Riyadh – Mubasher: AlJazira Capital expected that the cost per the ton of the exported cement in KSA would increase to SAR 280-340 (including shipping cost and operating expenses), which limit potential export markets and profitability.
In the first quarter of 2016, Saudi government announce the regulations for cement exports, which states that companies will pay back the subsidy on fuel, and the cost will be between SAR 85-133/exported ton, the report said.
The research firm expected that cement dispatches will remain muted in 2017, due to the back of tight liquidity position and the government’s effort to prioritize its’ project pipeline to improve its efficiency, despite the improvement in the budget spending.
“We expect the sector to show signs of recovery over 2018 and into 2019 along with improvement in crude oil prices. Furthermore, lower sales prices are consistent with continued pressure on cement demand,” AlJazira Capital stated.
