Eagle Cement chairman Ramon Ang on Tuesday said that imported cement is hurting the local cement manufacturing sector, but he is still hopeful to sell 35 to 37 million tons of cement this year.
On the sidelines of the company’s annual stockholders meeting, Ang – who is also the president and CEO of San Miguel Corp. — revealed that their company accounts for 14 percent of cement manufactured locally.
“Investments in the country’s infrastructure is seen as one of the key drivers of economic activity in the Philippines over the next few years, and as such, we want to make sure that Eagle is well-positioned with increased capacities and new facilities to meet consumption requirements in the future,” said Ang.
Local cement manufacturers have experienced negative effects on the rise of imported cement in the country and they are expressing confidence that the Tariff Commission would uphold the imposition of a higher and definitive measure against imported cement.
Earlier, the Cement Manufacturers Association of the Philippines (CEMAP) said the surge of imported cement has negatively affected the domestic cement industry even as the Department of Trade and Industry (DTI) imposed a safeguard measure of P8.40 per 40-kilogram bag of imported cement.
CEMAP executive director Cirilo Pestaño II said the industry is hoping the Tariff Commission would uphold the Trade department’s order.
“We are confident the Tariff Commission will come out with a ruling consistent with the national interest after the finding of its technical staff that imports have increased their share of the domestic market at the expense of the Philippine cement manufacturing industry,” said Pestaño.
According to the findings of the technical staff of the Commission, imports have increased their share of the domestic market to 17 percent at the end of 2017 from nearly seven percent of domestic cement production of 23.4 million metric tons.
He said cement imports surged 64 percent to 1.74 million MT in January to March this year from 1.06 million tons in the same period last year despite the imposition of the safeguard duty effective 21 February.
The DTI earlier imposed the safeguards against imported cement, noting that the local cement industry directly employs some 42,000 workers, with an additional 125,000 jobs contributed through the value chain.
Eagle Cement Corp. also announced that it gained a P77.1 billion market capitalization in 2018 — a 4.6 percent hike from the previous year despite imported cement taking up 35 to 40 percent of the country’s total cement industry.
Eagle Cement president and CEO John Paul Ang said that its total assets grew by seven percent at P45.5 billion and its liabilities also declined by three percent to P12.6 billion.
Ang noted that the company’s current gearing gave them flexibility to pursue their investment plans moving forward, with debt-to-equity ratio at 0.39x and financial debt equity ratio at 0.25x.
“Our fifth finish mill in Bulacan plant is underway which is slated to be completed by 2020, increasing our annual cement capacity by 1.5 million metric tons (MMT) to 8.6 MMT.
Ang revealed that there were delays in securing the permits needed to construct the Malabuyoc plant.
“For our intended line for Malabuyoc, Cebu, there were delays in securing permits needed to construct,” said Ang. “The target completion would have to be moved to 2021.”
To recall, Eagle Cement broke ground for its P12.5-billion Cebu plant — with a capacity of 2.0 million metric tons per year — in November 2017 in a bid to increase its annual production capacity to 9.1 million metric tons.
Ang said that the company originally targeted to complete the facility in 2020 and it is aimed to serve the Visayas and Mindanao markets.
“Despite the setback, we are still targeting to sell cement in the Visayas region by end-2020 as promised,” Ang said.
Currently, the Eagle Cement has three production lines located in San Ildefonso, Bulacan and has a combined capacity of 7.1 million metric tons of cement per year serving the Luzon markets.