Displaying items by tag: Switzerland
Building new buildings from old ones
19 April 2023Holcim launched its formal take on construction and demolition waste (CDW) this week with the unveiling of its ECOCycle technology platform at the BAU architecture fair in Munich. This amounts to managing the distribution, processing, grinding and recycling of CDW back into new building material products. It claims that its concrete, cement and aggregate products can contain 10 - 100% of CDW with no drop in performance.
It is hard to gauge whether this is marketing for existing operations or the start of something new. Yet, in its 2022 Sustainability Report, Holcim said that it recycled 6.8Mt of CDW back into building products and that it is on track to meet its target of 10Mt by 2025. This target was neatly put into words as wanting “to build more new buildings from old ones.” Ahead of the announcement of the launch of ECOCycle, it added that it was going to roll out its Susteno product around Europe. This product, made from 20% CDW, was originally released in Switzerland in the late 2010s. Notably, recent acquisitions by Holcim that connect to its growing focus on CDW include Poland-based Ol-Trans in July 2022, UK-based Wiltshire Heavy Building Materials in October 2022 and UK-based Sivyer Logistics in April 2023.
As covered by Global Cement Weekly in February 2023, Holcim is not the only heavy building materials company pivoting to CDW. The European Union (EU) set a 70% recovery target for it in 2020 and various cement company sustainability reports have described the region as being receptive to moves into this sector. Cemex set up a global waste management subsidiary called Regenera at the end of January 2023. This division covers both alternative fuels, CDW and industrial by-products, so it is more general than Holcim’s current effort, but it shows intent in the same direction. Cemex previously set a target of recycling 14Mt/yr CDW by 2030.
Heidelberg Materials has been working on developing recycled concrete paste and its ReConcrete-360° concrete recycling process. As of its last sustainability report, this process had been tested at the pilot scale and is now being developed and scaled for industrial application. In addition to acquiring UK-based Mick George Group in December 2022 Heidelberg Materials has also purchased Germany-based RWG Holding in January 2023 and Germany-based SER Group in February 2023. All three companies operate in the CDW sector.
The other notable contribution that Heidelberg Materials has been making is as a partner of the ‘Circular City - Building Material Registry for the City of Heidelberg’ project. When Heidelberg Materials announced its involvement in the initiative in mid-2022 it said it was the first city in Europe to apply the principles of urban mining. The goal of the project is to take an inventory of the city’s buildings and then compile it in a digital material registry. The basis for the registry is the Urban Mining Screener developed by EPEA (Environmental Protection Encouragement Agency). This programme can estimate the composition of buildings based on building data such as location, year of construction, building volume or building type. Circular economy supply chains can then act accordingly when a building is retrofitted, demolished or deconstructed. So, for example, at the start of the project it worked out that a former US Army housing estate conversion site was calculated to contain approximately 466,000t of material, with about half in the form of concrete, a fifth in the form of bricks and 5% as metal.
That last example compares to a European Commission estimate that, as a whole, Europe generates around 450 - 500Mt/yr of CDW. A third of this is concrete. As with alternative fuels and slag previously, this may be money going into the ground. Recycling building materials is not new but any significant increase in reusing CDW that can reduce the clinker factor of cement (and the cement factor of concrete) offers a potentially cheaper route to building materials decarbonisation than carbon capture and utilisation/storage at current costs. Hence the continued interest.
Switzerland: Holcim has launched ECOCycle, its initiative to recycle construction demolition materials into new building products. It says it can recycle construction demolition materials across a broad range of applications, from decarbonised raw materials in low-carbon cement formulation, to aggregates in concrete and fillers in road construction.
Jan Jenisch, the chief executive officer of Holcim, said “Across all metropolitan areas where we operate, we are at the forefront of driving circular construction to build new from the old. With our ECOCycle technology we can build cities from cities, recycling 100% of construction demolition materials into new solutions, so everything gets reused and nothing gets lost. With our world’s growing population and urbanisation, circular construction is essential to build a future that works for people and the planet.”
The building materials producer is deploying its ECOCycle technology across its range of products to scale up circular construction. It says that its process enables concrete, cement and aggregates to contain from 10 - 100% recycled construction and demolition waste with no change in performance. The initiative is supported by distributing, processing, grinding and recycling construction and demolition materials into new building material products.
ECOCycle brings together previous work Holcim has conducted in the field such as launching a cement in Switzerland made with 20% demolition and construction waste. The company is now launching this product elsewhere in Europe. In France it is building an affordable housing complex using 100% ECOCycle recycled concrete. In the UK it is building a residential area with 50% ECOCycle aggregates that have been made from 100% recycled construction demolition materials.
