Displaying items by tag: China
Guangdong Tapai orders two coals mills from Loesche
17 October 2018China: Guangdong Tapai has ordered two coal mills from Germany’s Loesche for its two 10,000t/day clinker production lines in Jiaoling, Meizhou in Guangdong. This is a repeat order, following an order for two LM 35.3 D coal mills that was made in 2015. The 3-roller mill grinds 50t/hr of pulverised coal to a fineness of 3% with a sieving residue of 0.08 mm. The installed power is 1200kW. The order has been placed through Loesche Shanghai and the two newly ordered coal mills are expected to be delivered in April 2019.
Jianghua Conch starts solar plant project
11 October 2018China: Jianghua Conch has launched a 5.9MW solar plant project. Its subsidiary, Jianghua Conch New Energy, will build the unit. No date for the completion of the project has been disclosed. Jianghua Conch is a subsidiary of Anhui Conch based in Hunan province.
China: Anhui Conch has signed a cement sale and purchase agreement with Jiangsu Conch Building Materials with a value of up to around US$230m. Subsidiaries of Anhui Conch based in east China will sell a total of 3.5Mt of cement products to Jiangsu Conch, a non-wholly owned subsidiary of Anhui Conch. The contract will last until the end of 2018.
The agreement has been setup for a relatively short time period as a pilot scheme to test the market. The intention is to allow the direct Anhui Conch subsidiaries to focus on production and to enable Jiangsu Conch to concentrate on using its ‘centralised sales advantage.’
China: Lubao Cement has ordered three vertical roller mills from Germany’s Loesche for a new 4500t/day plant that is being built at Bei Liu in Guang Xi. The project is being handled by Sinoma (Suzhou) Construction, part of Sinoma International Engineering and China National Building Material Group (CNBM) in turn.
Loesche is supplying three mills for the project, one each for raw material, coal and clinker/slag. One four-roller mill with a capacity of 450t/hr will be used for grinding cement raw material to a fineness of 12% with a sieving residue of R 80μm. Another mill with a throughput of 200t/hr will be used for the subsequent grinding of cement clinker to a fineness of 3400 - 3600 Blaine. A large three-roller mill with a capacity of 42t/hr will be used for grinding fuel coal to a fineness of 2% and a sieving residue of R 80μm.
No value for the order has been disclosed.
US commences tariffs on Chinese cement products
19 September 2018US/China: The Office of the US Trade Representative has started implementing a 10% tariff on mineral and other products from China, including cement, following a consultation period. Mineral products affected by the proposed tariffs of interest to the cement industry include limestone flux, quicklime, slaked lime, gypsum, anhydrite, clinkers of Portland, aluminous, slag, supersulphate and similar hydraulic cements, white Portland cement, Portland cement, aluminous cement, slag cement, refractory cements, additives for cement, cement based building materials and more.
The latest tariff list follows an earlier decision by the US government to tax imports from China worth US$34bn that came into force in early July 2018.
Wu Xu appointed chairman of Taiyuan Lionhead Cement
05 September 2018China: Wu Xu has been appointed as the chairman of Taiyuan Lionhead Cement. The 54-year old Chinese national is a graduate from the Chongqing Construction Workers College, he holds a master's degree in business administration from Chongqing University and he has attended the China Europe International Business School. From 1982 to 1991 Xu was the chief engineer of Chongqing Building Management Station and was the executive vice general manager of China Chongqing International for Economy & Technology Cooperation in the early 1990s. In 1994 he founded Sincere Group and has since been its chairman and president.
Largest Nepalese plant secures US$140m commercial loan
05 September 2018Nepal: A consortium of Nepal’s five commercial banks has approved credit worth US$140.5m to Hongshi Shivam Cement Private Limited, a Nepal-China joint venture company, in one of the largest ever finance pledges by Nepali commercial banks to any industry or infrastructure project. Company officials said that they would use the loan pledged by the commercial banks to start commercial production of cement at Hongshi Shivam’s 6000t/day plant.
The consortium led by Nepal’s NMB Bank, co-led by Nepal Investment Bank and participated in by Prabhu Bank, Everest Bank and Nepal SBI Bank, pledged the loan to the cement company, which has been conducting trial production of cement since May 2018.
The joint venture said that the loan was sought from Nepali banks to conclude financial closure of the cement plant. It has already received approval to inject Foreign Direct Investment (FDI) worth US$86m from Investment Board of Nepal and the central bank. The Chinese joint-venture partner has pledged to inject total FDI of US$360m, making it the largest FDI ever in the country’s cement industry.
