Salehi Nour El-Din, Chairman and CEO of “Fondal” confirmed that the public establishment contributes to the progress of the national economy by reducing the import bill for steel products to meet the needs of the national market, adding that the Fondal’s share of the national market is estimated at 25 to 30% of needs. Noting in the same context, that this market share could rise to 40% by 2025.
Regarding the current conditions related to the Covid-19 health crisis, which has lasted more than a year and disrupted the supply chain, Salehi affirmed that the company’s cash flow has been hit hard, noting that “Fondal “Like many other institutions, it cannot be effective in a stagnant environment.
In this meeting devoted to the magazine “Al-Hiwar”, Salehi considered that the ideal for Fondal is to obtain a partnership (public-private) with the aim of attracting private rather than public capital.
The steel sector plays an important role in improving the economic indicators of our country How does "Fondal" contribute to the progress of the national economy?
“Fondal” has three handling units, with other terminology that manufactures iron parts according to the demand of its customers, which is characterized by diversification, which contributes significantly to reducing the import bill of foundry products , with attention to the needs of the national market, and the most important sectors of the “Fondal” customer market are: the cement sector where grinding balls and spare parts for industrial cement equipment are manufactured, the mechanical sector with major customers such as: GERMAN CONSTANTINE- SOMABE El- Harrach-SNVI, the steel sector (sider El-Hadjar), the agricultural machinery sector (CMA BELABBES), the public works sector. Mining and quarrying sector, roads and decoration sector, hydraulic sector, technical plumbing and other sectors.
The share of “Fondal” in the national market is estimated at 25 to 30% of national needs.
From this point of view, in Algeria this market share could reach 40% by 2025.
The steel industry requires significant financial investments. How is "Fondal" doing in the current economic conditions?
The current conditions linked to the COVID-19 health crisis, which lasted more than a year, have disrupted the supply chain, as well as with regard to revenues and outputs, the acquisition of raw materials and the sale of products.
The health crisis has a very significant impact on the company’s cash flow because it has been hit hard, Fondal, like many other institutions, cannot be effective in a recessive environment.
Fondal manufactures products for many sectors, including the road construction sector
The sectors you have just mentioned constitute an activity for Fondal, among other activities, we have a unit dedicated to this area for the road and corridor sector, which is the plumbing unit in El Harrach, Route 3/5 Baraki-El Harrach.
The order book is full and the capacities of this unit are not expandable due to the real estate container on which the factory is located, since it cannot meet all customer needs.
Actual investments made at the unit level, which have seen a significant improvement in product quality.
These last two units are also capable of serving the production of the road sector, but the issue is a question of profitability and competence.
Does Fondal diversify its products on the market to face the competition?
Product diversification depends on customer needs.
In some markets, Fondal has a monopoly, such as the refractory steel, manganese steel market, where customers automatically go to Fondal units, unlike other markets, there is some competition which began to take hold with the entry of several private sector foundries.
Vondal’s anti-competitive strategy is based on the policy of proximity to customers to monitor the operation of our products and help them to use them better.
What's new in the partnerships, are there any internal or external agreements?
The ideal, for the company Fondal, is to obtain a partnership (public-private) in order to attract private capital rather than the public sector.
Has the pandemic affected your business number?
Our revenue has gone down because orders from our customers have gone down, and it makes sense that our product sales are down as well.
Who are your loyal customers?
We have private customers and we also have loyal customers from public electricity and gas companies, for example, the company “Cosidar”, Naftal, Algeria Telecom.. The company “Cosidar” was in the process of completing a project of construction and the project has stopped, and this leads to a drop in the acquisition of our sales, and the financial crisis has affected us a lot.
Do you have agreements from outside the country?
Currently we don’t have agreements with overseas, but in the future we will work to export our products overseas.
We have held several meetings with the brother country of Libya, with Mali and Niger, and God willing, we will continue to market our products. .
We have quality, solid, durable products, and this is the secret of our success.
Where do you get the raw material in the manufacture of your products?
The raw material we bring from individuals and public companies, and now we have decided to buy a preservative for the ovens, because this material is strong and clean without increasing carbon dioxide, because the ovens with which we work are sensitive, and when we put the motors inside, we don’t know what harmful substances may be there.
In this case, explosions or holes can occur in the oven, and we will lose a lot of money to restore it, and this is what makes us stop working for days and these days affect us, knowing that if we don’t work in a day, we can lose a million Algerian dinars, so we decided to buy This guard is for protection.
What are Vondal's future plans?
The pioneer project of the Fondal company is to build a new foundry in the region of Oran, the current foundry is located in an urban site not compatible with the environment.
This plumbing could in the future produce a wide range of products for several market segments.
Future capacities are at least: 2700 tons of cast iron of different grades 1000 tons of steel of different grades and differences 300 tons of non-ferrous metals.
The Council of State Contributions had already allocated a financial envelope of 4,000 billion for this project, however, it is still conditional on the granting of a real estate container estimated at 6 hectares and an additional financial envelope of no less of 6000 md.
We have many future projects, including a project that we are going to embody with a branch of Sonatrach, and we have a client, as well as we are going to conclude agreements with him, as well as we have agreements with Algérie Télécom and Sonelgaz, as I mentioned before.
We also hope to carve out the lion’s share from the port of Cherchell, and it’s no secret that our Balouauna leads in quality.
We also hope that the state will help us to reduce the import of goods from abroad, because when we import Chinese products at the price of 100 dinars, our price is estimated at 180 dinars, which affects our sales negatively, knowing that our quality varies greatly in durability, for example, when the car goes through the sewer, it breaks directly, like the products from Spain and China, because the raw materials made from it are very low.