September 2024
Huaxin Cement reports strong start to 2021 but warns of slow demand in second quarter 03 September 2021
China: Huaxin Cement’s sales revenue increased by 17% year-on-year to US$2.28bn in the first half of 2021 from US$1.95bn in the same period in 2020. Net profit rose by 8.3% to US$378m from US$349m. Cement and clinker sales grew by 14% to 37Mt and concrete sales volumes more than doubled to 3.36Mm3. The cement producer reported that demand for cement decreased in May and June 2021 due to bad weather and price rises of raw materials leading to reduced construction activity.
Mannok commissions new bagging system from Haver & Boecker 03 September 2021
UK: Mannok has commissioned a Euro2.1m bagging system supplied by Germany-based Haver & Boecker. The order included a Roto-Packer Adams 10 spout bag filling system and a new automatic film reel changer, designed to run at 1200 bags/hr. Installation took place in the second quarter of 2021 and the new bagging unit is now in production. The upgrade now gives Mannok the capacity to pack around 50t/hr of cement in weatherproof bags.
Chief executive officer Liam McCaffrey said, “This is a major investment in our Cement operations which completes the second phase of our investment in our weatherproof bagging line, upgrading it from a single to a double bagging line with a significant increase in output capacity. Our initial investment to bring our weatherproof polyethylene bags to the market was in response to demand from Great Britain-based merchants and we later introduced the bags to the Irish market, where the response was equally positive.”
The cement producer operates an integrated plant at Derrylin, Fermanagh in Northern Ireland. It previously installed a weatherproof bagging line in 2018 that allows it to extend its range of bagged cements.
JK Cement to invest US$410m to expand capacity to 23Mt/yr by 2023 02 September 2021
India: JK Cement plans to invest a total of US$410m in two new cement plant projects to expand its total production capacity to 23Mt/yr from 15Mt/yr. The Economic Times newspaper has reported that the company is in the process of establishing a 2Mt/yr integrated plant at Panna in Madhya Pradesh. It is in the process of establishing a second new integrated plant at Hamirpur in Uttar Pradesh, also with a capacity of 2Mt/yr. Both plants are scheduled for commissioning in 2023. The investments aim to increase the company’s presence in the northern and central Indian cement markets. 12Mt/yr of its current capacity is located in the region, compared to 3.0Mt/yr in the south.
Chief executive officer Madhav Singhania said “While the northern market is very attractive in terms of demand and capacity utilisation, we have the capabilities to become a market leader in the central region."
In 2020, JK Cement’s average capacity utilisation was between 75% and 80%.
India’s new waste heat recovery units total 175MW in 2021 and 2022 financial years 02 September 2021
India: The total new waste heat recovery (WHR) unit capacity of cement producers is expected to reach 175MW in the two years ending on 31 March 2022. Rating agency ICRA has valued the total investment in new WHR units over the period as up to US$230m, according to the Press Trust of India. A market report by ICRA reports that power generation using WHR costs around US$0.02/kWh compared to US$0.7/kWh from a captive coal power plant. Cement companies that replace 25% of total power capacity with WHR can potentially save around 15% from existing power costs.
Ambuja Cement saves 70Ml of water with rainwater harvesting systems 02 September 2021
India: Ambuja Cement has saved 70Ml of water since the beginning of 2020 through the installation of rooftop rainwater harvesting systems at 268 construction sites across India.
Neeraj Akhoury, the chief executive officer of Ambuja Cement, said "The scope and opportunities for creating a sustainable future are immense. As part of the global organisation, Holcim, Ambuja Cement's ambition is to be a part of the solution to the sustainability challenges faced today. I am pleased with the progress that we have made through our efforts, and we will continue to put into action bolder plans for emission reduction, resource optimisation and water conservation to build a sustainable India."
Turkish builders down tools in protest against high cement prices 02 September 2021
Turkey: Builders have declared a one-day ‘strike’ on 2 September 2021 to protest against high cement prices. The Turkish Builders Confederation (IMKON) told the government that, though the prices of all commodities rose following the onset of the Covid-19 pandemic, the cement price rise is disproportionate, according to the Dünya newspaper. Producers responded that they have recorded sharp increases in input prices. Electricity costs rose by 64% year-on-year in July 2021, while coal costs more than doubled over the same period.
Prison sentences for former Iraqi Cement executive and general manager 02 September 2021
Iraq: The Central Anti-Corruption Criminal Court has sentenced former Iraqi Cement executive director Baha Abed and general manager Ali Hadi to six years in prison. According to the National Iraqi News Agency, Abed appointed Hadi as general manager in exchange for Hadi referring the company’s equipment contracts to Abed’s own companies.
Update on China, September 2021 01 September 2021
It’s time for a macroscopic view of the Chinese cement sector this week with the release of the half-year financial results by some of the larger Chinese cement producers. On the national level the picture so far in 2021 has been one of continued recovery from the coronavirus lockdowns at the start of the year and then a slowing market as state controls on real estate speculation started to take effect. However, poor weather in the spring and mounting raw material prices appear to have compounded the effects of the real estate regulations, leading to price falls.
