Apr 2011 Financial News

First shipment of Carib cement goes to Dom Rep

Apr 15, 2011

Caribbean Cement Company Limited (CCC), in a move to expand to markets in the region, has shipped its first batch of 2,500 tons of cement to the Dominican Republic and later signed an agreement to set up warehouse space and a distribution and packaging unit in Haiti to take advantage of the rebuilding of the country following the January 2010 earthquake in that nation.

It is seeking to consolidate its position in Haiti to which it had already been exporting cement since 2008.

Anthony Haynes, CCC general manager, said the company's foray into the Dominican Republic market was being made in a context where the search for new markets outside of Jamaica became more urgent with the completion, in August 2009, of the US$170 million Rockfort, Kingston plant upgrading and modernisation project, which boosted CCC's capacity to a million tons of cement.

The shipment was sent off from the Rockfort pier on Monday.

Haynes said the Dominican Republic, which has the capacity to absorb three million tons of cement annually, is considered to be among the most lucrative in the region and Caribbean Cement's intention is to gain 10 per cent of that market. This would result in a 78 per cent improvement in total exports for the cement manufacturer, which exported 192,500 ton last year, doubling the amount shipped in 2009.

Haynes, in an interview on Wednesday, said the addition of the Dominican Republic was crucial in Caribbean Cement Company's quest to increase its presence in the region.

The country, he told Financial Gleaner, has been a target market for CCC given the "very attractive prices and only two shipping days away from Jamaica."

"We can see ourselves easily putting in 100,000 tons into Dom Rep per year for a start," said Haynes, adding, "I think very soon we should be doing eight to 10,000 tons per month. This market is the real game-changer."

The company started exports after a one-year certification process by the Dominican Republic's standards agency General Management Standards and Quality Systems.

CCC has no plans for infrastructure build out in the Dominican Republic at this time, but has partnered with Docemca, a local company, to sell its products.

"We sell FOB (freight on board), so the risk passes to them. They own the ships and have the logistical capabilities in Dominican Republic and also in Haiti," said the general manager.

According to Haynes, "We have established our brand throughout the market. We are now looking for markets where we feel that we can have a significant quantity of cement going into a destination."

Caribbean Cement has not yet penetrated the Venezuelan and Colombian markets, but it has moved to establish partnerships in those countries, said Haynes.

"Haiti is a very volatile market, but we have a very good understanding of that country, and it is part of a long-term strategic goal," the general manager said.

"That goal can change if the donor countries that promised some US$16 billion in aid following the earthquake (in January 2010) do not provide the money, but we intend to be there."


Source:
mark.titus@gleanerjm.com
Jamaica Gleaner
Friday April 15, 2011

http://jamaica-gleaner.com/gleaner/20110415/business/business2.html