Saudi cement dispatches down 15% YoY in April

The cement dispatches have declined 1.4 percent month-on-month (MoM), and 14.5 percent year-on-year (YoY) for April 2017 to 4.64 million tons, due to continued weak demand, Aljazira Capital said in a report.

“We foresee the downtrend to continue for the upcoming months, given the weak fundamentals of the sector and the impact of seasonality,” the brokerage added.

On MoM basis, Al Safwa Cement showed the highest increase of 26.3 percent MoM, followed by Al Jouf Cement with an increase of 9.6 percent MoM.

On the other hand, Hail Cement and City Cement were the worst performers, registering declines of 10.9 percent MoM and 9.9 percent MoM respectively.

On YoY basis, Al Safwa and City Cement were the only companies to record a growth of 8.2 percent YoY and 6.8 percent respectively, whereas Northern Cement and Al Jouf Cement witnessed a fall of 44.9 percent YoY and 38.7 percent YoY respectively.

Clinker inventory reached 28.47 million tons by end of April, with a drop of 1.4 percent MoM, but increasing 36.1 percent YoY.

Al Safwa Cement’s clinker inventory showed the highest increase of 9.5 percent MoM, followed by Southern Cement which showed an increase of 6.1 percent MoM. On the other hand, Umm Al-Qura and Yamama cement companies’ clinker inventory fell 22.3 percent MoM and 6.6 percent MoM respectively.

On the market share level, Al Safwa Cement increased market share from 3.4 percent in April 2016 to 4.2 percent in April-2017. Moreover, City Cement increased its market share from 6.0 percent to 7.4 percent.

On the other hand, Northern Cement market share tumbled to 2.5 percent in April-2017, versus 3.8 percent in April-2016, followed by Al Jouf cement as it slumped from 3.8 percent in April 2016 to 2.7 percent in April 2017.

Inventory levels dropped by 1.8 percent MoM for the first time since June 2016.