Cement output data from the National Bureau of Statistics of China in Graph 1 shows that local production took a knock in the first quarter of 2020 due to the coronavirus pandemic and this strongly recovered in the same period in 2021. The market recovered fast in mid-2020 and so the year-on-year growth for the second quarter was less in 2021. Output on a monthly basis remained ahead year-on-year from April 2020 and stayed ahead until May 2021. However, output in June 2021 was behind the figure in June 2020 and the figure for July 2021 was behind both July 2020 and July 2019.
Graph 1: Cement output by quarter in China, 2019 – mid-2021. Source: National Bureau of Statistics of China.
The Chinese Cement Association (CCA) was lamenting falling cement prices at the start of July 2021. It blamed the situation on slowing infrastructure development in some regions, increasing government restrictions on real estate development, especially poor mid-year weather and higher input prices such as for steel. China Resources Cement (CRC) expanded upon the point about increasing real estate regulations in its financial results for the first half of 2021 explaining that the Chinese government has been promoting a policy that aims to ensure that “residential properties are not for speculation” including controls on the financing of real estate. Later in mid-August 2021 the CCA reported that prices were recovering in east and central-southern regions although the situation remained poor in Guizhou province with shipments down to 60% of normal levels. Production control measures are expected to be implemented to stabilise the situation.
Graph 2: Sales revenue of large Chinese cement producers in first half of year, 2019 – 2021. Source: Company reports.
On the corporate side the sales revenue from some of the large Chinese cement producers mostly show the usual gap-tooth pattern that coronavirus has created everywhere as the market recovered. Notably Anhui Conch managed to avoid falling sales year-on-year in the first half of 2020. However, the CCA’s observation above about rising input costs is visible in the falling profits of some (but not all) of the companies covered here. For example, Anhui Conch’s net profit fell by 7% year-on-year to US$2.32bn in the first half of 2021. It blamed this on a significant rise in the price of raw coal. CRC also reported falling profits attributable to increased production costs.
CNBM reported an increase to cement and clinker sales volumes of 7.6% to 177Mt and concrete sales volumes by 13.4% to 52Mm3. It noted that, “In the first half of 2021, the national cement market showed the characteristics of high price level fluctuation adjustment.” From January to April 2021 local fiscal policy boosted demand for cement but from May 2021 continuous heavy rainfall and increasing bulk commodity prices slowed infrastructure project development. Anhui Conch’s cement and clinker sales volumes for both production and trading grew by 11.5% to 208Mt. It reported stable market demand in eastern, central and southern regions but noted falling prices in the west.
Looking ahead, two issues, among many, to consider are carbon trading and imports. The former has been coming for a while and was launched formally online nationally in mid-July 2021 for the power generation industry. The carbon price was nearly Euro7/t in late July 2021 in China compared to around Euro53/t in the European Union. Cement and steel are expected to join the Chinese national scheme in the next phase although analysts believe that issues such as data gathering, permit allocation rules, accounting standards, sector reduction targets and related financial support all need to be improved before this can happen. Imports are a connected issue and it has been interesting in recent months to hear financial analysts point out the risks, for example, of major exporting nations such as Vietnam relying on China so much. The CCA reckons that China imported 33.4Mt of clinker in 2020, an increase of 47% year-on-year, with 60% of this derived from Vietnam. With the Chinese government trying to tackle cement production overcapacity and meet growing environmental targets, imports look set to become a ‘hot ticket’ issue. In this context it is telling to see talk from the CCA of ensuring standards for imports such as verified carbon emissions. Naturally, the imports that could be trusted the most will probably be the ones from plants that Chinese cement producers have built themselves overseas. As waste importers into China found out previously, relying heavily on one market with strong state controls carries considerable risks. Cement exporters in South-East Asia take note.
Caterina Costa de García appointed as chair of Holcim Ecuador 01 September 2021
Ecuador: Holcim Ecuador has appointed Caterina Costa de García as the chair of its board of directors. She is the first woman in the post and succeeds Oscar OrrantiaVernaza, who has stepped down to become the country’s ambassador to France.
Costa de García has worked for plastics manufacturer Poligrup for over 25 years becoming executive president in late 2020. She has also held leading positions at a number of national business associations such as the Chamber of Industries of Guayaquil, the Ecuadorian Business Committee and the Ecuadorian and Latin American Plastics Associations. She took her first degree from the Catholic University of Santiago in Guayaquil, earned a master’s degree in comparative law from New York University and a Master of Business Administration (MBA) from the Federico Santa María Technical University.
Holcim Philippines makes sustainability-related appointments 01 September 2021
Philippines: Holcim Philippines has appointed Zoe Sibala Senior Vice President of Sustainability and expanded the role of Richard Cruz, Vice President of Health, Safety and Security to include the environment portfolio.
Sibala was Vice President of Strategy from 2017. She held management roles in finance, strategy and business development in Lafarge Philippines’ aggregates unit, which was acquired by Holcim in 2015. She holds a Master of Business Administration (MBA) from De La Salle University and a degree in economics from the University of the Philippines.
Cruz was appointed Vice President for Health, Safety and Security in 2018. Prior to this, he held management roles in the department. He joined Holcim Philippines' waste management unit Geocycle as laboratory engineer in 2008 and helped it attain an Integrated Management System certification (Quality, H&S and Environment). A graduate of the Central Luzon State University, Cruz is a licensed chemist and a certified security professional. He holds certifications in health and safety from accrediting organisations such as the National Examination Board in Occupational Safety and Health and the International Safety Rating System.