Displaying items by tag: Infrastructure
Cement Association of Canada supports province climate plan
22 August 2016Canada: The Cement Association of Canada has congratulated the province of British Columbia on the release of its Climate Leadership Plan. The plan describes how industry can assist the government in meeting its 2050 targets. The association welcomes the commitment of the provincial government to mandate the use of Portland-limestone cement (PLC) in concrete used in the construction of public infrastructure projects. Using PLC is expected to deliver a 10% reduction in greenhouse gas emissions compared to the use of ordinary Portland cement.
“With today's release of the Climate Leadership Plan, the province of British Columbia has laid out a framework to work collaboratively with individuals, local governments, business and industry in finding ways to address climate change,” said Michael McSweeney, President and CEO of the Cement Association of Canada.
The Great Wall of Donald Trump
20 July 2016Back in the May 2016 issue of Global Cement Magazine we asked key people at the Portland Cement Association how they thought the US presidential election might affect the local cement industry. Wisely, for an advocacy organisation with offices in Washington DC, no one would be drawn, citing a lack of information. At that point it was still unclear who was going to be on the final ticket. However, we all missed a trick because one candidate, Donald Trump, had been talking about building ‘a border fence like you have never seen before’ since at least mid-2014. And that fence could potentially require a lot of cement.
Researchers at market analysts Bernstein’s sent a note to clients last week ahead of the Republican National Convention looking at the implications of if Donald Trump became president of the US and actually set out to build his 40ft high concrete wall between the US and Mexico. The result would be a 2.4Mt boost in demand for cement from cement producers near to the border. In terms of market demand Bernstein concluded that this would add over 1% to cement demand in both 2018 and 2019, a healthy ‘shot in the arm’ to the already pepped-up US cement industry, which is currently growing at around 5%/yr.
Map 1: Map of cement and ready-mix concrete plants near to the US - Mexico border. Source: Bernstein Materials Blast. Note – Bernstein does not show the Capitol Cement plant in San Antonio.
Needless to say, Bernstein’s calculations pile-drive assumptions into assumptions, atop of Trump’s political rhetoric. It bases its calculations on a border wall similar to the Israeli West Bank barrier built out of precast concrete panels. It also tries to model how much concrete and cement would be required depending on the differing height’s Trump has trumpeted at his rallies.
The kicker to this tongue-in-cheek analysis is that the construction company that stands to benefit the most from this infrastructure project is Mexican!
Cemex has significantly more cement plants and ready-mix concrete plants than any other company within a 200-mile zone either side of the border. Looking at integrated cement plants alone, it has six plants in the regions near to the proposed wall from the east and west coasts. Its nearest competitors, CalPortland with four plants and Grupo Cementos de Chihuahua with three plants, are more regionally based in the western US and Chihuahua state in Mexico. Clearly Cemex didn’t rate the chances of Donald Trump’s wall actually happening when it agreed to sell its Odessa cement plant to Grupo Cementos de Chihuahua in May 2016.
All of this goes to show that, wherever you stand on the Donald Trump presidency bid, if you manufacture cement near the US-Mexican border you might be working overtime if he (a) actually becomes president, (b) actually manages to start building his wall and (c) actually decides to make it using cement. Yet before anybody starts popping champagne corks consider this: there might also be unintended consequences for the cement sector. Restricting current legal and illegal migration trends from Mexico to the US might have a greater negative effect on the US cement industry, and the overall economy, than ordering one large infrastructure project. Working that one out is harder than a guesstimate of how much cement a border wall might consume. Probably best not to ask at this stage who might actually pay for the Great Wall of Donald Trump.
Cement production expected to increase in Colombia
21 June 2016Colombia: Cement producers are reacting to a boom in infrastructure projects in Colombia by increasing production and upgrading existing production capacity. Demand for ordinary Portland cement is expected to grow in the short-term due to the government's 4G roads programme and the growth of the housing sector. Current expansion projects in the country include Cementos Argos’ new 1.4Mt/yr plant at Sogamoso in Boyaca and Cemex’s 1Mt/yr cement plant at Maceo in Antioquia.
Cement Manufacturers Association of the Philippines lobbies for government projects to use blended cement
09 May 2016Philippines: The Cement Manufacturers Association of the Philippines (CEMAP) has asked the government to use more blended cement in its infrastructure projects to meet its emissions targets. “In the Philippines, the private sector uses more than 80% of blended cement. The government, on the contrary, does the opposite. It uses 80% Portland cement,” said CEMAP president Ernesto Ordoñez in an interview with local press.
In October 2015 the Philippines submitted to the United Nations its initial commitments to address climate change that included a 70% reduction of carbon emissions by 2030. The reduction is targeted to come from the energy, transport, waste, forestry and industry sectors.
Ratings agency says LafargeHolcim to benefit from Indian infrastructure spending growth
12 April 2016India: Government plans to increase spending on infrastructure projects will benefit LafargeHolcim according to Moody's Investor Service. The second largest cement producer in India will gain from uneven regional demand, with a much larger scale and more prominent operations in northern India, where it sells almost 42% of its local cement volume.
