UAE cement prices between Dh210 and Dh220

Cement prices in the UAE have reached a stable average rate between Dh210 and Dh220 per tonne, according to an industry survey.

Meanwhile, prices of a 50kg bag range from Dh11 to Dh13, though one manufacturer told Emirates Business that some companies are selling for as low as Dh10.

In January, this paper had reported that cement prices would increase from February 1 following a decision by the UAE Cement Manufacturers Association.

A senior industry official had then said the association recently decided to fix the price in different emirates. In Abu Dhabi, which is less affected by the slowdown in the construction sector, cement will be priced at Dh250 per tonne, whereas in Dubai it will be sold at Dh240 per tonne, he said. In the Northern Emirates, where most of the factories are located, cement will be priced at Dh220 per tonne.

Union Cement Norcem Company said it is selling bulk cement at Dh220 per tonne, while it charges Dh12 for a 50kg bag. The company's production varies from 5,000 to 10,000 tonnes of cement and 15,000 to 20,000 tonnes of clinker cement daily, with an annual clinker production capacity of 4.5 million metric tonnes and cement production capacity of 4.8 million metric tonnes. It is now negotiating export trade with other countries, particularly GCC states.

"We are talking with many clients from Sudan, Kuwait, Bahrain and so on. However, one has to be able to produce regularly," said M Mustafa Gorgunel, General Manager of Union Cement Norcem.

Proximity to a port has the advantage of reducing logistic cargo fees. "Instead of shutting down one's plant, it is better to export some of the volume at a loss to improve productivity, cut costs and strive to break even for some profit," he said.

Meanwhile, Emirates Cement Company is following the same route and selling at Dh220 per tonne, and at Dh11.25 per bag. Antoine Duclaux, CEO of Emirates Cement, said the company is looking forward to increasing its cement price to a fair figure of Dh260 per tonne.

However, prices are not exactly uniform, according to R Chaudhary, General Manager of Jebel Ali Cement, who said some companies sell their products at low prices to offload excess.

He said: "Unfortunately, there are companies, especially newcomers that entered the market during its peak, who are selling at increased volumes with reduced prices of less than Dh10 per 50kg."

The company has a potential capacity of 0.8 million mt/annum though current production hovers around 0.4-0.5 million mt/annum.

Chaudhary said: "Some companies of the Cement Manufacturers Association are also not following their strict commitment and sell below the listed price. They are supposed to fulfill their commitment, prices should be at Dh12.5, but they are selling at lower prices."

The company is selling within the range of Dh210 to Dh220 per tonne, but not below Dh210 per tonne, he said. It is also looking at exports apart from its existing Oman market and eyeing Qatar. "We are in talks with Qatar and to expand strategically in that country," he said.

Salah Soliman, Marketing and Sales Manager at National Cement Company, said his firm is selling at Dh12 per 50kg bag and is also looking at exports in the coming year. "If there are any suitable export orders matching my selling prices, I would not hesitate to export,"he said.

The company has an annual production capacity of more than 1.5 million tonnes, and is producing 3,500 to 4,000 tonnes of clinker cement and 5,500 to 6,000 tonnes of cement daily.

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