September 2024
Spain: Cement consumption in Spain witnessed a 1.5% year-on-year decline in February 2024, marking nine consecutive months of decreases amid high interest rates, surging housing prices, and a stagnant outlook for the construction sector. According to Oficemen, February's consumption reached 1.1Mt, down from 1.2Mt in February 2023. The export sector experienced an even sharper fall, dropping 13.9% year-on-year in February 2024, continuing an eight-month decline, with a 9.8% decrease in exports from February 2023 to February 2024. Conversely, imports have risen by 11.3%.
Oficemen's general director, Aniceto Zaragoza, said “With nine months already in decline, the concern with which we observe the evolution of cement consumption and, of course, the construction sector, is accentuated.” Zaragoza called for increased collaboration between public and private institutions in public contracting processes to sustain infrastructure competitiveness. The slump in cement consumption, which has been ongoing since 2019, coincides with the European Central Bank's interest rate hikes, leading to higher mortgage costs and reduced demand in the housing market.
S&P upgrades Cemex to Investment Grade 14 March 2024
Mexico: Standard & Poor's (S&P) has raised Cemex's long-term global scale issuer credit rating to Investment Grade (BBB-). The upgrade is attributed to Cemex's robust financial and operating performance, effective deleveraging strategy, and adaptable capital allocation.
The upgrade to Investment Grade marks a significant achievement for Cemex, reflecting its record results and consistent financial performance over several years.
"Achieving an investment-grade credit rating from S&P is a very important milestone for Cemex," said CEO Fernando A González. In 2023, Cemex reported a 25% growth in EBITDA and more than a doubling in Free Cash Flow after maintenance capex.
S&P also elevated Cemex's national scale issue-level rating in Mexico from mxAA to mxAA+.
Cemex Croatia to install solar plants with EU funding 14 March 2024
Croatia: Cemex Croatia has won contracts to install solar power plants at three of its facilities, co-financed by the EU's Modernisation Fund. The company will build new solar plants at Sv. Juraj and Sv. Kajo cement plants in Kaštel Sućurac and Solin, respectively, and at the Podsused production facility in Zagreb. The total investment is valued at €5m.
The solar power plants, with a combined capacity of 6.34MW, will be installed on the roofs of these facilities. The Sv. Juraj plant will receive a 3.79MW system worth €3m, the Sv. Kajo plant a 2.14MW system valued at €1.7m, and the Podsused facility a 0.41MW system costing about €318,000. The EU's Modernisation Fund will cover 60% of the costs for the Sv. Juraj and Sv. Kajo projects and 50% for the Podsused project.
"The savings that these measures will bring to us in terms of energy consumption will increase the efficiency of our production and reduce emissions from our operations. These are just some of the projects we are planning to achieve our climate goals" said Marijan Zekić, Cemex Croatia’s project and quality assurance manager.
Neo-Eco launches low-carbon clay binder 14 March 2024
France: Neo-Eco has developed a low-carbon cement binder from clay excavated during the Grand Paris Express project. The process, developed at IMT Nord Europe, involves flash-calcination at about 700°C, allowing it to replace part of the clinker and emit approximately five times less CO2 than traditional methods. Neo-Eco's director, Christophe Deboffe, said that this new ingredient could constitute 30% of cement, maintaining the cost similar to traditional binders.
To commercialise this breakthrough, Neo-Eco established Neocem, a subsidiary based near Lille. Neocem has raised €23m to build a production plant in Saint-Maximin, Oise. Strategically located near waterways and Île-de-France, the plant will directly receive excavated materials from the Société du Grand Paris.
Starting in 2025, the facility will produce 100,000t/yr of flash-calcined clay, with potential to double its capacity in the future. Deboffe sees this as just the beginning, planning to establish more plants across France and Europe to meet the cement and ready-mix concrete industry's demand.
The clay supply is estimated to exceed 100Mt, ensuring a sustainable and ample source for the binder.
The facility is supported by the French government's ‘Première usine’ initiative under the France 2030 investment plan, with funding from investors like Bpifrance and CB Green. CB Green, based in Calais, is also developing a limestone filler production plant in Dunkerque with Ecocem, pointing to a future where cement could be composed equally of flash-calcined clay, limestone filler, and clinker. Bottom of Form
Fremantle Ports unveils clinker storage dome 14 March 2024
Australia: Fremantle Ports has completed the construction of a 40m-high cement clinker storage dome at Kwinana Bulk Terminal in the Outer Harbour. This dome, a first in Western Australia and the second in Australia, can store an entire 40,000t shipment of clinker.
The new storage solution links to the adjacent Cockburn Cement plant and serves BGC, another major clinker importer. The dome was chosen for its smaller ground footprint compared to traditional dry product sheds.
CEO Michael Parker said "Without clinker, industry stops. Every tonne entering Western Australia comes through Kwinana Bulk Terminal.”
The terminal imports over 1.1Mt/yr of clinker, sourced from Indonesia, Japan, Malaysia, the Philippines and the United Arab Emirates.
Humboldt Wedag India partners with KIMA Process Control 14 March 2024
India/Germany: Humboldt Wedag India (HW India) has become the exclusive sales and service partner for KIMA Process Control. This partnership enhances HW India's offerings with KIMA's advanced products and is expected to lead to significant cost savings, increased profitability, and enhanced competitiveness for Indian cement manufacturers.
"We are excited to partner with KIMA Process Control, a global leader in cement process optimisation. This collaboration will help us deliver innovative solutions and exceptional value to our customers." said Ashok Dembla, President of HW India. Dirk Schmidt, Director of KIMA Process Control, also expressed his enthusiasm for the partnership, highlighting HW India's understanding of the Indian market and technical expertise.
