Cement manufacturers continue to answer the market's loud demand for more of their product. Eagle Materials is the latest supplier to announce plans to ramp up capacity and production. The only bad news is that the production increases won't affect supplies much this year or next. Eagle's expansion won't be operational until 2008.
On the positive side, the Eagle plants planned for expansion and modernization are located in areas where cement shortfalls have been chronic—Wyoming and Nevada. The expansion will increase capacity at the Mountain Cement facility, located in Laramie, Wyo., by 60 percent, and double output at the Nevada Cement plant, located in Fernley, Nev., giving the plants the ability to produce 1.1 million tons each.
“For that region, I think that will make a significant difference,” says NAHB economist Michael Carliner. “But this year still will be tough.”
Another reason that the plant expansion locations are of note is that they particularly affect areas that aren't import-friendly. “We don't expect [shortages there] will be solved as easily by imports,” says Carliner.
The projects, combined with a previously announced expansion at the company's LaSalle, Ill., plant, represent a 50 percent increase in its overall production capacity, increasing from 2.65 million tons to 4 million tons per year. The Illinois expansion project is said to be ahead of schedule, with completion now set for December.