September 2024
CPV considers plant closure 25 March 2013
Spain: Cement producer Cementos Portland Valderrivas (CPV) is considering the closure of one of its production units in Spain, according to Juan Bejar Ochoa, CEO of the company's majority shareholder FCC. The move looks likely to affect one of the three factories in northern Spain or one of the two plants in Catalonia. Bejar justified the measure by highlighting the 20% decrease in Spanish market demand in 2012. The decision on which unit will be shut down will be taken after analyses of transport and production costs.
ThyssenKrupp to build 1.7Mt/yr cement plant in Indonesia 22 March 2013
Indonesia: ThyssenKrupp Polysius has won a contract from PT Holcim Indonesia Tbk., to build a second cement plant near the town of Tuban on the northern coast of the island of Java. The contract is worth around US$250m and the plant is scheduled to start production in 2015. Tuban 1, the initially-awarded project, is due to begin operation in June 2013. Tuban 2, the newly-awarded project, and Tuban 1 will each have a capacity of 1.7Mt/yr of cement.
"This follow-up order is proof of our good partnership with the customer and shows that our technological solutions and leading engineering expertise are supporting Holcim in the growth of the Indonesian cement industry," said Dr Hans Christoph Atzpodien, CEO of the ThyssenKrupp Polysius' Industrial Solutions business area. "We are firmly focused on the markets of the future."
For both plants ThyssenKrupp Polysius is supplying state-of-the-art equipment covering raw material preparation, clinker production, cement loading and fuel preparation. A POLAB laboratory automation system is being installed for quality monitoring and control.
The Indonesian cement market is predicted to grow at a double-digit rate in 2013. With a production capacity of 8.2Mt/yr Holcim Indonesia is one of the country's top three cement manufacturers.
UK: The Minerals Products Association (MPA) has welcomed measures in the UK government's 2013 budget that will help boost the outlook for the cement industry and the wider mineral products and construction sectors. The MPA singled out the decision to freeze the indexation of the Aggregates Levy until April 2014 and the decision to introduce the Climate Change Levy mineralogical and metallurgical exemption for energy intensive industries such as cement and lime.
"The government is clearly listening and understands that investing in infrastructure and construction is key to securing growth. The issue remains of ensuring that cash flows into action on the ground to help improve confidence and induce private sector investment, which is needed to accelerate growth in demand," said Nigel Jackson, chief executive of the MPA.
West China Cement profit drops 24% in 2012 21 March 2013
China: West China Cement has reported that its gross profit fell by 23.7% to US$109m in 2012 from US$142m in 2011. The Chinese cement producer attributed the shortfall on a decreasing selling price, increases in electricity costs and higher overheads due to lower productivity.
The company's revenue rose by 10.5% to US$567m from US$513m. Earnings before interest, taxes, depreciation and amortisation (EBIDTA) fell by 9% to US$170m from US$187m. Cement sales volumes rose by 22% to 14.3Mt in 2012 from 11.7Mt in 2011.
In its annual report West China Cement reported that it is consolidating its position as the largest cement producer in Shaanxi Province as well as expanding into Xinjiang Province, where economic and infrastructure growth promoted by the Chinese government's Western Development Policy remains a key feature of the 12th Five-Year Plan. For 2013 the company expects the recovery in infrastructure demand in the second half of 2012 to continue. However, increased overall capacity in Xinjiang Province is expected to continue impacting upon cement prices in that region.
Bold moves from HeidelbergCement 20 March 2013
Somebody at HeidelbergCement is brave. Making an investment in a cement market characterised in 2012 by job losses and carbon taxation takes some nerve. Yet this is exactly what HeidelbergCement has done with the announcement that it plans to take joint control of Cement Australia with Holcim.
So what's in it for Holcim and HeidelbergCement?
Opportunity and foreign supply chains to minimise the carbon tax seem to be the main reasons. With Holcim's 2012 financial performance dragged down by Europe and Africa, its cost reduction programme, the 'Holcim Leadership Journey,' continues into 2013. Australia, as one of the few disappointing spots in the producer's Asia-Pacific region, is an obvious asset to sell. By contrast, HeidelbergCement reported growth in its operating income in 2012.
With regards to supply chains, both Boral and Adelaide Brighton – Cement Australia's competitors in Australia – acted to seize foreign clinker supplies in 2012. As they are multinationals, Holcim and HeidelbergCement have ready-built supply chains. Figures from the Global Cement Directory 2013 show that Holcim holds a cement production capacity of 9.7Mt in Indonesia, 5.75Mt in the Philippines and 0.55Mt in New Zealand. HeidelbergCement hold 16.5Mt in Indonesia. Despite regular annual high performance and regular capacity growth in the cement industry in Indonesia and the Philippines, having the option to export excess clinker to nearby Australia must be enticing.
