Displaying items by tag: Algeria
Tunisia: The Ministry of Industry and Small and Medium-Sized Enterprises has issued a decree authorising the use of polypropylene cement bags, with the aim of increasing the competitiveness of Tunisian cement against rival Turkish products on the Libyan market. The Economiste Maghrebin newspaper has reported that the loss of a valuable exporter market following Algeria’s attainment of a cement surplus led the ministry to enact the cost-cutting policy. In January 2020, Algeria enacted a progressive prohibition on this type of packaging with a view to a blanket ban from 1 January 2021.
Minister of Industry and Small and Medium-Sized Enterprises Salah Ben Youssef says that his department “submitted a report on the impacts of the use of polypropylene packaging for cement to the Ministry of the Environment in May 2020 and received no reply,” but implemented the initiative because it was the only viable alternative to kraft bags, which he says are “overpriced due to monopolies in raw materials and assembly.” Ben Youssef said that polypropylene bags, which are permitted for use in food, lime, animal feed and fertilisers packaging, are “both recyclable and reusable,” and would enable the Tunisian cement industry to become self-sufficient in serving its bagging needs. As a further cost-cutting measure, Ben Youssef proposed that the government establish a solar power plant in order to reduce cement companies’ total energy bills by US$5.13m/yr.
The 16Mt/yr-capacity Tunisian cement sector, which includes international companies such as Carthage Cement and Brazil-based Votorantim Cimentos subsidiary La Cimenterie de Jbel Oust, produced 11Mt of cement in 2019 against a domestic demand of 7.0Mt.
LafargeHolcim reports return to normality as lockdowns end, despite punishing first half
30 July 2020Switzerland: LafargeHolcim says that net sales in each of its five regions ‘returned to prior-year levels by the end of June 2020’ following the easing of coronavirus-related lockdowns. Its net sales fell by 10.8% year-on-year to Euro9.95bn in the first half of 2020 on a like-for-like basis due to the ‘severe’ impact of the lockdowns on construction sites in several of its main operating countries. It also blamed negative currency effects for an additional fall in sales. Its recurring earnings before interest and taxation (EBIT) dropped by 22% to Euro1.11bn. Its net debt decreased by 15.8% to Euro9.91bn from Euro11.8bn. Cement sales volumes fell by 13.1% to 87.2Mt, aggregates by 6% to 114Mt and ready-mix concrete (RMC) by 18.6% to 19.2Mm3.
Group chief executive officer Jan Jenisch said, “Our half-year results demonstrate the great resilience of our business. I’m encouraged by our team’s agility to weather the storm with the rapid execution of our ‘Health, Cost & Cash’ action plan, effectively driving cost savings ahead of expectations, improving net working capital and delivering record free cash flow.” He added, “The peak of the crisis is behind us. We expect a solid second half of the year based on June’s full recovery, the trend of our order book and upcoming government stimulus packages.”
By region the group noted the most severe coronavirus-related disruption in Asia-Pacific despite China delivering a full recovery and growing sales volumes by the end of the second quarter. In Europe lockdowns in the UK and France had a particular impact and it said that, “volumes suggest a V-shaped recovery in June 2020 for the majority of markets, except in the UK.” Significant impacts were noted in Ecuador, Colombia and El Salvador in Latin America. Sales volumes declined in Algeria, Egypt, Iraq and South Africa in the group’s Middle East Africa region but Nigeria delivered a ‘resilient’ performance. Finally, North America was the groups best performing region with slight dips in cement and aggregate sales volumes but a rise in RMX and rising recurring EBIT. This was attributed to, “fast and effective cost management in the US.”
Aïn Touta Cement awarded ISO certifications
27 May 2020Algeria: The Aïn Touta Cement (SCIMAT) plant near Batna has been awarded two conformity certificates, according to the Ministry of Industry and Mining. The subsidiary of Public Industrial Cement Group of Algeria (GICA) has earned ISO 45001: 2018, relating to the occupational health and safety management system, and ISO 50001: 2018, related to energy management.
Successful test run of new kiln at Entreprise des Ciments et Dérivés d'El Chellif plant
11 March 2020Algeria: Fives has reported that it has installed and produced a batch of clinker with a new 6000t/day FCB kiln line at Entreprise des Ciments et Dérivés d'El Chellif (ECDE)’s integrated 1.0Mt/yr Chlef cement plant. When commissioned, the line will bring the plant’s capacity to 3.2Mt/yr.
Algeria: Public Industrial Cement Group of Algeria (GICA) subsidiary Beni Saf has announced a target of 45,000t in 2020 of clinker exported to Africa. Algérie Presse Service has reported that the recipient countries include those in the sub-Saharan region.
