 million tonnes of cement a year against a demand for 8.5 million tonnes.

"Assuming high domestic demand in future, we are expanding our production capacity to meet requirements " said Bagchi.

An official of Holcim (Bangladesh) Ltd said the company was also expanding its production capacity by 0.6 million tonnes due to consistent consumption and export growth.

"Cement consumption in Bangladesh is expected to witness growth of 13 percent in 2009, rising from 8 percent last year," said Shankar Kumar Roy, general manager (Business Development) of Holcim.

Mostafa Kamal, president of Bangladesh Cement Manufacturing Association, said though cement consumption is growing, local manufacturers have to keep a large portion of their factories idle, as "local factories will be able to produce in full swing when those public construction works begin".

Kamal urged the government to give local cement manufacturers the same facilities as for the foreign companies for supplying cement to the public projects.

During construction of Bangabandhu Bridge, the government offered duty free facilities to the constructing firm to import machinery and raw materials for cement.

"All cement companies might not be able to supply cement to big public projects for not having large production and supply capacities," Bagchi said.

Bangladesh exports around 12,000-14,000 tonnes of cement a month, mainly to India.