Displaying items by tag: China
China: China Resources has reported that its net profit rose by 80.4% year-on-year to US$148m for the first half of 2013. The major Chinese cement producer's revenue rose by 16.5% to US$1.66bn. Gross profit rose by 29% to US$383m.
China Resources expects that its cement production capacity will reach 76.5Mt/yr by the end of 2013. Clinker production capacity is expected to reach 51.8Mt/yr.
China prepares to cut cement capacity as output rises by 9.7% to 1.1Bt in first half of 2013
31 July 2013China: China produced 1.1Bt in the first half of 2013, a year-on-year increase of 9.7%, according to the latest statistics released by the National Development and Reform Commission (NDRC). The cement inventory of the country's major cement producers increased by 0.3% year-on-year to 27.76Mt. Profit for the cement industry remained flat with a 1% increase year-on-year to US$2.49bn.
Meanwhile the government is considering a detailed plan to eliminate outdated industrial production capacity, according to the China Securities Journal. The plan is expected to eliminate outdated capacity in the cement, steel, electrolytic aluminum, plate glass and shipbuilding sectors.
Zhu Hongren, chief engineer of the Ministry of Industry and Information Technology (MIIT), confirmed that MIIT and the NDRC are currently working on the plan. The plan will boost the sectors' utilisation of existing capacity by setting industry access standards and eliminating outdated capacity. To ease overcapacity in affected industries, MIIT ordered in late July 2013 around 1400 companies in 19 sectors to eliminate outdated production capacity by September 2013 and eliminate excess capacity by the end of 2013.
Cemex Latam sales up by 8% in Q2 2013
24 July 2013Colombia: Cemex Latam has reported that its consolidated net sales rose year-on-year by 8% to US$431m in the second quarter of 2013. The Cemex subsidiary, based in Colombia, Panama, Costa Rica, Nicaragua, El Salvador, Guatemala and Brazil, attributed the rise to higher volumes, driven by improved construction activity and higher prices. Cemex Latam's operating earnings before interest, taxes, depreciation and amortisation (EBITDA) increased year-on-year by 16% to US$166m
"We are very pleased with the favourable results in the second quarter, as evidenced by the record level of operating EBITDA margin that reached 38.5%. We are also very encouraged with the results seen so far in connection with our new strategy based on commercial solutions that are allowing us to capture incremental value," said Carlos Jacks, CEO of Cemex Latam.
By region, Cemex Latam's operating EBITDA in Colombia increased by 12% to US$103m in the second quarter of 2013 and net sales increased by 6% to US$238m. In Panama, operating EBITDA increased by 14% to US$40m and net sales increased by 8% to US$81m. In Costa Rica, operating EBITDA increased by 37% to US$19m and net sales increased by 28% to US$42m. In Cemex Latam's remaining territories operating EBITDA increased by 7% to US$21m and net sales were US$74m.
China's cement output rises 9.7% in H1
17 July 2013China: China's cement output has increased by 9.7% year-on-year to 1.1Bt for the first half of 2013, according to the data released by the National Bureau of Statistics (NBS). In June 2013 cement output increased by 8.8% year-on-year to 228Mt.
Zimbabwe: The Sino-Zimbabwe Cement Company has commenced its first phase of upgrading and refurbishing its Gweru factory. Work on the cement mill and rotary kiln is set to increase the clinker production capacity up to 0.2Mt/yr by the end of 2013. A second phase, also due for completion in 2013, will upgrade warehousing and storage facilities. Further upgrade work is planned for 2014.
"We are upgrading the capacity and efficiency of our cement mill so as to meet growing local and regional demand. The cement mill will be modernised with third generation technology that will immensely improve our efficiency and quality of product. This technology is also the first of its kind in Zimbabwe," said the company in a statement.
The Sino-Zimbabwe Cement Company is the product of a joint business venture between a Chinese foreign direct investment partner, China Building Material Industrial Corporation for Foreign Econo-Technical Co-operation (CBMC), and the Industrial Development Corporation of Zimbabwe Limited. CBMC contributed 65% of the original funding in the form of modern technology and expertise while IDC provided land, civil works, manpower and local knowledge. The cement plant has been in operation since 2001.
China outlines merger targets for cement sector
02 July 2013China: The China Cement Association (CCA) has drafted a plan to promote mergers and acquisitions in the cement industry, according to an 'industry insider' quoted by Xinhua's China Economic Information Service. The plan is to help the cement industry to eliminate its out-dated production capacity and increase the concentration ratio of the industry.
