Exclusive-Egypt’s competition authority approves cement quotas, document says

imageStock Markets15 minutes ago (Jul 06, 2021 06:35AM ET)

(C) Reuters. FILE PHOTO: General view of factories of cement and petroleum by a salt lake at sunset near the port the Mediterranean city of Alexandria, north of Cairo, Egypt December 6, 2020. REUTERS/Amr Abdallah Dalsh

By Patrick Werr

CAIRO (Reuters) -Egypt’s competition authority has approved a request by 23 cement makers to reduce production temporarily to help reduce a glut in output, setting a baseline cut at 10.69%, a document seen by Reuters shows.

The competition authority decision, dated July 5, said there would be additional cuts of 2.81% for each production line and further cuts depending on the company’s age.

The quotas would come into force on July 15 and remain in place for one year, the document said.

Egypt’s cement production capacity has risen significantly in the last three years after the inauguration of the 13 million tonne-per-year plant owned by the military in Beni Suef, even as local sales halved, cement executives say.

The sector is seen as an indicator of Egypt’s openness to foreign investment, which it has struggled to attract.

Companies, including Germany’s HeidelbergCement (DE:HEIG), France’s Vicat, Switzerland’s LafargeHolcim (OTC:HCMLY), Greece’s Titan Cement and Mexico’s CEMEX, invested heavily in Egypt after a privatisation drive that began in the 1990s. Local players set up their own plants later.

Egypt-based executives had welcomed an earlier, draft proposal for production quotas, but two had told Reuters that they thought the formula appeared unfair to foreign companies.

Exclusive-Egypt’s competition authority approves cement quotas, document says

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.