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Financial News

Jan 2016 Financial News

Confidence cemented - Economic rebound pushes CCCL to invest J$3.6 billion locally

Jan 25, 2016

Buoyed by the recent positive indicators in Jamaica’s economy, Carib Cement Company Limited (CCCL) will be shelling out some US$30 million (approx. J$3.6 billion) to boost its production capacity over the next 15 months.

According to Alejandro Varés, general manager of CCCL, a subsidiary of Trinidad Cement Limited, the money is earmarked for the construction of a new coal mill.

We have plans to increase our cement capacity by 33 per cent in the next 15 to 18 months. We expect our capacity to increase from 1.2 million tonnes per year to 1.6 million tonnes per year. The annual consumption of the market is around 800,000 tonnes,” Varés told The Sunday Gleaner.

“We are preparing for any cement need that Jamaica may have in the future, and we are also considering the possibility of exporting some of this volume while the demand continues to grow,” added Varés.

CCCL, currently the island's sole manufacturer of cement, has long indicated an interest n building a coal plant to slash its production cost as electricity is currently the highest cost to its business and Varés told The Sunday Gleaner this should be a reality soon.

“We are going to build a new coal mill; a 25 tonne per hour coal mill, the rest is going to be distributed along the kiln and the peripherals of the plant.”

According to Varés the planned expansion of the Rockfort east Kingston plant will not affect normal operations there as most of the activities will be carried out during routine shut down hours.

He said the expansion of the facility will result in more jobs for Jamaicans over a 15-month period.

Varés said CCCL customers are among the major stakeholders that will benefit from the increase capacity of the plant as the expansion will put it in a better positions to serve Jamaicans.

“The fact that we are able to increase capacity will allow us to become more competitive, more efficient. In being more efficient we are trying to guarantee price stability.

"So even though some of our costs are in US dollars and there is a depreciation of the dollar, the fact that we are able to produce more will allows us to guarantee the stability for our customers,” said Varés.

He argued that an increase in production by the CCCL means better preparedness for Jamaica and the rest of the region for the hurricane season.

The expansion of the plant comes on the heals of a deal struck between CCCL and Tank Weld Metals that sees the latter exiting the cement importation business and becoming a distributing agency for CCCL.

Tank Weld has been distributing CCCL products from its cement bagging plant at Rio Bueno in Trelawny.

*NOTE: Earlier this story had said nearly half of the US$30 million to be invested by Carib Cement Company Limited over the next 15 months would be used for the construction of a new coal mill. That was incorrect. The company will, in fact, be investing the money in a new more efficient mill that will be an important part of increasing its capacity.


Corey Robinson
Jamaica Gleaner
Sunday January 24, 2016