Philippines: Republic Cement Services Inc (RCSI) is considering building production facilities in Visayas and Mindanao following a government drive to improve the country's infrastructure.
According to RCSI president Don Lee, the move is in response to announcements made by the Department of Public Works and Highways (DPWH) that more projects were needed in the regions. "At this point, DPWH is more aggressive in visions, projects and allocations of the budget in Visayas and Mindanao," said Lee. The Public Works department, he said, needs to ensure that the local industry has enough capacity to serve the country's development needs. "It is sending us a reminder to be faster in having more cement capacity in Visayas and Mindanao." Lee said that expansions by cement companies are critical for sufficient raw material supplies for energy, water, telecommunications and transport projects. Included in RCSI's upcoming expansions are an 800,000t/yr grinding plant in Norzagaray, Bulacan that is expected to be operational early in 2016.
Lee said that the Cement Manufacturers' Association of the Philippines had reported a year-on-year cement demand increase of 18% in the third quarter of 2015. "I think that for the full year, we're about 13.5 – 14%. We have one of the healthiest cement markets in the world, driven by construction in infrastructure, individual homes and mid-high rise constructions," said Lee.
Lee said he was also confident that Republic Cement would be able to post above industry growth. "With our new capacity coming on and new shareholders, we are in a good position to develop new projects and continue to invest ahead of demand. Our two new parents are financially healthy," said Lee.
RCSI is a joint venture between Aboitiz Equity Ventures Inc and CRH. The two companies secured 99.09% ownership of Lafarge Republic Inc, which operates the Republic Cement brand, for US$530m.