Displaying items by tag: Export
Update on Turkey: November 2020
18 November 2020Last week’s financial results from Çimsa contained a glimmer of hope for the Turkish cement market. Its net sales grew by 27% year-on-year to Euro175m in the first nine months of 2020 and operating profit more than doubled. Crucially, the balance between domestic and export sales tilted back a little toward the local market at a 55/45 ratio rather than 40/60 for the same period in 2019. Oyak Cement, another of the larger local producers, reported a similar rise in sales also. Akçansa Çimento, the joint venture between Sabancı Holding and HeidelbergCement, saw its sales fall slightly so far in 2020 but its profit grew. These financial results are all surprising given the currency and debt crisis the country faced in 2018 and now coronavirus in 2020.
Graph 1: Domestic and export cement sales in Turkey, January – July 2017 – 2020. Source: Turkish Cement Manufacturers’ Association (TÇMB)
Graph 1 above shows the general picture of the Turkish cement industry for the first seven months of each year to put the data so far in 2020 into context. The general Turkish economy faced problems in the middle of the year when the value of the Turkish Lira dropped sharply in mid-2018 and interest rates rose sharply. Subsequently, annual cement sales fell by over 20% year-on-year to 56.5Mt in 2019. A couple of weeks ago the Turkish Cement Manufacturers’ Association (TÇMB) said that the sector started 2020 optimistically with a recovery in January 2020. Coronavirus then hit, causing a contraction in the domestic market for the next four months. However, the construction market picked up again in June 2020 and this is expected to have continued into August 2020.
The cement sector previously pivoted to exports strongly with nearly a 50% bump up in exports to 11Mt in 2019. 2020 has been similar so far for the export market with a 40% rise year-on-year from January to July 2020 to around 9Mt. Much of these exports have gone to the US with local media and the Turkish Statistical Institute (TurkStat) reporting that the North American country took 18% of Turkey’s Euro840m cement exports from January to September 2020. Focusing on international trade has not come without a price though. In September 2020 the Ukrainian government started an investigation into alleged dumping of cement by Turkish producers. Following a complaint by local producers, the Interdepartmental Commission for International Trade (ICIT) determined that: “imports were made to an extent and under conditions such that they may cause material injury to the domestic producer.” The results of the investigation remain to be seen, but Ukraine had no qualms in 2019 about slapping tariffs onto cement imports from Russia, Belarus and Moldova.
All of this leaves the Turkish cement producers relying, much as previously, on the export market to hold up sales while the domestic market recovers to 2018 levels. This is becoming riskier, given the growing number of rivals exporting cement around the world, particularly from around the Mediterranean, and with more countries like Egypt hoping to do likewise. Yet as long as favourite destinations like the US and Israel keep buying, Turkey should be okay. At home, the question remains whether the growth seen post-coronavirus measures in the spring is a sign of economic recovery or merely pent up demand. The country’s initial coronavirus response was praised internationally but signs of a second wave are present. Meanwhile the International Monetary Fund (IMF) confirmed in October 2020 its earlier forecast of a 5% drop in gross domestic product (GDP) for Turkey in 2020. Much of the rest of the world is facing similar contractions in output or worse in 2020 but starting the year from a poor economic position is not enviable.
Iranian cement production grows by 14% to 36Mt in first half of year
18 November 2020Iran: Cement production rose by 14.4% year-on-year to 35.6Mt in the first half of the local calendar year that started in March 2020 from 31.1Mt in the same period in the previous year. The sector exported 5.8Mt of cement with a value of US$128m to 28 countries according to the Mehr News Agency. India, Afghanistan, Russia, Iraq, Qatar, Kenya, Kuwait, Sri Lanka, Pakistan, Armenia, Turkmenistan, Kazakhstan, Azerbaijan, Bangladesh, China and Oman were among the export destinations of cement.
Bolivia promotes cement exports to Paraguay
18 November 2020Bolivia/Paraguay: The Bolivian-Paraguayan Binational Chamber of Commerce & Industry is working with Bolivia-based Fábrica Nacional de Cemento (Fancesa) to export cement to Paraguay via the Parana – Paraguay Rivers Inland Waterway. The organisation is also trying to promote exports from the new Empresa Publica Productiva Cementos de Bolivia’s (ECEBOL) integrated cement plant at Caracollo in Oruro, according to the Agencia Boliviana de Información. Local Bolivian cement producers faced production stoppages from March to May 2020 due to coronavirus-related restrictions.
