
Displaying items by tag: Anhui Conch
Anhui Conch on finance hunt for terminal in Indonesia
02 October 2018Indonesia: China’s Anhui Conch is looking for finance to support a US$105m terminal it wants to build in Palembang. Yu Jun, a project manager at the cement producer said that the project will be able to import and export 0.4Mt/yr and it will have a berth for ships of 3000DWT, according to Inside International Industrials. The company hopes to secure funding by the end of February 2019.
China: Anhui Conch says it has resumed production at three production lines at the cement plant run by its Tongling Conch subsidiary at Gusheng in Anhui province. In late July 2018, Tongling Conch received a written notification from the Tongling Environmental Protection Bureau requesting the ‘immediate’ resumption of operation of Tongling Conch’s waste incineration and ancillary systems for treatment of domestic waste of Tongling City. The suspension of production at the cement plant followed the temporary closure of a pier used by the plant in late May 2018 in accordance with new government regulations on drinking water supply and pollution.
China: Anhui Conch expects that its profit will double year-on-year for the first half of 2018. The company reported an unaudited net profit of US$1.01bn in the first half of 2017. It has attributed the growth in profit to a ‘significant’ increase in the price of its products and an increase in revenue. The cement producer plans to release its half year report by the end of August 2018.
Wuhu suspends cement production for six days
29 June 2018China: The city of Wuhu has suspended cement production for local producers for six days. Anhui Conch, South Cement and Leida Cement have all been affected, according to Hexun. Local production is expected to drop by 0.5Mt/yr.
China: Anhui Conch has suspended production at three of its production lines at the cement plant run by its Tongling Conch subsidiary at Gusheng in Anhui province. The suspension has followed the temporary closure of a pier used by the plant in late May 2018 in accordance with new government regulations on drinking water supply and pollution.
Use of the pier has been suspended as it is close to the Tongling Water Treatment Plant. The pier is used to export cement and clinker products from the unit and bring in raw materials such as coal. The temporary suspension of the plant’s production lines will reduce its clinker production capacity by 58% to just under 9Mt/yr from 15Mt/yr.
The cement producer has defended its environmental record, pointing out that the pier was approved with all the necessary licences and environmental approvals in 1987. Construction of the water treatment plant started in 1992.
Clinker products produced by Tongling Conch are mainly sold to Anhui Conch’s subsidiaries, including cement grinding plants along the Yangtze River and on the coast. The company plans to source clinker from other plants to continue supporting the affected grinding plants.
Anhui Conch considering cement plant in Odessa
01 June 2018Ukraine: China’s Anhui Conch has discussed building a cement plant in Odessa with Anatoliy Urbansky, the chairman of the Odessa Regional Council. Delegates from the General Consulate of China in Odessa and the Ukrainian branch of China Metallurgical Construction Engineering Group attended the meeting as well, according to Interfax. Anhui Conch is also considering building a construction materials park and investing in tourism in the region.
China: Anhui Conch Cement’s sales revenue rose by 38% year-on-year to US$2.98bn in the first quarter of 2018 from US$2.16bn in the same period in 2017. Its net profit rose more than doubled to US$757m from US$341m, according to Dow Jones. The rise in sales and profits has been attributed to rising cement prices in smaller cities and demand from the Xiongan New Area project. The cement producer also said that it received a government subsidy of US$18m.
Anhui Conch to open office in Tunis
03 April 2018Tunisia: China’s Anhui Conch plans to open an office in Tunis to explore investment opportunities. A delegation from the cement producer met with Slim Feriani, the Minister of Industry and Small and Medium Enterprises, according to African Manager.
Update on China in 2017
28 March 2018Many of the Chinese cement producers have released their annual results for 2017 over the last week, giving us plenty to consider. The first takeaway is the stabilisation of cement sales since 2014. As can be seen in Graph 1, National Bureau of Statistics data shows that cement sales grew year-on-year from 2008 to 2014. This trend stopped in 2015 and then government mandated measures to control production overcapacity kicked-in such as a industry consolidation, shutting ‘obsolete’ plants and seasonal closures. Although it’s not shown here, that last measure, also known as peak shifting, cans be seen in quarterly sales data, with an 8% year-on-year fall in cement sales to 578Mt in the fourth quarter of 2017.
Graph 1: Cement sales in China, 2007 – 2017. Source: National Bureau of Statistics.
Looking at the sales revenue from the larger producers in 2017 doesn’t show a great deal except for the massive lead the two largest producers – CNBM and Anhui Conch – hold over their rivals. CNBM reported sales roughly twice as large as Anhui Conch, which in turn reported sales twice as large as China Resources Cement (CRC). With everything set for the merger between CNBM and Sinoma to complete at some point in the second quarter of 2018, that leader’s advantage can only get bigger.
Graph 2: Sales revenue of selected Chinese cement producers. Source: Company reports.
What’s more interesting here is how all of these companies are growing their sales at over 15% in a market where cement sales volumes appear to have fallen by 1.67% to 2.31Bnt in 2017. CNBM explained that its sale growth arose from improving cement prices in the wake of the government’s supply side changes. It added that national cement production fell by 3.1% to 2.34Bnt. CNBM’s annual results also suggested that the cement production capacity utilisation rate was 63% in 2017.
Anhui Conch’s results were notable for its large number of overseas projects as it followed the state’s ‘One Belt, One Road’ overseas industrial expansion strategy. Projects in Indonesia and Cambodia were finished in 2017 with production set for 2018. Further plants are in various states of development in Laos, Russia and Myanmar. The other point of interest was that Anhui Conch is developing a 50,000t CO2 capture and purification pilot project at its Baimashan cement plant. Given the way the Chinese government has been able to direct the local industry, should it decide to promote CO2 capture at cement plants in the way it has pushed for waste heat recovery units or co-processing, then the results could be enormous.
CRC reported its continued focus on alternative fuels. Municipal waste co-processing projects in Tianyang County, Guangxi and Midu County, Yunnan are under construction and are expected to be completed in the first half of 2018. Construction of its hazardous waste co-processing project in Changjiang, Hainan was completed in February 2018.
As ever with the Chinese cement industry, the worry is what happens once the production overcapacity kicks in. The state–published figures and state-owned cement companies suggest that the industry is in the early stages of coping with this. In February 2018 Reuters reported that the Ministry of Industry and Information Technology (MIIT) had banned new cement production capacity in 2018. The detail here is that new capacity is allowed but that it has to follow specific rules designed to decrease capacity overall. This followed an announcement by the China Cement Association that it would eliminate 393Mt of capacity and shut down 540 cement grinding companies by 2020. The aim here is to hold capacity utilisation rates at 80% and 70% for clinker and cement respectively and to consolidate clinker and cement production within the top ten producers by 70% and 60%. If the utilisation rate from CNBM is accurate then the industry has a way to go yet.
China: Anhui Conch has spent over US$7.9m on a 50,000t CO2 capture and purification pilot project at its Baimashan cement plant in Anhui province. The unit is scheduled to start operation in the first half of 2018. The group has started the project in order to participate in the government’s ‘Intended Nationally Determined Contributions’ CO2 emission reduction initiative.