Cemex announced that it has opted not to bid on supplying President Donald Trump’s proposed wall between the Mexico-U.S. border, putting profits secondary to a potential political backlash in its home country.
The company isn’t listed on the U.S. General Services Administration’s Federal Opportunities website of potential suppliers to the planned border wall, according to Bloomberg Intelligence. Jorge Perez, a spokesman for the company, confirmed the company didn’t participate in the process.
Mexico’s biggest cement maker has plants on both sides of the border, and its potential to be one of the biggest beneficiaries of the border wall was seen by analysts as an ironic outcome of Trump’s attempt to shut out undocumented Mexican immigrants.
Some estimates peg the cost of the wall at $15 billion or more. Trump’s budget proposal seeks $1.5 billion for 2017 and $2.6 billion for 2018 to build the wall, with more spending later, according to Michael Mulvaney, director of the Office of Management and Budget.
Even if Cemex doesn’t supply materials for the wall, it could still benefit from a boost in general demand for cement, which would help all suppliers indirectly, according to analysts. Cemex sees cement demand growing 4 percent and 6 percent on public works such as the FAST Act, Trump’s $1 trillion infrastructure plan and the potential wall, according to a recent presentation by U.S. division President Ignacio Madridejos to investors in New York.
Meanwhile French Foreign Minister Jean-Marc Ayrault said LafargeHolcim should think twice about supplying cement for the wall after LafargeHolcim’s chief executive Eric Olsen said he was prepared to supply the materials for it.
“We are prepared to supply our materials to all types of infrastructure projects in the United States,” Olsen said. “We are the leader in cement, so we supply all our customers,” he said. “We are here to support the building and development of the United States.”
French President Francois Hollande also urged caution when asked about LafargeHolcim’s readiness to supply the wall project.
“I think there are markets where one must be cautious before declaring one’s candidacy,” Hollande told a news conference in Brussels, Belgium.
“We are not a political organization,” Olsen said.