Holcim may hike cement prices due to higher costs

Holcim Philippines, Inc., which corners a third of the domestic cement market, may hike prices as a result of higher coal, oil and electricity costs. Ian Thackwray, Holcim chief operating officer, said that because oil, coal and electricity make up 60 percent of the company's expenses, they may have to adjust cement prices. “There are continuous small price adjustments. It may be necessary to hike prices because of... increased input cost," he said, adding that power costs more in the Philippines than any other country in Asia. The company, meanwhile, expects cement demand strengthen in the first half of 2010 and then weaken in the second semester. Demand in the first half may come from the government's infrastructure projects that need to be completed before a moratorium on new road projects kicks in. “Historically, there is a drop in demand after an election. The most important thing is the first six months of next year. We have to make sure that we have [enough] supply," Thackwray said. Besides government projects, low-cost and affordable housing will buoy the demand for cement, he said. A new kiln will boost Holcim's capacity by adding a million more tons of cement yearly. The Holcim Group said earnings went up more than nine times to P855 million in January to September as revenues improved by almost a third to P5.5 billion. Holcim has 1,500 workers at its cement plants in La Union, Bulacan, Davao, Misamis Oriental, Taguig and Parañaque. - NPA/GMANews.TV