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Qatar’s domestic cement demand is projected to grow double within the next three years, driven by heavy government infrastructure spending
The Dubai-based financial services firm Arqaam Capital in its report on Qatar’s cement sector released recently noted the country’s cement demand dynamics is heavily driven by government infrastructure spend, The Pensinsula reported.
Qatar’s domestic construction expenditure, which equated to 6.5 per cent of GDP in 2013, is expected touch 6.9 per cent of real GDP in 2014.
The report added that Qatar is expected to open up to US$50bn construction projects in 2014, up 15 per cent compared to the year 2013. The move follows the state’s plan to invest US$208bn on infrastructure developments in 2013-2018, largely linked to the 2022 World Cup event.
Accordingly, Arqaam Capital expects Qatar’s cement demand growth to accelerate, delivering 9.4mn tonnes per annum in consumption by FY17.
“We expect production capacity and demand levels to reach equilibrium by FY18. Our forecasts are on the conservative side as Qatar’s Ministry of Development and Planning’s most recently published survey suggests demand for limestone is set to increase by 131 per cent in 2014 and 127 per cent in 2015, with demand for washed sand growing by 108 per cent in 2014 and 106 per cent in 2015,” the report said.
It added that Qatar National Cement Company (QNCD) remains Qatar’s largest cement producer with a production capacity of 4.4mn tonnes per annum of cement, which is 62 per cent of the market share.