Unplanned cement capacity expansion: Dawn

By Engineer Hussain Ahmad Siddiqui

CURRENTLY, cement is a 2.50 billion tons global business and its consumption is expected to increase to 3.13 billion tons by 2015. Many countries are engaged in expanding their production capacities in a big way and large-size greenfield cement plants are being installed.

World’s largest plant in Missouri (US) with a capacity of 12,000 tons of clinker per day, or four million tons of cement annually, is to be commissioned in third quarter of 2009.

Following the international trend, the Pakistan Board of Investment (BoI) is promoting investments in large-size cement plants, of the capacity of 10,000 ton per day, a greenfield project costing around $234 million. Whether or not it is viable under local conditions, major producers are moving ahead without proactive planning.

Large-scale capacity expansion is being undertaken by many cement companies to capitalise on projections of high cement demand, particularly in the export markets. Fauji Cement Co Ltd has announced construction of a new plant of 7,200 tons of clinker per day to go on stream by early 2010. This will increase Fauji Cement’s annual installed capacity about three times--from existing 1.165 million to 3.27 million tons.

Lucky Cement has emerged as the largest cement producer, with an installed capacity of 6.55 million tons per annum, by adding two plants of 8,400 ton per day capacity each.
DG Khan Cement, second largest, has 4.21 million tons annual capacity. A company, which operates a 10,000 ton per day cement plant, is implementing another expansion plan. This will enhance its total installed capacity in the range of 6.32 to 7.99 million tons annually by 2010.

Over the last four years, cement industry has witnessed remarkable expansion, from 16.93 million tons per annum in 2003-04 to 37.16 million tons in 2007-08. By the year 2010, the total annual cement capacity is planned to be around 51 million tons. Per capita annual consumption of cement is 131 kg, in comparison to world average of 273 kg. Thus, there appears to be promising potential for increased consumption in future, justifying the planned large capacity expansion.

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