Displaying items by tag: Caribbean

Dominican Republic: Sika has announced the acquisition of fellow construction chemicals producer Vinaldom. This acquisition marks Sika’s first production site in the Dominican Republic and its sixth in the region, according to a press release. The deal aims to improve customer supply and support local production.

Mexico: Cemex reported sales of US$17.4bn in 2023, up by 8% year-on-year from 2022 levels. Meanwhile, the group’s operating earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 20% to US$3.35bn. The producer said that strong product pricing in all markets and slowing costs inflation compounded the positive effects of its growth investment strategy. On a consolidated basis, Cemex’s cement sales volumes fell by 6% to 51.7Mt from 55.1Mt. They rose by 3% in Mexico but fell by 10% in Europe, Middle East, Africa and Asia, by 3% in South and Central America and the Caribbean and by 13% in the US.

Chief executive officer Fernando González said "I am pleased to announce that 2023 is a great year for our company where we delivered not only great results and recovered from the extraordinary inflationary pressures of the last few years, but also continued executing against our ambitious decarbonisation commitments, reducing our CO2 emissions by 4% year-on-year and by 13% since 2020. Despite the significant macro challenges of the last four years, we have proven not only the resilience of our business model but also our ability to pivot and adjust rapidly to changing global conditions. This foundation gives us additional flexibility in capital allocation, where we continue to accelerate investments in our bolt-on growth strategy, initiate a sustainable return programme for shareholders and bolster our capital structure."

The core of the Caribbean cement industry consists of the Dominican Republic (with 5.9Mt/yr in integrated capacity), Cuba (4.7Mt/yr) and Jamaica (3.5Mt/yr). Haiti and Trinidad & Tobago also command small, single integrated plants, while there are numerous grinding plants and cement terminals along the region’s extensive coastlines. The industry has been the subject of new commercial and capital expenditure-related announcements in the past fortnight. Regarding the Caribbean’s cement producers, these developments seem to lack a single clear direction.

Caribbean market leader Cemex revealed that it was considering selling up in the region’s largest market, the Dominican Republic, on 1 September 2023. Bloomberg cited unnamed sources stating that the Mexico-based cement giant hired financial services JPMorgan Chase to explore the possible divestment of local subsidiary Cemex Dominicana. Exactly one year had passed since Cemex completed its sale of Cemex Costa Rica and Cemex El Salvador to Guatemala-based Cementos Progreso for US$329m. Sources clued in on the latest development reportedly expect Cemex Dominicana to command a selling price three times greater than the Central American divestments combined.

Cemex has discussed its scattered disposal of global assets since 2019 as a strategic realignment towards its main markets, in particular those in North America and Europe. On this understanding, the Caribbean straddles an invisible line between Cemex’s strategic core in North America and Central America on its periphery.

Just to the north of the line lies Jamaica. There, Cemex subsidiary Caribbean Cement will expand its Rockfort cement plant by 30% to 1.3Mt/yr through a US$40m upgrade, scheduled for completion in early 2025. Late last week, Caribbean Cement told investors that the upgrade will equip the plant with new equipment, including a new dosing system. The producer expects this to help the Rockfort plant to further increase its alternative fuel (AF) substitution rate. It co-processed 5.6% AF in its kiln during the first half of 2023, more than double its first-half 2022 substitution rate of 2.7%. Caribbean Cement began exporting cement to Turks and Caicos on 16 September 2023, and plans to increase its shipments there and elsewhere. Managing director Yago Castro reassured Jamaicans that Caribbean Cement would also continue to help meet domestic demand.

Currently, Caribbean Cement and fellow Jamaican producer Cement Jamaica compete in the domestic market against imports, including some cement from Dominican Republic-based Domicem. This enters the country via Buying House Cement’s Montego Bay terminal. Montego Bay Cold Storage, an affiliate of Buying House Cement, shared plans for a second, US$8m cement terminal in the city earlier in 2023. The facility is expected to help meet growing demand from residential and hospitality sector construction.