Exports continue to drive Çimsa’s sales so far in 2020
11 November 2020Turkey: Çimsa’s net sales grew by 27% year-on-year to Euro175m in the first nine months of 2020. Its operating profit more than doubled to Euro37.1m. Local sales grew faster than export sales in the reporting period but export revenue remains greater than domestic revenue. Chief executive officer (CEO) Umut Zenar reflected this when he praised the company’s strong export performance despite the challenges posed by coronavirus.
Dangote Cement and Bua Cement given permission to export cement by land from Nigeria
11 November 2020Nigeria: Dangote Cement and Bua Cement have been allowed to export goods by land following a closure of land borders in mid 2019 due to smuggling. The government has granted permission for Dangote Cement to export its products to Niger and Togo, according to the Business Live newspaper. Bua Group has also received approval. However, Lafarge Africa has reportedly not yet received permission.
Uzbekistan: Cement companies produced 7.8Mt of cement in the first nine months of 2020, a rise of 2.6% year-on-year from the same period in 2019. The Trend News Agency reports that the country exported US$24.2m-worth of cement in the period, to Afghanistan, Singapore, Russia, China and Turkey. The value of its cement imports – from Kazakhstan, Tajikistan, the Kyrgyz Republic, Iran and Russia – exceeded this by more than double at US$870m.
Dangote Cement increases nine-month sales by 12% to US$2bn
09 November 2020Nigeria: Dangote Cement has reported group sales of US$2.00bn in the first nine months of 2020, up by 12% year-on-year from US$1.79bn in the first nine months of 2019. Its cement volumes rose by 7% to 19.2Mt from 18.0Mt, while its earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 17% to US$934m from US$797m.
Chief executive officer (CEO) Michel Puchercos said, “Dangote Cement’s strategy to offer high quality products at competitive prices is meeting customers' expectations in Nigeria and across the continent, where we continue to deploy excellent marketing initiatives and operational excellence. We remain committed to protecting our staff and communities by being fully compliant with health and safety measures in all our territories of operation. We are focused on adapting to the rapidly evolving markets in which we operate.”
The group said, “By 2021, all our countries of operation are estimated to return to growth, and we are well positioned to capture the demand eventually driven by this economic growth. We have seen a strong recovery across our operations in the third quarter of 2020, which is our strongest third quarter to date.” It added, “Our vision is for West and Central Africa to become cement and clinker independent, with Nigeria being the main export hub. This will notably contribute to the improvement of regional trade within the Economic Community of West African States (ECOWAS) region and beyond with the African Continental Free Trade Area (AfCFTA).”
Pakistan dispatches record monthly cement volumes in September 2020
05 November 2020Pakistan: Cement producers dispatched a record 5.74Mt in October 2020. Exports rose by 12% to 875,000t from 784,000t. The Nation newspaper has reported that the figure brings Pakistan’s total dispatches for the first four months of the 2021 financial year, from 1 July 2020 to 31 October 2020, to 19.3Mt, up by 20% from 16.1Mt in the first four months of the 2020 financial year.
The All Pakistan Cement Manufacturers Association said that cement consumption may increase further if the government rationalises duties and taxes and withdraws excise duty.
Lucky Cement praises government for ending lockdown on exports
04 November 2020Pakistan: Lucky Cement chief executive officer (CEO) Muhammed Ali Tabba has praised the government’s decision to lift coronavirus lockdown restrictions on the export of products. As a result, he predicted that the rate of export growth would increase in 2020. The Balochistan Times newspaper has reported that Tabba also welcomed the end of restrictions on construction, and thanked the State Bank of Pakistan for subsidising payrolls during the on-going national coronavirus lockdown and the Ministry of Finance for releasing business refunds quickly.
Tabba said, “The country has benefited greatly from the way the Pakistan Tehreek-e-Insaf (PTI) government has won the war against a pandemic like Covid-19.”
GICA to export of 40,000t of clinker to Dominican Republic
30 October 2020Algeria: The Ain El Kebira (SCAEK) cement plant near Setif, part of the Industrial Cement Group of Algeria (GICA), has launched an operation to export 40,000t of clinker to the Dominican Republic. The company has already been marketed its products in Senegal, Ivory Coast, Guinea, Peru and Brazil, according to the Algeria Press Service. SCAEK has already exported 0.55Mt of clinker to countries in Africa and South America. The cement producer plans to export 0.75Mt of clinker in 2020.