More cement firms to close

At least six cement plants and over 15 cement manufacturing lines in major cement companies have closed in the wake of rising cement imports from Taiwan, Japan and Indonesia, Philippine Cement Manufacturers Corp. (Philcemcor) said.

Philcemcor president Magdaleno B. Albarracin Jr. said the imports – now rising to an alarming 18 percent of the total market – have already cost local manufacturers P3.6 billion in lost sales from June 1999 to August 2000, resulting in nearly 4,000 direct jobs in cement plants and their allied businesses.

Of the Philippine cement industry’s 43 production lines, only 20 are operating, Albarracin said. "Of those in operation, many are running less than 42-percent capacity," he added. "More are liable to close down because they are losing their market to dumped imports from Taiwan, Japan and Indonesia and more jobs will be lost in the coming months as more plants stop operating," he noted.

"We all want to avoid having to cut jobs especially in these difficult times but many of our manufacturers need to take drastic belt-tightening measures to keep our heads above water," the Philcemcor president said.

Philcemcor general manager Lupo Feliciano said a survey of major cement companies showed that 21 lines have already been shut down, including the plants that have been closed, due to the surge of imported cement. Job losses in companies were in a range of between 14 percent and 100 percent of total work force, he said.

Market leader Union Cement Corp. has closed six lines, including lines located in Davao, La Union and its only kiln operating in Central Luzon. Antipolo-based Solid Cement has shut down two of its three lines of production. Rizal Cement in Binangonan has been completely shut-down since cement imports have surged in 1999.

Republic Cement had shut down two lines operating at 425 tons per day last year and a further line with a capacity of 1,100 tons per day in September 2000. Fortune Cement closed its 2,500-ton/day plant last August while operations at Mindanao Portland Cement are currently suspended. In all, nearly 6,000 tons per day of capacity has been suspended by the Blue Circle Alliance, with over 250 job losses.

FR Cement Corp., Continental Operations Corp., Lloyd’s Richfield and Titan Cement – which was shut down – closed a total of 5,500-ton-per-day capacity, costing 756 jobs or a total of 45.6 percent of total jobs in the four companies.

Alsons Cement has not closed any line but has been exporting at very low prices just to keep its plant running and its people employed but Philcemcor said the company is not sure how long it can keep this up without resorting to line closures.

Albarracin said the capital-intensive nature of cement investment certifies the commitment of local companies and assures the establishment of sound economic foundations in terms of job creation, technology transfer, and the inevitable drive to be world competitive.

"Ironically, it takes only $5 to 10 million to set up an import terminal while a cement plant with a one million metric ton annual capacity costs about $150 million to put up and takes two to three years to build," Feliciano said.

"The industry needs an immediate reprieve from the onslaught of dumped cement and unfair imports," Albarracin said. "Without that we cannot survive, sustain jobs and produce world-competitive products for our consumers."