For Holcim, minimising risk may be a key factor in their decision to reduce their share in Cement Australia. Holcim dodged mentioning the country's cement performance in its 2013 outlook although it did report an overall volume decrease across all its business lines in 2012. Boral expects its sales volumes to remain flat in the first six months of 2013, with pricing challenged by the high Australian Dollar and low sea freight prices. Adelaide Brighton expects its demand for cement to continue coming from South Australia, Western Australia and the Northern Territory. Adelaide Brighton also took pains to point out the carbon tax will hit its 2013 profits by US$6m, nearly 4% of its 2012 profit. Going 50-50 with HeidelbergCement shares the risks for Holcim as well as the profits.
Holcim faces the same dilemma that Lafarge faced in mid-2012 when it sold two cement plants in the US. It needs to sell assets to cut costs and raise capital but it also needs to pick assets to sell that won't boost its competitors too much. The on-going recovery in the US building industry suggests at present that Lafarge may have made a poor choice in North America. Holcim's decision suggests that they aren't expecting a recovery in Australia anytime soon.
Wolfgang Reitzle to become chairman of Holcim in 2014 20 March 2013
Switzerland: Swiss-based multinational building materials producer Holcim has announced that Wolfgang Reitzle will take over as chairman in 2014. To ensure continuity, current chairman Rolf Soiron has been proposed for re-election at the annual general meeting of 17 April 2013. Also at the meeting the board of directors will propose the election of Hanne Birgitte Breinbjerg Sørensen and Anne Wade to the board of directors of Holcim.
Sørensen is currently the CEO of Maersk Tankers based in Copenhagen, one of the world's largest tanker operators. She holds an MSc in Business Economy from the University of Aarhus.
Wade, an investor with extensive experience in capital markets, was the Senior Vice President and Director of an investment management company, Capital International, based in London from 1995 to 2012. She graduated with a BA from Harvard University and holds a Master of Science from the London School of Economics.
In addition the board of directors is proposing the re-election of Beat Hess for a three year term. He is currently deputy chairman of the board of directors. Markus Akermann and Peter Küpfer are no longer available for re-election. Christine Binswanger has resigned from the board effective from the date of the meeting.
Australia: Swiss cement maker Holcim has announced plans to operate Cement Australia as a joint venture (JV), in which both Holcim and Germany's HeidelbergCement AG will hold equal 50% stakes. Holcim will therefore sell 25% of its stake in Cement Australia to HeidelbergCement for an undisclosed amount. The move has already been approved by the Austrian authorities, according to Holcim.
Cement Australia operates two cement plants and a grinding station in the east and southeast of Australia and in Tasmania with a total cement capacity of 4.2Mt/yr. In addition, a new grinding station in Port Kembla with an annual capacity of 1.1Mt/yr is expected to go online in 2013.
Lafarge Surma to supply Madina Cement 20 March 2013
Bangladesh: Lafarge Surma Cement Ltd signed an agreement with Madina Cement Industries Ltd at a ceremony organised at the company's headquarters. Under the terms of the deal, Lafarge Surma will supply its high quality clinker to Madina Cement from its integrated plant at Chhatak to produce 'Powercrete.' This will be subject to strict quality controls by employees of Lafarge Surma to ensure world-class quality that Lafarge Surma promises to deliver to its customers.
Furthermore the production process will follow the highest safety standards. Lafarge will shortly launch Powercrete, with the aim of strengthening its market position in Bangladesh.
Holcim Lebanon to burn expired pharmaceuticals 20 March 2013
Lebanon: Holcim has been named by the Environment Ministry as the country's sole disposer of pharmaceutical waste, according to a press release. The ministry issued a permit to the company to burn the drugs in its cement kiln. Holcim is in the process of destroying hundreds of tons of expired pharmaceuticals in the kiln at its factory in Shekka, in the north of Lebanon.
The drugs that are to be burnt were discovered during investigations that uncovered hundreds of tonnes of expired medicinal goods around the country. Officials sought a responsible way to dispose of the material and discovered that they could be used as an alternative fuel for a cement kiln. The high temperatures (~1500°C) in the kiln ensure that organic materials are completely destroyed during combustion.
Hanson’s EcoPlus reduces use of Ordinary Portland Cement 20 March 2013
UK: Building materials producer Hanson, a UK-based part of Germany's HeidelbergCement, has launched a new range of quality concretes designed to reduce the CO2 emissions associated with construction projects. The EcoPlus range contains Hanson Regen, a sustainable substitute for Ordinary Portland Cement (OPC) in concrete. Hanson Regen is a ground granulated blastfurnace slag (GGBS) and can replace up to 70% of the OPC content. Replacing 1t of OPC with 1t of Regen in EcoPlus concrete reduces the embodied CO2 by around 850kg.
Paul Lacey, Hanson's head of sustainability and marketing, said, "EcoPlus is designed to help engineers, specifiers and contractors meet current and future environmental legislation. Our online carbon calculator shows the CO2 savings that can be made by specifying one of our eight standard EcoPlus mixes, which are suitable for foundations, pavements and structural projects. We can also design and supply bespoke mixes."
Using Regen in EcoPlus also improves the durability of structures, particularly where sulphates and chlorides are an issue, and gives a lighter, more aesthetically pleasing colour to the concrete.