Anhui Conch, Asia Cement link up as pressures rise

Anhui Conch Cement, Asia's largest cement producer, yesterday signed a strategic partnership agreement with Taiwan's Asia Cement to explore overseas markets and share expertise in eco-friendly technologies as the industry begins to feel the bite of Beijing's anti-pollution drive.

Cement prices on the mainland have been rising since September last year, when the central authorities stepped up efforts to close some of the most heavily polluting cement factories even as demand began to pick up with rapid investment in the infrastructure and property sectors.

The State Council said in October it planned to cut 100 million tonnes of outdated cement capacity by the end of next year, driving up the stocks of industry leaders such as Anhui Conch, as investors bet the move would strengthen the bigger players.

"If we find any target that suits our strategies, we will actively seek acquisition opportunities," said Guo Wensan, the chairman of Anhui Conch. "Globally, our priority [of investment] is Southeast Asia."

The firm, which has a domestic capacity of more than 200 million tonnes, is eyeing 10 million tonnes of combined capacity in Vietnam, Indonesia and Myanmar in the next three to five years.

"We don't have much global experience and will learn from Asia Cement," Guo said at a news briefing after the signing ceremony, referring to the latter's global sales networks in other Asian regions as well as America, Africa and the Middle East.