Sri Lanka’s cement market was up 1.5% YOY to 1,653 KMT by the end of Q1 2018, indicating a slow recovery in the construction sector. The growth mainly came from the industrial customer segment while other segments were stagnant. Cement supply to Sri Lankan domestic market is heavily dependent on import of clinker and of bulk cement. Therefore, Supply Chain Management plays a vital role in the Sri Lankan Cement industry.
Thusith Gunawarnasuriya, Director of Procurement and Logistics at Siam City Cement (Lanka) said “We are focusing on lean and agile supply chain practices at INSEE to meet the dynamic market demands. One key project was commissioning Sri Lanka’s first cement bag palletizer at the Ruhunu Cement Plant. This enabled INSEE to respond faster to market demand fluctuations through buffer stock management, improve truck fleet utilization, reduce customer waiting time, lower bag breakages in handling and improve health and safety of the cement bag handlers. Taking this best practice further, INSEE will soon commission a second palletizer at its fully integrated cement plant in Puttalam.
With the addition of Galle Cement Works, the new cement grinding plant in Galle port, the company will further strengthen its supply capacity to the Sri Lankan market. The new Galle cement plant will lead to increased demand for imported clinker. Hence the company recently carried out a trial ship to ship transfer operation at the Hambantota port which concluded successfully. In the ship to ship transfer model, larger vessels of 50,000 Ton to 55,000 Ton bulk cargo vessels arrive at Trincomalee and Hambantota ports and then the cargo is transferred to smaller vessels for the coastal voyage to the Galle port, which can handle a maximum of 10,000 Ton to 11,000 Ton vessels due to draft limitations. Through this we overcome the constraints at the Galle port for handling larger vessels and berth availability. Thus, in addition to the current operations at Galle, the Trincomalee, Colombo and Hambantota ports too will become an INSEE logistics hub. Further it is planned to carry out the bulk cargo vessel discharging through a material unloading conveyor to improve operational efficiencies in Galle port” he said.
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With the enhanced supply capability to the local market, the INSEE supply chain team realizes that it is equally important to build capability and expand capacity for cement distribution to take these additional volumes to the market. “We will be expanding our warehouse and logistics footprint to improve product availability in the key markets we serve. This means that we can reach out to more customers and reach them faster” said Thusith. Accordingly, INSEE Cement is working on adding several regional warehouses to complement the existing cement dispatch warehouse network in Colombo, Kurunegala and Trincomalee. ICT and digital technologies are a major driver in the robust supply chain roadmap established by the team and multiple initiatives are being pursued for supply chain optimization, improving customer connectivity, fleet management and visual performance management.
The parent company, Siam City Cement Public Company Limited (SCCC) has adapted and progressed to serve the construction needs of the region; its cement manufacturing facility in Saraburi, Thailand, is the world’s largest cement production complex. The company, SCCC draws from the accumulated expertise and knowledge over decades of operation, and is strongly focused on investing in rapidly advancing regional markets such as Sri Lanka, which show much promise in sustainable construction.
