Eurocement Cutting Back as Prices Plummet

Eurocement, the country's largest cement maker, said Tuesday that it was cutting back production and manpower at most of its factories as prices are set to fall another 10 percent by the end of November.

Cement prices in the country dropped 23 percent during the summer months after import tariffs were lifted and suppliers from Turkey and China began flooding the market. Slackening demand is also pushing down prices.

Eurocement, by far the biggest local cement producer with a market share of some 35 percent, is being forced to slash production and shorten working days at most factories, a spokeswoman for the unlisted company said.

"In particular, our brick-firing kilns have been completely shut down, most of them," she said, declining to be identified.

The company's investment program is also being reconsidered, with some resources shifted away from cement and bricks toward other products, she said.

Austrian construction giant Strabag, in which billionaire Oleg Deripaska owns a 30 percent stake, said Monday that it was postponing plans to develop its cement business in Russia because of recent price drops.

French cement major Lafarge is building several new plants in Russia at a total cost of up to 1 billion euros ($1.43 billion).

Cement prices are dropping from record highs that were reached earlier this year.

In the 18 months to June, the price of cement on the Russian market doubled to $215 per ton, becoming the highest in the world.