A NEW cement player is set to enter the local market in the first quarter of 2018, aiming to take advantage of an estimated supply shortfall over the next five years amid a construction boom in the country.
Big Boss Cement, Inc., chaired by Henry Sy Jr.—son of the country’s richest man—was launched on Thursday. Sy Jr.’s investment in Big Boss, however, is in his personal capacity and not under the SM Group.
The company will use readily available raw materials such as lahar, which requires less heat to process so that its plants will emit less carbon dioxide.
In a news briefing in Makati City, Big Boss President Gilbert Cruz said the first plant, located in Porac, Pampanga, is already 90 percent finished and will commence production in March. It will be capable of producing 5,000 bags or 1.5 million tons of cement a month.
“We have a small plant that can produce 5,000 bags in the heart of the city and then our plants will start producing in March for commercial purposes. That is 1.5 million bags a month,” Cruz said.
Big Boss Cement will sell its cement products at an average price of P206 per bag. The company expects to generate P3.6 billion in revenues in one year for the first production line alone.
Cruz noted government projections that by 2022, demand for cement will rise to 40 million tons from about 25 million tons this year.
“What’s happening right now is that there is an artificial oversupply because of the importations. But if you go down to the bottom of it, there’s still a huge demand due to the lack of cement and we believe that we should be able to help the country fill this demand instead of relying on imports,” he said.
The company will put up two more plants in the next six months. The second line will start construction beside the first plant as the company has acquired additional properties in the area. The location of the third one was not identified.
Cruz said building one plant is estimated to cost P2 billion.
“From today, we would need another 18 months [for the second plant to start production.]That’s the worst case scenario. It could be earlier,” he said.