Russia/Uzbekistan: The US Department of State has imposed sanctions upon USM Holding including its subsidiaries Akkermann Cement and USM Cement in Russia, and Akhangarancement in Uzbekistan. The action is intended to target company owner Alisher Burhanovich Usmanov and his various business interests. Other USM companies in the iron, steel, copper, gold, telecommunications and real estate sectors are also affected.
The US Department of the Treasury’s Office of Foreign Assets Control noted that Usmanov was, “one of Russia’s wealthiest billionaires, with vast holdings across multiple sectors of the Russian Federation economy as well as internationally.” It added that he was linked to multiple senior Russian officials, including Russian President Vladimir Putin as well as Dmitry Medvedev, current Deputy Chairman of the Security Council of Russia and former President and Prime Minister of Russia. Usmanov has also been sanctioned by Australia, Canada, the European Union (EU), Japan, New Zealand, Switzerland and the UK.
These latest US sanctions are in response to the Russian invasion of Ukraine in February 2022. Companies on the sanction list are forbidden to conduct business transactions with any US citizens.
Akkermann Cement operates two cement plants and a network of 12 terminals in Russia. It acquired a majority stake in Uzbekistan-based Akhangarancement in early 2022.
Switzerland: Holcim has appointed Rodolfo Vargas Pedroza as Group Expert Geology. He previously worked as Group Lead Geology for the company from 2018. He has worked for Holcim Group since 2018 and other prior positions include Lead Geologist and Senior Mining Engineer. Before this he was the Head of Geology and Mining for Cemex from 2001 to 2011 and the Geology and Mining Manager for Cemex Colombia in the late 1990s. Vargas Pedroza is a graduate in geology from the Universidad Nacional de Colombia.
Holcim publishes Climate Report 2023
06 April 2023Switzerland: Holcim has published its Climate Report 2023, detailing the company’s progress towards meeting its sustainability commitments up to the end of 2022. The cement producer recorded net specific CO2 emissions per tonne of product of 562kg/t, down by 1.7% year-on-year from 572kg/t in 2021. In line with its 1.5°C climate change-aligned targets, Holcim is committed to 420kg/t specific CO2 emissions by 2030 and net zero by 2050.
Overall, the group’s Scope 1 CO2 emissions from cement production fell by 2.5% to 77Mt from 79Mt, while its Scope 2 emissions remained at 5Mt and its Scope 3 emissions fell by 11% to 47Mt from 53Mt. Its cement had an average clinker factor of 73%, down from 73.6% in 2021. Holcim processed 6.8Mt of construction and demolition waste, up by 3% from 6.6Mt. Meanwhile, its thermal substitution rate of alternative fuel (AF) rose to 28% from 26%.
CEO Jan Jenisch and chief sustainability officer Magali Anderson said “With our successful transformation, we reduced our CO2 per net sales by 21% in 2022, and commit to reducing it by over 10% in 2023. Accelerating the shift to net-zero cities requires deep partnerships across our value chain. In 2022 we engaged with public authorities to evolve building standards, with cities to scale up green demand in their projects, and with architects and engineers to specify sustainable solutions in their designs. We did this as a key partner for our customers, bringing solutions that help them achieve their sustainability goals.”
Holcim completes Duro-Last acquisition
04 April 2023US: Holcim has completed its acquisition of roofing systems producer Duro-Last.
CEO Jan Jenisch said "This is another exciting step in the expansion of Solutions and Products, advancing our Strategy 2025 - Accelerating Green Growth." He added "I am excited to welcome all 840 Duro-Last employees to the Holcim family. Duro-Last is a perfect strategic fit for our roofing business. Its proprietary technologies and leading brands complement our offering in the fast-growing North American market. Its energy-efficient systems and excellence in recycling will further advance our leadership in sustainability."
Mohit Kapoor appointed as head of Bamburi Cement
29 March 2023Kenya: Bamburi Cement has appointed Mohit Kapoor as its Group Chief Executive Officer (CEO), with effect from 1 April 2023. He succeeds Seddiq Hassani, who has held the position since 2018.
Kapoor is an electrical engineer who has also worked in marketing and supply chain management. He previously held the post of the CEO of Holcim Qatar. Prior to this he worked as the Head of Growth and Innovation at Holcim India, the Managing Director of Readymix Projects, the Vice President of Logistics and Supply Chain at Lafarge India and the Senior Project Manager for Lafarge Group Audit.
