Holcim bets on diversification while awaiting construction sector recovery

Holcim Argentina is pushing forward with a new investment in Córdoba, launching its first plant for concrete additives despite the ongoing slump in the construction sector. The move represents a significant diversification strategy for the company.

The new facility, named ADI, required an investment exceeding US$1.2 million. It is designed to produce additives internally, a component Holcim previously purchased from third parties. With an annual capacity of over seven million liters, the automated plant will enhance the performance of concrete and optimize construction processes.

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What we are looking for is to accompany the entire cycle of the work, not just be a supplier of cement, but to offer integral solutions for construction.

Pablo Bittar, CEO of Holcim Argentina, explained that the company aims to support the entire construction lifecycle, moving beyond being just a cement supplier to offering integral solutions. Producing additives in-house is expected to improve cost efficiency, boost productivity, and complement Holcim's existing portfolio, which includes cement, concrete, aggregates, and precast products.

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We see an evolution of the Argentine market at two speeds, with sectors with higher growth that spill part of this improvement into the construction sector, but not as much as we would like.

This strategic investment comes at a difficult time for Argentina's construction industry, which has seen a 25% drop in cement consumption in 2024. Bittar noted that while some economic sectors are showing growth, the construction industry's recovery is slow, hindered by a lack of credit and consumer incentives. He anticipates a modest 3% improvement by June, but on a very low base.

Despite these challenges, Holcim maintains a long-term perspective on the Argentine market. Bittar emphasized the company's commitment to innovation, even in tough economic conditions. This strategy aligns with Holcim's broader shift since 2023 to transform from a traditional cement manufacturer into a comprehensive provider of construction solutions, expanding through acquisitions and organic growth in various related sectors. The company has invested approximately US$300 million in Argentina, signaling confidence in the market's potential.

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We have to navigate different economic scenarios and position ourselves as an innovative company even in challenging contexts.