24 December 2009
Price of cement in Abu Dhabi continues to remain stable despite an increase in the cost of aggregates.

According to figures released by the Statistics Centre Abu Dhabi, the price of aggregates increased by almost 13 per cent this week.

A senior industry official said various factors, including a duty imposed by Oman, could have resulted in the increasing cost of raw materials used in the manufacturing of cement.

A tonne of crushed aggregate 3/8 increased by six per cent to Dh75 from Dh70 last week. Similarly the cost of ordinary aggregate ? rose by 11.53 per cent to Dh65 per tonne from Dh57.50 per tonne last week.

The ? variety of crushed aggregate registered a 13.3 per cent increase to reach Dh75 per tonne compared to Dh65 last week.

Mohammed Noorullah, Factory Manager, Rock Cement Industries, said: "From December 1, Oman had introduced duty ranging between five and 10 per cent on exported materials. Also, the transportation cost has marginally risen. These are some of the factors that could have resulted in the increasing price of raw materials. Demand wise there has not been any change during the past few months. Thereby cement prices will continue to remain the same," said Noorullah.

The prices of most other building materials remained stable, apart from a decline of about nine per cent in the price of a category of block cement and block concrete.

There was a marginal decrease in the price of high tensile steel and wood compared to prices last week.

Price of sulphate resistant cement dropped by five per cent going down from Dh315 to Dh300 per tonne.

The price of portland cement and white cement remained the same as last week, at Dh280 and Dh555 per tonne, respectively.

Price of solid block concrete fell by Dh360 per cubic metre going down from Dh5100 last week to Dh4740. Similarly price of block cement vacuum dropped by Dh300 to stand atDh3250 currently.

Meanwhile, according to a NCB capital report on the cement sector in Saudi Arabia, the year-on-year domestic sales rose by 15 per cent in November 2009.

However, this falls below the 22 per cent increase witnessed year-on-year during the first 10 months of 2009.

According to the report the decline in the November figure was a result of slower demand in the region.

Saudi Arabia has 12 cement companies with an estimated annual production capacity of 49 million tonnes. Total sales last month, including exports, stood at 3.11 million tonnes compared to 3.19 million tonnes in October 2009 and 2.12 million tonnes in September.

Sales in November 2008 was 2.66 million tonnes.

In November 2009, cement and clinker sales in Saudi Arabia were up by 15.7 per cent year-on-year to 2.98 million tonnes.

On the other hand, month-on-month sales saw a 2.0 per cent fall from 3.04 million tonnes in October 2009.

Only two companies, City Cement and Najran Cement, both private players, reported an increase in sales month-on-month.

All the listed players reported declines in sales on month-on-month basis.

On year-on-year basis, all the companies, except Yanbu Cement, reported an increase in sales volumes. The kingdom's cement exports during November this year reported declines despite the removal of conditional export ban in October 2009. Exports fell to 131,000 tonnes compared to 142,000 tonnes in October 2009 and 82,000 tonnes in November 2008. Exports of Northern Region Cement fell to 41,000 tonness last month compared to 71,000 tonnes in October. Saudi Cement reported exports of 70,000 tonnes in November compared to 60,000 tonnes in October. Northern Region Cement's export of clinker remained flat at 52,000 tonnes last month.

As far as production is concerned, Saudi Arabia produced 3.15 million tonnes of cement last month, up 21.1 per cent year-on-year and increased moderately month-on-month from 3.13 million tonnes in October 2009.

While on a year-on-year basis only Yanbu Cement and Saudi Cement saw a fall in production, on a month-on-month basis most of the companies reported decline.

© Emirates Business 24/7 2009