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Saudi cement firms to cut output by 12% - newspaper
20 March 2017
Cement companies in Saudi Arabia intend to cut production by about 12 per cent following a sharp fall in sales due to lower demand, a local newspaper said on Monday.
Some of the 17 cement factories are also planning to reduce their workforce to avert losses, Arabic daily Al-Jazirah said quoting Jihad Al-Rasheed, Chairman of the National Cement Committee of the Council of Saudi Chambers.
"There are plans by the cement companies in the Kingdom to lower production by nearly 12 per cent…the local cement market is currently suffering from a glut and this has forced the companies to revise their production operations," he said.
Figures shared by him showed that the total cement output by the 17 firms dipped by nearly 25 per cent to 4.09 million tonnes in February 2017 compared to 5.44 million tonnes in the corresponding period in 2016.
He said local cement sales are expected to shrink by 12-20 per cent this year compared to 2016 in the absence of new major infrastructure projects, adding that there were no signs of recovery in demand due to low demand and high supply.
Though the authorities partially lifted a long-standing ban on cement exports in late 2016, most factories were discouraged by tough export terms.
Cement production in Saudi Arabia, the world's largest oil exporter, had steadily grown over the past decade before it declined to about 55.9 million tonnes in 2016 from over 60 million tonnes in 2015, according to Al-Jazirah.
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