Huaxin Cement continues to grow revenue overseas in 2023
29 March 2023China: Huaxin Cement’s revenue fell by 6% year-on-year to US$4.43bn in 2022 from US$4.72bn in 2021. Its net profit decreased by 50% to US$393m from US$780m. Its sales volumes of cement and clinker declined by 20% to 75.3Mt and concrete sales volumes nearly doubled to 16.4Mm3. Despite flat cement demand the company expects a general domestic economic improvement, real estate market reforms and a focus on infrastructure to improve its fortunes in 2023.
During the reporting period the subsidiary of Switzerland-based Holcim started operating a 3000t/day production line at Nepal Narayani in early 2022 and commenced the second stage of a project to build a 4000t/day clinker line at Maweni in Tanzania in July 2022. Preparation work for a new clinker line project in Malawi also began. The company added that it has completed the investment and verification for ten additional projects in Africa, the Middle East and elsewhere in preparation of future business expansion. Overall, 13% of the group’s operating revenue derived from business outside of China in 2022 compared to 8% in 2021.
Germany: Intercem Engineering is set to celebrate its 20th anniversary on 14 April 2023. The group was originally founded over 50 years ago when it started by selling used machines to the cement industry. Anther subsidiary, Intercem Installation, was founded in 2007.
At present, Intercem Group consists of Intercem Engineering, Intercem Installation, both based in Oelde in Germany, and Intercem Cement, based in Zug in Switzerland. The company’s production plant is also located in Oelde. The three companies are wholly-owned subsidiaries of the Switzerland-based Intercem Holding. The group currently employs around 50 people, mainly engineers and technicians.
Intercem offers services in cement plant construction from a single source. This ranges from individual components to upgrades of existing plants up to complete cement plants. It exports around 80% of its services with its main sales markets in West Africa, France, Sweden and Germany.
After the initial shocking coverage of the Russian invasion of Ukraine, which began in February 2022, came announcements of the most extensive sanctions in history by the EU, G7 nations and others against Russia. In the EU, this effectively deconsolidated companies' Russian subsidiaries, leaving decision makers with the choice whether to sell up or hold out for better times.1 Four Russian-facing EU cement producers - Buzzi Unicem, CRH, Heidelberg Materials and Holcim - finalised their strategic responses in March 2022.
One year on, on 15 March 2023, 666 (21%) of 3110 eligible multinationals have withdrawn from Russia, according to the KSE Institute.2 Ireland-based CRH led the cement sector exit. It abandoned its Finland-based subsidiary Rudus' ready-mix concrete joint venture, LujaBetomix, on 2 March 2022. Switzerland-based Holcim took longer, but affected its exit on 14 December 2022, agreeing to sell Holcim Russia to local management. One condition of the sale was a rebrand (to Cementum, in February 2023) to withdraw the Holcim name from Russia. Unlike CRH, Holcim's Russian business included multiple cement plants - though the producer stated that it contributed less than 1% of group sales during 2021.
The KSE Institute uses the equivocal label of 'waiting' for companies which have paused investments, or scaled back operations, in Russia, while retaining their subsidiaries. This applies to 500 companies globally (16% of the pre-war total). Germany-based Heidelberg Materials acted swiftly to freeze further investments in HeidelbergCement Russia on 10 March 2022. At that time, its three cement plants were in winter shutdown. In terms of capacity, the 4.7Mt/yr-capacity Heidelberg Materials Russia constitutes 2.8% of Heidelberg Materials. In 2022, Heidelberg Materials suffered a Euro102m impairment on account of its Russian business. CEO Dominik von Achten, announcing the freeze, had described the subsidiary as a 'pure local business with no imports or exports.' Its website has since come offline, but the corporate structure presumably maintains in its frozen isolation.
1220 global multinationals - 39% of all those previously operating in Russia - are still 'continuing operations.' Among these is Buzzi Unicem. Having decided that 12 months was long enough, the Ukrainian National Agency for the Prevention of Corruption (NAPC) placed Italy-based Buzzi Unicem on its list of Russian war sponsors on 8 March 2023 for the actions of its subsidiary SLK Cement. A scathing denouncement accompanied the listing, in which the NAPC set out its main charges. It accused Buzzi Unicem of:
1. Expanding its business in Russia since the invasion;
2. Supplying its products to Russian state-owned businesses, including energy suppliers Rosatom and Rosneft;
3. Voicing support for the invasion via its social media presence.
The NAPC concluded “Buzzi Unicem's continued business in Russia means direct support and sponsorship of terrorism by Russia.”
