Cambodia will cap cement plants at five

Cambodia is in the middle of a cement capacity expansion programme, but a state official has announced that the country's government will not offer more than the five cement production licences for the plants that will be operational by the end of the year.

The licence cap only applies to production facilities. While companies must obtain production licences from the Ministry of Industry, quarry permits are issued by the Ministry of Mines and Energy, according to Phnom Penh Post.

"We can only provide licences for five companies," said Hort Pheng, director of the Industrial Affairs Department at the Ministry of Industry. "Despite investors coming to ask us for potential locations for cement plants, the ones in Kampot and Battambang are enough as the other provinces lack the quality of limestone needed for cement production."

Two large cement plants are expected to begin operations by the end of the year, according to a Cambodian state official, who said the kingdom has reached its limit for domestic cement production and the government will stop issuing new licences to protect dwindling natural resources.

Chip Mong Insee Cement
Hort Pheng said, Chip Mong Insee – a joint venture between local conglomerate Chip Mong Group and Thailand’s Siam City Cement Corporation (SCCC) – was preparing to open its US$262m cement plant in Kampot province.

Tieng Sopheak Vichea, public and government relations manager at Chip Mong Insee Cement, said the company’s new plant will also have a production capacity of 5000tpd, and is on track for an October opening.

"The cement market is a good opportunity for us," he said. "Even with five factories, prices will remain stable as long as there is continued growth in the construction sector and because this is our first plant we are not worried about a shortage of natural resources."

This will be the country’s fourth cement production facility, with the almost-completed Battambang Conch Cement factory – a joint venture between Cambodian and Chinese investors – slated to be the fifth.

He said the new cement plants will add to the production capacity of the three existing licences held by Kampot Cement, Cambodia Cement Chakrey Ting and Thai Boon Roong – all three located in Kampot province.
 Pheng said the ministry had capped the number of cement production licences despite the high level of investor interest.

Mr Pheng said once all five cement producers are fully operational their combined output should come close to meeting domestic demand for cement, but the booming construction sector would still need to import cement to fill orders and meet project specifications.

Battambang Conch Cement
Heng Sinsiphat, deputy general manager of Battambang Conch Cement, said that while his company’s plant was scheduled to open in December, construction is currently "stuck" and its completion could be delayed. He declined to identify what was hampering construction, but said once finished the plant would be capable of producing 5000tpd of cement.

"We plan to supply the domestic market first before we consider the export market for Vietnam, Laos and Thailand," he said.