WhyQatar-topBanner (728x90px)
e - Magazine
LeftSideBar Add 1

LeftSideBar Add 2

LeftSideBar Add 3

LeftSideBar Add 4

For Qatari residents: Do you prefer a summer or winter World Cup 2022?

Qatar's construction sector cements its position

Written by  Author |   Thu, 08 May 2014 06:06

Cement, concrete and stone are three of the raw materials accounting for a large proportion of the production cost in Qatar or in the construction industry in general and anywhere. Hence, the demand for these materials closely follows the movement of the construction industry. And Qatar is no exception. Yet, following the international trend, and as the construction industry in Qatar matures, this also meant compliance with green building methods.

Between late 2008 and 2010, construction projects were being put on hold due to the global economic crisis, and as a result the cement, concrete and stone industries were badly hit in Qatar as was the case everywhere around the region. However, after winning the FIFA World Cup bid and as projects resumed in 2011 and 2012 whatever momentum they previously lost and construction market demand recovered gradually, turnover increased and the top lines of most companies in the industry improved. Cement prices in Qatar are usually stable owing to government controls over prices and it is expected to remain stable at current levels.

Analysts estimate that growing demand for cement in preparation for massive construction towards the World Cup 2022 is likely to far outpace the supply even though Qatari manufacturers have recently increased capacity to meet this increased demand. It is believed that they may have to import from Saudi Arabia and the UAE in 2014 and 2015. On the back of strong economic fundamentals, Qatar's construction sector will trigger demand for cement, with a forecast CAGR of 12% to 2015, according to a commercial bank capital report.

Increasing cement production
Qatar's production capacity was estimated around at 6.2Mt/yr in 2013, which meets the country's existing demand. However, as consumption is expected to peak up in 2014 and 2015, Qatari companies would be unlikely to be able to match the impending demand, meaning that it will have to seek cement imports.

Cement producers in Qatar are planning to further expand their capacity in preparation for anticipated massive investment in the country's construction sector. The majority of construction activities will be in relation to infrastructure upgrade and real estate developments. The Qatar National Cement Company (QNCC), already the country's largest cement producer with a market share of around 70%, is going to add 0.93Mt/yr to take its capacity to 5.36Mt/yr in the coming years.

Nevertheless, to increase Qatar's production capacity, Qatar National Cement Company (QNCC) recently signed a letter of intent with a French company. The contract was signed for the construction of QNCC's Cement Plant Line 5. By signing the letter of intent, Fives FCB, the contractor and consultant TPF Basse Sambre will work jointly to finalize the contract documents. The contract price on turnkey basis is equivalent to QR950m ($261 million). The production capacity is 5,000 TPD clinker.

The construction will start after handing over the site in a phased manner, starting with two cement mills which will be delivered in 17 months and 19 months; and the overall project will be completed in 27 months. With the completion of Plant Line 5, QNCC 's production capacity is expected to jump to 17,000 tons of clinker per day and the grinding capacity will jump to 20,000 tons of cement per day.

On the other hand, Danish engineering firm FLSmidth has confirmed reports in the Qatari media that it has entered into an agreement with Qatari Investors Group to supply equipment and machinery for a cement plant in Qatar. According to media reports, Qatari Investors Group has entered into an agreement with FLSmidth and the CNBM International for a $190 million expansion of its subsidiary, Al Khaliji Cement. The cement plant's second line will double its clinker production capacity to 12,000t/day and its cement production capacity will rise to 14,000t/day.

Concrete follows the same pattern
By definition, Concrete is a building material made from a mixture of water, aggregates (small rocks, grit or gravel ) and sand, which is held together by cement added to act as a binder and may also include admixtures. Concrete is liquid in its original state but needs to be used within two hours of its production. It is poured into formwork and left to set for anywhere between 4 to 24 hours and can be produced both at the building site or a concrete plant. Concrete mixing is a complex task which varies depending on the need of the project, the building codes prevailing in the region, the choice of cement and other raw materials used, the weather conditions and the required design strength due to which there exist more than five hundred different formulae for concrete. The concrete that is mixed with a set recipe at a batching plant and subsequently delivered to the work site through truck mounted transit mixers is referred to as ready-mix concrete. There is also a third variety of concrete which due to its relatively lower cost and ease of use is gaining ground in the GCC markets which is precast concrete.

Precast concrete is produced by casting concrete in reusable molds or forms and later cured in a controlled environment to be transported to the construction site for installation as against standard concrete which is poured into site-specific forms and cured on site. The final product is finely distinguished from precast stone by using a fine aggregate in the mixture to resemble the naturally occurring rock or stone.

The GCC economies account for over 40 percent of the Middle East concrete market of which 30% constitutes premixed concrete which is used in most constructions with similar patterns or basic designs. With the gradual revival of construction across the GCC countries in the past few years, especially in key markets such as Qatar, prices of concrete have begun to rise steeply and as capacities in the cement industry rose by around 13 percent, competition heated up among the regional players.

Read 16302 times

Leave a Comment

Make sure you enter the (*) required information where indicated. HTML code is not allowed.

WhyQatar Magazine is an environmentally conscious publication
October / 10 / 2014
WhyQatar-Right Left Ad (247x244px)
WhyQatar-Right Squared (116x116px)
WhyQatar-Right Squared 2
WhyQatar-Right Squared Bottom (116x116px)
WhyQatar-Right Rectangle (116x380px)



RightSideBar_345x175 Add 1
RightSideBar_345x175 Add 2
RightSideBar_345x175 Add 3
RightSideBar_345x175 Add 4