CEMENT

Panama 2017 | INDUSTRY & MINING | B2B

With a construction sector that shows no sign of slowing down, Panama offers a prime market for cement manufactures.

Jorge Azcárraga
JORGE AZCÁRRAGA
General Manager
Cemento Interoceanico
Rosmery Aguirre G.
ROSMERY AGUIRRE G.
General Manager
Centralmix

Can you tell us more about your company's CSR work?

Jorge Azcárraga We have a commitment to the country and in everything we do we want to improve it. As part of this we have gone into social responsibility programs starting with our own workforce. We found we had five or so people who did not know how to read or write and other staff who were living in dwellings without concrete floors. For the first few years of our CSR program we worked to resolve these issues for our own employees alongside a parallel strategy to help the wider community with these educational and housing issues. We want people to know that Cemento Interoceanico seeks to improve their world and the country. We have launched several programs around the area. We have used our products to improve schools, roads, and pavements. Internally we also want to make it an enjoyable place to work. Cement is a dusty product to work with, but our idea is to treat the work environment more like a chocolate factory, so it is as clean and dust-free as possible. We have made a commitment to have dust levels lower than the government standards.

Rosmery Aguirre G. When we develop a new project, we focus on interacting with local communities as much as possible. For example, we hire mainly locally. This allows us to make sure that locals feel like the projects we develop are theirs. We also donate different types of materials, especially recyclable material, to the municipalities where we operate. For example, we donate the material that is not good enough for our high quality projects to local communities so that they can use it in local roads. Finally, we also organize social events in certain communities where we are based on a regular basis. We are currently building new sanitary batteries for the IPT educational center in the community of Chilibre.

In 2014-2015 cement production in Panama dropped by 7.5%. Has this trend changed since?

JA The canal expansion consumed most of that production and in fact there was a cement shortage. From 2H2014 and into 2015 some clinker had to be imported to meet the demand. In 2013 Cemento Interoceanico was in expansion mode because at that time the cement industry was around 2.3 million tons per year in Panama. Our facilities are grinding facilities: we take clinker and grind it to produce cement. During the market turnaround Cemento Interoceanico was able to capture market share at a time when the industry was going down. We have lost about 4-500,000 tons as an industry. So although Cemento Interoceanico has gone up, the cement industry in Panama as a whole has gone down. This means it is now a more competitive market here. Plus, as a company we have had to rapidly reinvent ourselves because we started out with a focus on structural cement to supply all the infrastructure projects that were going on in the country. The demand for ready-mixed cement was high. However, the demand shifted quite quickly and we had to change our business model to focus on more stable products and those targeting sustainability.

RA Our main customer is the state, though we also operate with private companies. For the coming year, we see plenty of opportunities with the government; we participate in large projects and there are other major ones lined up. For example, we bid as suppliers of hot asphalt mixture with Superpave technology for the tenders of the extension to eight lanes of the highway from the Bridge of the Americas to Arraiján, and also we will bid as suppliers for other important projects for the country like the extension of the Panamericana highway from Chorrera to San Carlos. We hope to be a mix provider for whoever wins this project. We still need to further develop our concrete products in order to become even more competitive. We were just focused on covering the basic needs as well as the asphalt mix. At the same time, our approach to the competition is based on investing in new technologies. In the last few years, there have been great developments in the mixtures of asphalt and concrete in a country that was just focused on basic things. The government has been pushing for that. For example, mixing asphalt with certain polymers makes the asphalt more resistant over time and has less impact on the environment.