CNBM marks its place as the world’s largest cement producer
29 August 2018The world’s largest cement producer China National Building Material (CNBM) released its half-year results this week and the figures were generally good. Despite falling production, the state-owned company has managed to raise its prices year-on-year to generate significant sales revenue and earnings increases. As usual the level of detail was fairly light, although not much lighter than some non-Chinese producers on the international market. The key point was that cement production fell by 5% year-on-year to 143Mt. This was due to poor demand, mounting environmental regulations and rising input costs.
The half-year report was significant because it is the first financial report from the company since its merger with China National Materials (Sinoma) completed in early May 2018. Just like the reports of LafargeHolcim and HeidelbergCement following mergers or acquisitions, CNBM has seen a boost to its performance. Further gains from scale and synergy are expected. The union has indisputably created the world’s biggest cement producer, putting aside any European or American cries of over-calculation of production capacity on the part of their Chinese rivals. However, size comes with particular problems.
Placed in a wider context CNBM and its owners, the Chinese government, are attempting to manage a wind-down from the biggest construction boom in human history. National Bureau of Statistics data show that sales of cement fell by 10% to 984Mt in the first half of 2018 from 1.1Bnt in the same period in 2017. So, falling cement production volumes are not a surprise. What is curious, though, is how cement prices have appeared to rise in a country with massive production overcapacity. Each of CNBM’s cement producing subsidiaries reported that its average selling price of cement grew year-on-year.
Graph 1: Sales of cement in China, 2014 – 2018. Source: National Bureau of Statistics of China.
Regional variation could explain some of this in a country as large as China and similar trends can be observed in India with its own diverse internal markets. The local focus on environmental regulations offers another explanation. In June 2018 the government’s State Council issued regulations to reduce the production capacity of construction materials, set up emission limits for pollution, implement peak shifting of production and to establish a ‘strict’ accountability mechanism for all of this. CNBM has followed these directives with its ‘Price – Cost – Profit’ (PCP) strategy and all of its subsidiaries have conformed to this. What is not covered in the report is whether there is a negative financial effect of peak shifting and other environmental regulations and how bad this is.
It’s easy to dismiss the performance of a state-controlled company but the enlarged CNBM is facing a unique set of challenges. It appears to be off to a great start but both its scale and its challenges are unprecedented. In its outlook for the second half of 2018 it said that the, “contradiction of overcapacity in the industry has not been changed fundamentally.” This suggests that, although cement prices and profits have held up so far, there is no guarantee that this situation will continue.
CNBM’s cement production drops due to poor demand and environmental regulations in first half of 2018
28 August 2018China: China National Building Material’s (CNBM) cement production volume fell by 5% year-on-year to 143Mt in the first half of 2018 from 150Mt in the same period in 2017. It has attributed this decrease to ‘flat’ demand, increased pressure on environmental protection and rising costs of fuel and raw materials. As part of its ‘Price – Cost – Profit’ (PCP) initiative the group has focused on reducing production capacity and output, implementing peak shifting production and eliminating old production facilities.
Despite the headwinds, the group’s sales revenue from its cement division rose by 22% to US$7.41bn from US$6.06bn. Its adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) increased by 38% to US$2.08bn from US$1.51bn. Average cement prices also rose year-on-year. External sales from its engineering companies increased by 13% to US$2.18bn from US$1.92bn. Overall, group sales revenue rose by 22% to US$14bn from US$11.5bn.
CNBM completed its merger with China National Materials Company (Sinoma) on 2 May 2018. Its cement producing subsidiaries include China Untied, South Cement, North Cement, Southwest Cement, Sinoma Cement, Tianshan Cement, Ningxia Building Materials and Qilianshan. Its engineering subsidiaries include Sinoma International, China Triumph and Sinoma Milling.
China: Huaxin Cement’s sales rose by 27% year-on-year to US$1.75bn in the first half of 2018 from US$1.38bn in the same period in 2017. Its net profit nearly tripled to US$304m from US$107m. Its cement and clinker sales volumes grew by 1.13% to 32.2Mt.
The cement producer said that it had been challenged by raw materials and fuel price rises and kiln suspensions due to government-mandated peak shifting production during the reporting period. However, measures such as higher alternative fuels co-processing rates and efficiency gains helped to bolster its financial performance. Its kiln waste processing volumes increased by 18.4% to 0.68Mt.
The company added that its Tibet Shannan 3rd Phase 3000t/day clinker production line was ‘proceeding smoothly’ and was scheduled to start operation by the end of August 2018. Its 4000t/day Yunnan Luquan clinker line and 2.85Mt/yr Huangshi clinker replacement line projects have started construction. In Nepal a 2800t/day clinker line is scheduled to start construction by the end of the year. It is also working on municipal solid waste (MSW) projects in Wuhan Changshankou and Lijiang.