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Saudi plans to cut cement production on fading demand

Xinhua, January 18, 2017 Adjust font size:

A number of Saudi cement companies plan to cut production by 5-10 percent this year to deal with reduction in demands, Al Sharq Al Awsat local newspaper reported on Wednesday.

The decision was made after remarkable decline in 2016 cement selling profits by around 17 percent, to ensure that all the cement products will be sold in 2017.

The decline was attributed to low local demands for cement and high competition with the existence of 15 companies, as well as increase in the production cost as result of the increase in the energy prices.

Those companies predicted to sell around 60 million tons, of 5 million tons every month.

The drop in the demands started from the middle of 2015 with the reduction of oil prices in the international market.

Saudi Arabia cut subsidies on commodities and increase the oil prices for companies and individuals last year to cope with the decline of its revenues because of the dropping oil prices in international markets. Endit