The closure of many outdated cement factories springing up across the country should be a priority to make way for the building of an efficient industry, Malcolm Shelbourne, chief executive of INTERCEM, said Wednesday.

"A modern and well-structured cement industry is required for prosperity and growth," Shelbourne told yesterday's International Cement Technology Conference.

The two-day gathering, co-sponsored by INTERCEM and China National Materials Industry Group Corp, is bringing together more than 600 delegates to discuss the world's cement industry, foreign investment in China and factors affecting China's cement market.

Shelbourne expressed his hopes that China would construct more new plants employing the latest technology, both in terms of production output and environment protection.

His words were echoed by Jiang Minglin, deputy director and adviser of the Counselor Office under the State Council, who stated: "This acute issue involving blind investment on cement projects must be solved as soon as possible."

Cement produced by using outmoded means, such as vertical shaft kiln production units, accounted for 75 per cent of China's total cement output in 2003.

"In some areas, even more new outdated kilns are being launched and some old kilns are being enlarged to produce more cement," he said.

"The practice has led to a serious imbalance in China's cement industry, one which will adversely influence the country's fast economic growth."

Huang Shuhe, vice-minister of the State-owned Assets Supervision and Administration Commission, said the country had taken measures to bring the overheated investment on cement projects under control.

As of 2003, fixed-investment projects worth a combined 16,000 billion yuan (US$1,937 billion) were under construction.

This investment continued to increase in the first three months of this year, with 68,000 projects costing 2,400 billion yuan (US$290 billion) launched.

"The overheated investment will create a potential crisis for the country's cement industry while stimulating its development," said Huang.

But, he added, the Chinese Government had recognized these "unhealthy and unsteady factors caused by blind investment and redundant construction."

The consequences will result in a shortage of raw materials, market saturation, deficient energy supply and pressure on transport.

"Outmoded production methods also consume a large amount of valuable limestone resources and pollute the environment," said Jiang.

Lei Qianzhi, president of the China Cement Association, said the country would make every effort to push forward the new dry process in cement production. About 130 million tons of cement will be produced with new technology next year, accounting for 20 per cent of its total cement output.

A number of 4,000-ton plants will be launched in the developed regions to produce more cement with the new dry process, said Lei .

More than 150 new dry process production lines are expected to be put into operation this year to increase annual production capacity to 200 million tons.

(China Daily September 9, 2004)