Lafarge North America Inc. announced that, due to significant continuing cost challenges, the company will raise cement prices in the United States by $15 per ton. The increase will take effect January 1, 2009.
The company said that 2007 and the first three quarters of 2008 saw increased operating and energy costs, and this, when combined with a sharp decline in construction activity, has made for a very challenging environment in the North American market. While prices of competing building materials have increased, Lafarge North America’s cement pricing has generally remained flat since 2007.
"At Lafarge, we have taken significant measures to control costs by investing to improve efficiency and right-sizing our workforce in order to mitigate the impact for our customers," said Sylvain Garnaud, president of Cement, Lafarge North America Inc. "While these initiatives have had very positive results, we decided further action was necessary to manage unprecedented input cost increases."
Lafarge North America cited the increased costs of coal, electricity, and diesel as the main drivers behind the company’s soaring energy costs.
Over the past 12-18 months, Lafarge North America noted that the company has reduced costs by reducing overhead, seeking alternative fuel sources, right-sizing its workforce, and reducing operations at certain cement plants and facilities. Additionally, the company has focused on high-efficiency, low-cost, environmentally optimized operations and has invested in information technology to improve customer service and operating efficiency.