More new production capacity is soon to come online in the form of a 1.23Mt/yr grinding plant in the Dominican Republic. Cemento PANAM will own and operate the plant, while Germany-based Gebr. Pfeiffer will supply a 3750 C-4 vertical roller mill via engineering, procurement and construction contractor CBMI Construction.

In a market where the nearest cement exporter is only a short sail over the horizon, producers have to compete fiercely for their market shares, even at home. Disputes over Caribbean Community member states’ rights to protect domestic cement production have gone as high as the Caribbean Court of Justice. It ended Barbados-based Rock Hard Cement’s hopes of resuming exports to Trinidad & Tobago last year.

The Caribbean’s cement producers will be acutely aware of Cementos Argos’ planned expansion of its north-facing Cartagena, Colombia, cement export facility, hot on the heels of a previous, US$42m expansion. The South American giant says that it is targeting the US, where it anticipates an upcoming construction boom. Caribbean countries present other possible markets for producers like Cementos Argos, yet their cement industries might equally emulate any successes it enjoys in the US. Like Argos in Colombia, Jamaica’s Caribbean Cement is part of a group with an existing presence in the US. Its on-going investments in the Rockfort plant signal a readiness to catch the trade winds rapidly picking up in the Caribbean.

India: Investment research firm Hindenburg Research has accused Adani Group of conducting a 'stock manipulation and accounting fraud scheme' over a period of ‘decades.’ The US-based firm alleged that listed companies belonging to Adani Group are indirectly part-owned by shell entities and funds connected to the Adani family’s private offshore trusts and companies. The listed companies have purportedly paid money into the offshore trusts and companies, which in turn funded the shell entities and funds investing and trading in Adani Group stocks. Hindenburg Research said that four Adani Group listed companies are ‘near the delisting threshold’ under Indian law requiring a minimum 25% non-promoter holding in listed companies.

Bloomberg has reported that Hindenburg Research said that its two-year investigation into Adani Group uncovered a ‘vast labyrinth of offshore shells’ managed by Adani Group chair Gautam Adani’s brother Vinod Adani. It identified 38 such shell entities based in Mauritius, and other entities based in Cyprus, Singapore, the UAE and the Caribbean. It reported that ‘many’ Vinod Adani-controlled entities show ‘no obvious signs of operations.’ Nonetheless, they have collectively ‘moved billions of dollars.’ Hindenburg Research has uncovered evidence of what it called ‘efforts that seem designed to mask the shell entities, including recurrent listings of ‘nonsensical services’ on their websites. Many of these allegedly have no named employees, and were formed on the same days as others. The Securities and Exchange Board of India (SEBI) confirmed that the offshore funds in question are subject to an on-going investigation.

In a statement, Adani Group’s chief financial officer (CFO) Jugeshinder Singh said that Hindenburg Research had not made “any attempt to contact us or verify the factual matrix.” Singh described the allegations “stale, baseless and discredited.”

Hindenburg Research has taken a short position on Adani Group, meaning that it may make money should the price of shares in Adani Group drop.

Separately, Adani Group acquired a 63% stake in Ambuja Cements and a 57% stake in ACC from Switzerland-based Holcim through an offshore special purpose vehicle (SPV) in September 2022.

Hindenburg Research's report on Adani Group, entitled ‘Adani Group: How The World’s 3rd Richest Man Is Pulling The Largest Con In Corporate History’ can be found here.

Colombia: Grupo Argos subsidiary Argos recorded consolidated sales of US$2.57bn in 2021, down by 9.1% year-on-year from US$2.27bn in 2020. It sold 17.1Mt of cement across all regions, up by 16% from 14.6Mt in 2020. In the US, its cement sales rose by 5.7% to 6.1Mt, in Colombia they rose by 23% to 5Mt and in the Caribbean and Central America they rose by 27% to 6Mt. The producer’s earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 34% year-on-year to US$443m from US$406m.

