Complex Made Simple

Saudi Arabia cement output at 64 million tonnes

Current excess supply valued at SAR5.28 billion

Saudi Arabia remains the largest cement producer in the GCC, with a total production capacity of 64 million tonnes after two new factories added four million tonnes to its domestic output.

The Kingdom’s production is higher than domestic demand, but, nevertheless, the option of exporting cement remains closed, at least for now.

Currently, excess supply stands at 22.5m tonnes, while domestic consumption amounts to 57m tonnes, forecast to increase to 60m tonnes.

According to a report by Al Eqtisadiah newspaper, a number of producers reduced their production by ten per cent to cut storage costs. Other producers have shut down production lines.

Industry sources said that the increase in production would result in larger stockpiles as the authorities continue to ban exports.

The current excess supply in the market is valued at SAR5.28 billion, the report indicates.

The sources warned that the rising cement stockpile makes it necessary to open the door for exports since several producers have slashed production by 50 per cent.

(SAR1 = AED0.98, at the time of publishing)