CEMENT group Blue Circle, which employs 180 workers at its Weardale plant, has revealed a recovery in its markets despite announcing 350 job losses a fortnight ago.

The company said cement demand in the first five months of the year was ahead of last year in almost all of its markets.

The group said it was seeing a recovery in its markets in Malaysia and Chile with demand up by 31 per cent and 17 per cent respectively, and it expected the recovery seen in Asia to continue.

Although the group announced no immediate redundancies at their Eastgate plant in Weardale, they revealed that a three month efficiency drive at the site had been initiated.

Union leaders said members were deeply shocked by the announcement of national job losses, but last night they were more upbeat about the site's future.

Derek Cattell, regional organiser for the GMB said: "Any good news for Blue Circle would appear to be good news for our members at the Weardale site.

"There appears to be no dark clouds on the horizon at Eastgate, and we are hopeful the site can survive and prosper."

The decision for an efficiency drive at their Weardale plant came a month after Blue Circle narrowly saw off a hostile £3.65bn takeover bid from French rival Lafarge which had sparked fears among its staff at the cement works.

The company confirmed as many as 350 redundancies would be sought nationwide over two years, with the firm hoping most would come voluntarily and from staff taking early retirement. The announcement came as part of a review of operations across its eight UK works and head office.

A five-person team of middle managers from the Eastgate works are still searching for efficiency improvements with Blue Circle spokesman Alistair Gale saying the team were looking at all areas, from energy saving to productivity improvements.

"The review is about how to improve the performance of the facility, it's not about jobs," he added.

The Eastgate works pours at least £8m a year into the area, and is vital to the fragile local economy.

Chief executive of Blue Circle, Rick Haythornthwaite, said yesterday the group had no further job cuts planned in the UK.

"Our performance in the year to date is encouraging, with a particularly strong recovery in Asia," he said

Mr Haythornthwaite had successfully won round shareholders to back Blue Circle's management in May against its three-month long takeover battle with Lafarge.

Blue Circle's defence had included convincing investors the long-term prospects of its business should be valued higher than Lafarge's bid - especially the Asian element of the business.