CEO Juan Esteban Calle “I am extremely proud of these achievements, which are the result of a disciplined strategy of expansion, efficiencies and customer-centricity that has been carried out based on a long-term vision of sustainability, growth and profitability, aiming at delivering sustained and increasing value to our shareholders.”

Venezuela: Corporacion Socialista del Cemento plans to begin to export cement to countries in the Caribbean from the beginning of 2022. The El Universal newspaper has reported that the company’s plant is in the process of increasing its production of cement and clinker for the start of exports. In the first 10 months of 2021, it more than doubled its production and more than tripled its sales volumes.

President Pietro Acosta said "We are contributing to the growth of a new free, non-oil, diversified economy.” He added “We will still continue to serve the national market."

Mexico: Cemex’s consolidated sales in the first nine months of 2021 were US$11bn, up by 5% year-on-year from US$9.4bn in the corresponding period of 2020. Its cement sales rose by 10% to 51.1Mt from 46.2Mt, while its ready-mix concrete volumes increased by 7% to 36.8Mm3 from 34Mm3. Its operating earnings before interest, taxation, depreciation and amortisation (EBITDA) totalled US$2.24bn, up by 24% from US$1.81bn. Its gross profit was US$3.63bn, up by 18% from US$3.07bn. During the period, the group reduced its debt by 33% to US$8.98bn from US$13.3bn.

Cement volumes grew in all regions in every quarter of the year except the third, when they fell by 3% in Mexico and remained level year-on-year in Europe, the Middle East, Africa and Asia. The quarter brought an end to five consecutive quarters of double-digit year-on-year growth in bagged cement sales in Mexico. Mexican bulk cement sales meanwhile ‘accelerated in line with the formal sector recovery.’ The sharpest nine-month cement volumes growth was in South, Central America and the Caribbean, where sales rose by 19% year-on-year, followed by Mexico, with a rise of 12%.

CEO Fernando González said “We are pleased to report strong top-line growth, reflecting continued growth in demand for our products, coupled with an acceleration in pricing momentum. We are confident that our pricing strategy will more than compensate for the sudden runup in input cost inflation we have experienced.” He added “We remain optimistic regarding outlook, as most of our markets are operating at high capacity utilisation and sustainable midcycle levels that will be supported by monetary and fiscal stimulus, while others are just beginning an upcycle. Regarding our Future in Action initiative, we continue to advance on our climate action goals. During the quarter, we received validation from SBTi of our 2030 decarbonisation roadmap and joined the Race to Zero initiative. Our climate action agenda is a fundamental element of our medium-term strategy not only because it creates value for stakeholders, but because it is the right thing to do for future generations.”

Caribbean: Sweden-based Bruks Siwertell has won a new contract to deliver a Siwertell enclosed screw-type ship loader for cement and clinker. It will serve a new cement plant being built by an unnamed end user in the Caribbean. The type-1B ship loader will deliver cement and clinker handling at a continuous rated capacity of 600t/hr, with a peak loading rate of 750t/hr, for vessels up to 20,000dwt. It will be delivered in 2021 and is scheduled to be operational later in the year.

“This is our first Siwertell loader installation in this particular region and it will have to work in one of the most earthquake-prone zones of the world,” said Axel Dahl, Sales Manager, Bruks Siwertell. “The cement industry in the area is currently undergoing some of its most advanced improvements in decades, and as part of this, environmental protection is very much under the magnifying glass.

Colombia: Switzerland-based construction materials producer Sika has invested an undisclosed sum in relocating production from a concrete admixture and mortar plant in Colombia to a larger facility in Barranquilla. Sika Americas regional manager Christopher Ganz said, “Our latest investment in Barranquilla will help us capture the potential of the dynamic construction market in the Caribbean region. Our aim is to grow more quickly than the construction market in this region.” The market grew by 15% in 2019.

Sika also manufactures building products for the Colombian market at facilities in Bogotá, Medellín and Duitama.