According to the plan, the number of cement enterprises in the country will witness a significant drop during the 12th Five-Year Plan period (2011-2015) from that in seen in 2010, with no more than 1000 cement clinker enterprises and no more than 2000 large-scale cement grinding stations, each with annual output of more than 600,000t/yr, left by the end of 2015.
The plan also aims to develop five enterprise groups that each have annual output of more than 100Mt/yr and have a complete industry chain, core competence and international influence.
Sinoma subsidiary to acquire Wuhai Xishui Cement
26 June 2013China: Sinoma has announced that its subsidiary Ningxia Building Materials has agreed to acquire a 55% equity interest in Wuhai Xishui Cement held by Xishui Strong Year for a cash consideration of US$43m. Wuhai Xishui Cement is currently owned by Ningxia Building Materials (45%) and Xishui Strong Year (55%).
Building a better Lafarge
19 June 2013Lafarge's decision to expand in Zimbabwe adds to the mix in sub-Saharan Africa.
As we discussed in Global Cement Weekly #104, Dangote and PPC (formerly Pretoria Portland Cement) may be facing off as the biggest local cement producers in the region but the influence of the European-based producers should not be dismissed too readily. Investing US$200m over the next 10 years matches PPC's similarly sized investment announced in November 2012. According to Lafarge, the spend will help maintain the cement producer's market share in the country.
The other point of note from Lafarge's Zimbabwe announcement is the emphasis on the multinational's 'Building Better Cities' campaign in the story. This is unsurprising given that that Lafarge Zimbabwe Managing Director Jonathan Shoniwa made the comments about Lafarge Zimbabwe at a branding event for the campaign. Similar events are happening around the world. However, looked at overall, the decision to place cities at the heart of its marketing makes an increasingly compelling case for a variety of markets.
Some commenters on the Global Cement LinkedIn Group discussed this very issue recently in response to a news story on Lafarge's next set of expansion plans for China. Specifically, someone asked why would Lafarge want to expand in a market suffering from overcapacity!
The Building Better Cities campaign offers one answer. As China prepares to shut down excess capacity, Lafarge's strategy to be in place once the dust settles (perhaps literally in some places) starts to make sense. As a marketing tagline 'building better cities' works well because who doesn't – from Zimbabwe to China to even France – want better cities with better transport links through price, planning, technical and aesthetic innovations.
To give a sense of the environmental zeitgeist happening in China right now, this week we carry a news story on the Chinese Institute of Public and Environmental Affairs reporting 17 Chinese cement companies for environmental misdemeanours. Elsewhere, we can see evidence of continued foreign enthusiasm for investment in the Chinese cement market from Japan's Sumitomo Osaka Cement, despite fears of overcapacity. Lafarge is saying the right things at the right time but it may not be alone in its strategy.
China: 17 cement companies have been found to regularly violate environmental protection laws by illegally discharging airborne pollutants, according to a report led by the Institute of Public and Environmental Affairs (IPEA). The report, conducted by the IPEA with several independent institutes and environmental non-government agencies (NGO), also accused the companies of failing to disclose environmental information as required.
The 17 cement companies have about 170 recorded environmental violations between them. Violations listed in the records include the lack of denitrification facilities, faulty monitoring appliances and excessive emissions.
"The State Council recently released 10 measures to control airborne pollution and achieve energy and emissions reductions. The extremely energy-intensive cement, steel and thermal energy production industries, especially those leading listed companies, need to share the heavy responsibility of reducing emissions and not disappoint the public," said Ma Jun, director of the IPEA.
The cement industry is among the six most heavily polluting industries that were required by the Environmental Protection Ministry to meet international emission limits from March 2013. Dust emissions from the cement industry accounted for about 30% of total industrial emissions in 2009.
"We found that this industry has shocking problems with dust and waste gas emissions. The cement industry's violations have deeply harmed the living environment and health of those who live near the factories," said Fang Yingjun from environmental NGO Green Jiangnan.
The environmental NGOs said that they have contacted the 17 listed companies to inform them of the aforementioned pollution problems, but most of the alleged offenders took an evasive stance.
Sumitomo Osaka Cement ups cement production in China
19 June 2013China: Sumitomo Osaka Cement intends to increase cement production by 80% in China's Yunnan Province by 2016. The Japanese cement producer has been making cement in Yunnan Province since 2007 in partnership with a local steelmaker and a Hong Kong construction materials company. That operation involves four plants, each run by a separate joint-venture firm.
With infrastructure investment still active in Yunnan, the plan is to build two more cement plants with a combined production capacity of 6.4Mt/yr. This will make the operation the province's largest, with a capacity of 14.6Mt/yr.
The first new plant will be built in December 2014 and the second in 2016. Sumitomo Osaka Cement will invest around US$42m for its share of the project.