31 December 2012

Nigeria: Lafarge Reduces Production As Cement Glut Intensifies

Lagos — The Management of Lafarge Cement WAPCO Plc has reduced its production capacity as glut intensifies in the subsector.

Plant Manager, Lafarge's Ewekoro cement plant, Mr. Lanre Opakunle, said that at the moment, 50 percent of Lafarge's Shagamu plant has been shut down and the factory running at 50 percent less than what it normally does.

He also said that the company's Ewekoro plant had cut down production by 40 percent in response to the distress in the market.

He said that at the moment, the various Lafarge factories have excess cement and clicker inventory at their plants of about 300,000 metric tonnes, which cannot be absorbed by the Nigerian market because it is already over supplied.

He said they have been running the Ewekoro plant on skeletal schedule to prevent the total shut down of any part of the plant.

He said the factory was running out of space where excess clinker can be deposited.

"We do not have space in our strategic storage facility for more than 20,000 tonnes of clinker, which is only the output of four days production and if things still do not change in the market, the factory may be forced to either scale down its production or shut down its production lines.

"All you need to do is to look at our 80,000 tonnes per hour cement parking facility from where trailers load cement to the market, you can see that the 10 units each of 80,000 tonnes per hour parkers are totally deserted. It is about 2.00 pm now and only 180 tonnes of cement have been loaded off, normally by this time not less than 1,400 tonnes would have been loaded off," he said.

Opakunle also showed journalists bulk cement haulage trucks that had since been laden with cement in anticipation that prospective buyers would come along and order them, but are still in the Lafarge plant's trailer park because the buyers are just not coming along to ask for cement.

It would be recalled that the management of Dangote Cement Plc had recently temporarily closed down its four million metric tonnes per annum capacity Gboko Plant as a result of glut in the cement market.

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