World: Investment firm Insight Partners has forecast a composite annual growth rate (CAGR) of 3.3% in the global green cement and concrete market between 2023 and 2030. This will result in a total value of US$990m in 2030, compared to US$806m in 2023. Regionally, the firm expects the sharpest growth in South and Central America, with a CAGR of 10% to US$7.9m in 2030. North America is expected to grow at a rate of 5.4% annually, to US$190m, followed by Europe, at 4.5% to US$226m, Middle East and Africa, at 2.9% to US$13m, and Asia-Pacific, at 1.4% to US$553m. In 2023, Asia-Pacific commanded a 61% share of the global market. Europe’s share was 20% and that of North America was 16%.
Update on Türkiye, March 2024 13 March 2024
TürkÇimento revealed this week that cement production in Türkiye grew by 10.5% year-on-year to 81.5Mt in 2023. In a press release describing the progress of the local cement sector, the cement association reported that domestic sales rose by 19% to 65Mt but that exports fell by 28% to just under 20Mt. Fatih Yücelik, the chair of TürkÇimento, also said that his country was the second largest exporter of cement in the world in 2023 and that its most important target market was the US. He noted that the construction sector grew by 8% during 2023, that reconstruction projects were enacted following earthquakes in early 2023 but that no further growth in domestic sales of cement was anticipated in 2024.
As is standard for these kinds of occasions, Yücelik also raised the association’s sustainability ambitions, describing his sector as one “whose main goal is to provide low-carbon production.” He added that the Turkish cement industry supports the country’s net zero target of 2053. To this end the association has also released its first sustainability report, for 2022, covering 48 of the country’s 52 integrated plants. The Hürriyet Daily News newspaper offered one reason for this enthusiasm for sustainability: the US$30bn in investment required to meet that 2053 net-zero target. It also reported that Yücelik said that the industry needed to spend US$2bn towards meeting the incoming requirements of the European Union Carbon Border Adjustment Mechanism (CBAM).
Graph 1: Domestic and export cement sales in Türkiye, January – October, 2017 – 2023. Source: TürkÇimento.
TürkÇimento’s data for 2023 currently runs up to October 2023 but it supports Yücelik’s assessment. As can be seen in Graph 1, domestic sales of cement rose sharply in the first 10 months of 2023, by 20% year-on-year to 53.1Mt, yet exports fell almost as abruptly, by 18% to 13Mt. This is noteworthy, as exports had been rising steadily each year since 2018. Italy-based Cementir provided some context here in its annual report for 2023 saying that it had decided to focus on the domestic market due to greater profitability. Heidelberg Materials’ joint-venture Akçansa echoes these comments, blaming declining exports on “historically low freight rates increasing competitiveness of southeast Asian suppliers” while emphasising that the shift to the domestic market was made to meet increasing demand.
Graph 2: Revenue of selected large Turkish cement producers, 2022 - 2023. Source: Company reports.
Financial information from the larger Turkish cement producers that have released their results for 2023 follows the same pattern. Three of the four companies included in Graph 2 saw sales revenue grow in 2023. The one that saw its revenue fall, Nuh Çimento, is a major exporter. In 2022 for example it supplied 18% of the country’s total cement exports. All of these companies saw operating profit or earnings increase though.
The other big Türkiye-based news story this week was that Taiwan Cement Corporation (TCC) completed the latest increase to its stakes of Cimpor Global Holdings joint-ventures in Türkiye and Portugal. TCC now owns a 60% stake of the business in Türkiye and a 100% stake in Portugal. With respect to the business in Türkiye this means that TCC now has control of the country’s largest cement producer, OYAK Çimento. Once again the CBAM received a mention, with TCC saying in its valedictory statement that it believed that, “whether it's domestic or imported cement, low-carbon cement will become the main competitive advantage for the cement companies entering the European market.”
The domestic market in Türkiye may have seen a bounce in 2023 but the attention of both TürkÇimento, TCC and others are firmly set on the wider market in the region. TürkÇimento’s Fatih Yücelik said that the country’s cement production capacity was 120Mt/yr and that the population would have to be 150m to eliminate the need for exports. Its population is currently just under 85m. Yücelik set a value of US$2bn for his sector to adjust to CBAM but he also remarked that the income from exports in 2023 was around US$1.3bn. This is not an easy investment ‘pill’ to swallow but one that the country will have to digest if it wants to keep its export levels up.
Marcos Cela appointed as head of Cementos Molins 13 March 2024
Spain: Cementos Molins has appointed Marcos Cela as its CEO. He will succeed Julio Rodríguez, who has spent nine years in the post, at the end of June 2024 after the shareholders annual general meeting,
Cela holds a bachelor's degree in business administration from the University of Barcelona, a master in business administration qualification from the ESADE Business School and a senior management programme qualification from the IESE Business School. He started his career in 1995 in the finances division of Decathlon Spain. Four years later, he assumed the role of Credit and Treasury Director at BIC Graphic Europe, before joining Cementos Molins in 2004 as chief financial officer, a position he held until early 2015. Since then, Cela has been a member of the executive committee, working as the Executive VP for Asia, Africa, and South America regions.
José María Barroso appointed as CEO of CANACEM 13 March 2024
Mexico: The National Cement Chamber (CANACEM) has appointed José María Barroso as its CEO. He will follow on from Jaime Hill Tinoco, the head of Holcim México, in the role, according to the El Financiero newspaper. Barroso’s tenure will cover the 2024 – 2025 period.
Barroso is a graduate of the Instituto Tecnologico de Merida in Yucatan and he also holds a master’s degree in international trade form the same institution. He holds over 40 years of experience in the cement sector working both nationally and internationally for Cemex. He joined Cementos Moctezuma in 2010 as its Sales Director before becoming its Director General in 2018.