Fuel price growth will trigger a raise in power tariffs, which is a core element in cost of cement, concrete and aggregates production. “Apart from the direct impact, there is also an indirect impact. Drop of national currency will gear a general growth of prices and of course, inflation,” Rohan explained.
He added that a high exchange rate of the leu will have positive effects for exporters only if the own production is not relying on imports and importers will have to “shrink their activity”.
At the moment, Carpatcement imports an annual cargo of 100,000 tons of cement and 50,000 tons of clinker, following to double imports next year. “We will carry on imports for the following three years at least. The demand will always outrank offer,” general manager of the group had previously stated.
However they will not be the cornerstone in the group’s turnover evolution, as they represent 1% of the own production of 3.5 million tons generated by plants in Bicaz, Deva and Fieni, which will mount, after the 150 million euros investments, to 800,000 tons annual surplus.
Given the production designed to national segment, where cement demand is soaring, a skyrocketing climb of euro against leu will not dent the company’s turnover, according to the general manager.
Cement, aggregate and concrete producer has upgraded budget outlook for this year, posting a moderate growth of incomes, especially affected by shrinking production capacities at the moment, together with lower profits margin, in the context of grim international status on the latest quotations of leu, that generate an average exchange rate superior to initial forecasts.
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