Cement companies invest US$ 3.45 billion
Valor Econômico - 07/21/2008
Taken by surprise by an abrupt and unexpected growth in consumption, the Brazilian cement industry is initiating a new cycle of billionaire investments that will increase the productive capacity of the country in more than 35% in the next three to four years and consolidate Brazil as one of the ten largest producers of the world. The funds for the expansion or setting up of new plants announced so far by the main companies of the sector are already above R$ 5.5 billion (US$ 3.45 billion) and it is expected that these amounts grow in the next months due to new allocation of funds that may be defined. With the investments that are underway, Brazil may get to 2012 with a productive capacity superior to 80 million tons. Nowadays, if all Brazilian plants produced in the limit they would be able to place 60 million tons in the market every year. The expectation of the sector is that the consumption leaves behind the historical threshold of 40 million, reached in 1999, to more than 60 million tons in 2011. The increase of the demand is being pushed up, at this moment, by the strong expansion of the real estate sector as a whole. Besides, the lower interest rates and the growth in income have also heated what the market calls informal construction, small residential works made or managed independently by individuals. At the same time, the infrastructure works have been fueled up by the Federal Government's Growth Acceleration Program (PAC, in Portuguese). Bridges, roads, dams and a countless number of small constructions are also demanding the sector. In addition, of course, to the industrial works that also grew unexpectedly, pushing the demand of the cement companies up, as a result of the sped up economic expansion of the two last years. With the expectation that consumption should grow 12% this year compared to an expansion of 10% of 2007, the companies have decided to invest so as to prevent that the difference between a stagnated productive capacity and an extremely heated demand becomes a real problem.