Algeria’s 11-month cement exports climb by 240% year-on-year
13 January 2020Algeria: Algeria sold cement and clinker worth US$59.3m in the first 11 months of 2019 – up by from US$17.5m in the corresponding period ending 30 November 2018. The country’s 40Mt/yr-capacity cement industry serves a domestic demand of 22Mt/yr. Algeria Press Service has reported that Algeria’s key trade partners for exported cement were sub-Saharan African nations, according to former Minister for Trade Saïd Djellab.
Algeria targets emerging markets for booming cement exports
09 December 2019Algeria: Algeria’s estimated value of exported cement in 2019 is US$60m, up by 200% from US$20m in 2018. Algerian Trade Minister Saïd Djellab noted increases to grinding capacity in Guinea Bissau, Senegal, Gabon and Mali as a potential source of revenue from clinker exports, according to L’Expression. “Algeria can meet the needs of these markets and become their leading supplier of clinker in 2020.” The minister estimated that the total value of cement and clinker exports ‘will reach US$400m by 2021.’
Algerian cement exports expected to reach US$400m by 2021
20 November 2019Algeria: Trade Minister Said Djellab has revealed that the country’s cement exports are expected to reach a value of US$400m by 2021. Export earnings were around US$20m in 2018 and then tripled to US$60m in 2019, according to the El Mujahid newspaper. The minister made the comments at a ceremony marking an export of cement from a Ciment Lafarge Souakri (CILAS) plant. He added that the local market has a cement production capacity of 40Mt/yr and that only 22Mt/yr is required domestically. Producers are targeting countries in west Africa, including Guinea Bissau, Senegal, Gabon and Mali.
Algeria: Groupe des Ciments d’Algérie’s (GICA) Aïn el Kebira cement plant in Setif has been certified by the American Petroleum Institute (API) to produce oil well cement products. It has been award two certificates following a one-year audit, according to the El Moudjahid newspaper. Djamila Tamazirt, Minister of Industry and Mining, who was on a tour of the unit, said that the development would help the country to stop importing oil well cements. The country imports an estimated 0.2Mt/yr of oil well cement at a cost of nearly US$30m.
Update on Algeria
24 July 2019Two new stories from Algeria this week highlight a changing industry. Firstly, Groupe Industriel des Ciments d’Algérie (GICA) started marketing cement from its new Sigus integrated plant. The unit was commissioned earlier in the year. Secondly, clinker export figures for the sector show 10-fold growth year-on-year to a value of US$30m for the first five months of 2019.
Graph 1: Cement production and capacity in Algeria, 2012 - 2018. Source: Algerian National Office of Statistics, United States Geological Survey, Global Cement Directory 2013 - 2019. Estimates supplied for 2017 and 2018.
Graph 1 above depicts the moment that lots of new production capacity started to be ordered and then commissioned in 2017. The Global Cement Directory lists new plant projects as they are announced so the trend from 2016 to 2017 may not be as pronounced as it seems but the general destination remains the same. A Ministry of Industry and Mining report estimated that production capacity would reach 40Mt/yr in 2020. Consumption was reported at 26Mt in 2016.
To cope with this the cement industry in Algeria has been moving towards an export model over the last few years. Industry and government figures started to warn of an end to imports in 2016. This quickly flipped to prognostications of production overcapacity in 2017. This then became a stream of news stories about export operations from the local industries to places like West Africa. One consequence of this were problems for foreign exporters in Tunisia and Spain, for example, as the Algerian market was shut off. Indeed, it must have been satisfying for state-producer and market leader GICA to announce that it was exporting cement to Europe in 2018!
Notably the local market has no cement grinding plants, yet this too has started to change. In May 2019 Algematco Steel ordered a modular Ready2Grind MVR vertical roller mill from Germany’s Gebr. Pfeiffer. Target markets for the exports identified by the Ministry of Industry and Mining included neighbouring Mali, Libya, Mauritania and Niger. However, only two of these countries are accessible by sea. Unfortunately, Libya’s resurgence in violence since April 2019 is unlikely to help the export market. The other countries share land borders with Algeria but no rail links. An overland export operation to Niger from a plant near Adrar was reported in early 2019 but feasibility on a large scale seems unlikely given the distances involved.
LafargeHolcim said in its 2018 financial report that its net sales were down in its Middle East and African region due to price pressure and lower volumes in oversupplied markets, particularly in Algeria, Iraq and Jordan. Bloomberg reported in February 2019 that LafargeHolcim was considering divesting assets in the region. However, LafargeHolcim’s exit from Southeast Asia may have since bought it some financial breathing room.
With Algeria facing a production capacity gap of at least 10Mt/yr it seems likely that foreign-backed producers like LafargeHolcim will suffer despite potential in the local economy. Nationally, the race is on to see if the industry can bring its cement to the sea and find new export markets.