Buzzi Unicem responded in no uncertain terms that these allegations are untrue: it has no business in Russia, and the entity bearing its logo on its (SLK Cement's) website is entirely independent in its decision-making and commercial actions.
This goes to the root of what it means to be a subsidiary of a corporation. Buzzi Unicem seeks to define the relationship as beginning and ending in operational involvement. Yet Buzzi Unicem and other corporations have invested large sums in businesses like SLK Cement. According to the NAPC, Buzzi Unicem paid Euro62m in taxes alone in Russia between 2016 and 2021. Whether they have elected to 'continue operations,' 'wait' or write in favourable buy-back options into sales contracts, as has happened in other industries, companies can be expected to seek to return to their investment.
As such, it is not entirely surprising that Buzzi Unicem should have followed up its rebuttal with a defence of SLK Cement. It stated "SLK Cement is a Russian domiciled entity operating exclusively in that country and therefore subject to domestic legislation. Payment of taxes and having employees being mobilised to the army are not discretionary decisions, rather legal obligations within the Russian jurisdiction."
In the decision to sell or hold, multinationals face the usual considerations: can they afford to yield their market share to other - less conscientious - competitors? Or, in this instance, those from Türkiye, India and China, whose potential investments are unrestrained by sanctions? Even as Holcim thrashed out its exit deal in October 2022, China-based West China Cement announced plans for a new US$260m, 1.2Mt/yr cement plant in Tatarstan, Volga Federal District. Meanwhile, Cemros (formerly Eurocement) is carrying out a Euro3m mill upgrade at its Lipetsk integrated cement plant in Central Federal District, which will increase the plant's capacity by 20% upon commissioning in early 2023. Between them, Central Federal District and Volga Federal District host four former Holcim cement plants.
12 months into the Russian invasion of Ukraine, an onslaught of withdrawals has shrunk, but not collapsed, the Russian economy.3 The Russian government insists that cement demand remains high (up by 2.1% year-on-year to 58.3Mt during the first 11 months of 2022, according to the Russian cement association Soyuzcement).4 The country has substituted new sources of imports for those lost since the beginning of the invasion, the government claims. It is even preparing for a cement shortage from 2024 onward by 'further developing domestic production capacities.'
Far from shrinking, Russian cement production rose by approximately 2.5% year-on-year to 60.7Mt in 2022.4, 5 The two aforementioned districts - Central Federal District and Volga Federal District - contributed a healthy 15.3Mt (25%) and 13.4Mt (22%) respectively. If the statistics are to be believed, the EU's recalled producers are missing out on a bonanza.
At the same time, all four EU-based producers face the parallel burden of increased costs in their key markets, as sanctions keep energy prices at an all-time high, and nowhere more so than in Europe. These sanctions purport to target Russian businesses and individuals, but their bite is far less discriminating. Companies may well wonder why they are being penalised by governments whose policies failed to prevent a Russian invasion of Ukraine in the first place.
We have no idea what will happen in Ukraine and Russia in the rest of 2023, but we can be sure it will be uncertain territory for the two countries’ cement producers. Those with (former) assets in the Russian market will have to continue their delicate balancing act.
1. European Commission, 'Frequently Asked Questions,' 16 March 2022, https://trade.ec.europa.eu/doclib/docs/2022/march/tradoc_160079.pdf
2. KSE Institute, 'Stop Doing Business with Russia,' 15 March 2023, https://leave-russia.org/leaving-companies?flt%5B147%5D%5Beq%5D%5B%5D=9062
3. European Council, 'Infographic - Impact of sanctions on the Russian economy ,' 9 March 2023, https://www.consilium.europa.eu/en/infographics/impact-sanctions-russian-economy/
4. Soyuzcement, 'Cement Review,' December 2022, https://soyuzcem.ru/documents/%D0%A6%D0%B5%D0%BC%D0%B5%D0%BD%D1%82%D0%BD%D0%BE%D0%B5_%D0%BE%D0%B1%D0%BE%D0%B7%D1%80%D0%B5%D0%BD%D0%B8%D0%B5_%D0%B4%D0%B5%D0%BA%D0%B0%D0%B1%D1%80%D1%8C%202022.pdf
5. BusinessStat, 'In 2022, 60.7 million tons of cement were produced in Russia,' 21 February 2023, https://marketing.rbc.ru/articles/14025/