ASEAN countries may face cement shortages

ASEAN countries may face cement shortages

KUALA LUMPUR (AFP): A Malaysian minister has warned of a cement shortage in ASEAN countries as planned construction projects exceed the region's existing capacity, reports said yesterday.

Minister of Domestic Trade and Consumer Affairs Abu Hassan Omar said Malaysia and the other members of the Association of Southeast Asian Nations (ASEAN) were likely to experience a cement shortage as early as this year.

ASEAN also includes Singapore, Indonesia, Thailand, Brunei and the Philippines.

Abu Hassan contrasted the booming region's estimated demand of 86 million tons this year with its total grinding capacity of 83 million tons.

In Malaysia, demand for cement was expected to grow by 14 percent this year to 11.4 million tons, he said.

"Since the industry is capital-intensive and the return to capital investment is relatively low in the short term, there is the need for the producers to work together to increase efficiency and supply," Abu Hassan was Tuesday reported saying in local news reports.

He said his ministry was willing to discuss business incentives for raising production but ruled out a price increase because of its effect on inflation.

The Cement and Concrete Association of Malaysia has asked for a price hike to cover higher transportation and raw material costs.

Malaysia currently has six cement plants and four grinding plants. Four new cement plants are being built while three are being expanded.