LafargeHolcim and other European cement manufacturers with a presence in India are likely to benefit if the Indian government's plans to ramp up infrastructure spending happen in the next 12 to 18 months. The 2016 Union Budget contained plans to hike public infrastructure spending, especially on roads, which could revive stagnant cement demand in the country.
According to the government's 12th Five Year Plan (2012 - 17) investment in infrastructure should increase from 7.6% of gross domestic product (GDP) in 2014 to 9% in 2017. However, cement demand for government-funded projects has been weak in the last four years with many construction schemes delayed or put on hold. As a result, while infrastructure investment will be a key growth driver, the timing of such investment remains uncertain.
However, Moody’s also noted that European multinational cement producers based in the south of the country with limited geographical spread would be more exposed to local overcapacity in this region. This included HeidelbergCement, Italcementi and CRH.
Norcem signs record contract for 280,000t of cement
08 April 2016Norway: Norcem, the Norwegian subsidiary of HeidelbergCement, and Acciona Ghella JV have signed an agreement for the cement supplies to the Follo Line Project in Oslo. The supply of 280,000t of cement over a three-year period is Norcem’s largest contract ever.
“This is a milestone for HeidelbergCement in Norway and will put great demands on both production and logistics,” said Bernd Scheifele, chairman of the managing board of HeidelbergCement. “Our subsidiary Norcem made the best offer and it has the necessary production capacities and logistics to supply the required volumes to this outstanding project in Norway.” The cement supplies will start in mid to late April 2016.
The Follo Line Project is currently the largest transport project in Norway and includes the country’s longest double track railway tunnel at 20 km. The new railway track runs between Oslo Central Station and the new station in the municipality of Ski in the Follo district, south of Oslo. It will enable a 50% reduction in journey time between Oslo and Ski.The project is scheduled to be finalised at the end of 2021.
Ohorongo Cement supplying cement to build St Helena airport
21 September 2015St Helena/Namibia: Ohorongo Cement has supplied 24,604t of cement towards the construction of the first-ever airport at St Helena island in the South Atlantic Ocean. It will continue to supply cement until the project is finished. The US$419m project is being developed by Basil Read and covers construction of the St Helena Airport and Permanent Wharf. Completion is planned by February 2016, according to local media.
Other projects the Namibian cement producer is supplying include the Husab Mine, Neckertal Dam, Walvis Bay Namport Harbour Project, an acid plant at Tsumeb and construction projects in Zambia and Democratic Republic of the Congo.
The company enjoys infant industry protection awarded by the Namibian government in 2013 for eight years. It recently announced that the Development Bank of Namibia had increased its stake to 11.72%.
India: The Indian government has published a list of 36 companies committed to supplying 9.5Mt of cement in 2015 for road building. The cement will be sold at a price below market rates with a fixed upper limit of US$2.70/bag. The Ministry has decided to build concrete cement roads in place of traditional bitumen roads as it views them as cost-effective and requiring less maintenance.
"After taking consent of the manufacturers we have put the list on a dedicated website, which any company or government agency can access to book their orders. Since the factories are spread all over the country, they can make the best choice. As per the contract, manufacturers can only reduce the price and increase their commitment to supply more cement," said road transport minister Nitin Gadkari. "Once the reduced price is out, it will have effect on other manufacturers and prices across companies may fall," he added.
Pakistan: The inauguration of the Dasu dam has reinforced optimism in the local cement industry, which has been banking on the continuous increase in local demand owing to mega construction projects.
The Dasu dam, one of the mega dam projects, is expected to increase cement demand in Pakistan by 1Mt/yr for the next five years. The 4320MW dam will be completed in two phases at an estimated cost of US$4.8bn. Since the Dasu dam is located in the north, the cement for the project will most likely be procured from nearby cement plants. Cement companies like Maple Leaf, Fecto, Bestway, Cherat, DG Khan, Fauji are the most likely to benefit from the dam construction.
Analysts say the construction of big dams like Dasu and Basha will supplement the already improving cement demand in Pakistan. "Dasu dam will add an additional 1Mt/yr of cement demand, which will be significant for the local industries," said BMA Capital analyst Sajjad Hussain. "It will increase the already escalating cement demand in the country."
"The launch of the Dasu dam is important for the cement industry in northern region of the country," said Standard Capital Securities analyst Saad Hashmi. "Other major infrastructure projects that are expected to start soon will further increase cement demand and it may jump 5% in fiscal year 2015."
Philippines: Cement sales rose by 8.6% in the first quarter of 2014. The surge was largely driven by rebuilding following the destruction wrought by typhoon Haiyan in November 2013, according to the Cement Manufacturers Association of the Philippines (CEMAP). Cement producers sold 5.2Mt of cement in the first quarter of 2014 compared to 4.8Mt in the same period in 2013.
"The increase was primarily due to reconstruction efforts following super-typhoon Haiyan," said CEMAP president Ernesto Ordoñez in a phone interview with local media. He added that rebuilding is likely to drive cement sales for 'more than a year' and that private sector confidence was also helping sales.
Following typhoon Haiyan the government of the Philippines raised its budget for infrastructure in 2014 by 37% to US$9bn from US$6.6bn in 2013 to provide for rehabilitation and reconstruction in areas affected by the typhoon. In 2013 sales by the local cement industry grew by 6% to 19.4Mt/yr from 18.4Mt/yr in 2012.