Displaying items by tag: Closure

Mozambique: Cimentos de Mocambique has closed its Matola plant due to low demand. It made the decision following large losses, according to the O Pais newspaper. The subsidiary of Brazil’s Intercement said that the unit cost US$25m. It operates one integrated plant and four grinding plants in the country with a total production capacity of 2.9Mt/yr.

Botswana: Rachit Josh, the managing director of Matsiloje Portland Cement, say that the company will struggle to reopen without government support to block imports. The cement producer closed its plant at Matsiloje, near Francistown in January 2018, according to the Monitor newspaper. Josh blamed cement imports from South Africa as being a particular concern.

In June 2018 the Ministry of Industry, Trade and Investment said it was starting to introduce restrictions on imports restricting imports to 70% locally sourced product. However, it is unclear when these measures will be implemented.

Matsiloje Portland Cement is a subsidiary of Nortex Group. Its integrated plant had a production capacity of 30,000t/yr. The company produced the lime it used for its cement and it sourced other raw materials from South Africa and fly ash from a power station at Morupule.

India: The Central Pollution Control Board (CPCB) has ordered Malabar Cements plant at Walayar, Palakkad in Kerala to comply with emissions standards or face closure. The cement producer has been given seven days to comply from the 31 December 2018, according to the Times of India newspaper. Malabar Cements was originally granted extra time, to 10 May 2018, to meet the new standards. The CPCB later declared that no cement producer would be able to flout the rules past 31 August 2018. It also intends to fine the company around US$570/day from the end of August 2018 for breaking the standards.

Spain: The Ministry of Industry and two unions have asked Cemex to keep the Gádor cement plant in Almería open. However, the Mexican cement company has rejected the pleas although it has said it will make a ‘definitive’ decision shortly, according to the Expansión newspaper. The company is due to start mandatory consultations with the unions in early November 2018. Cemex announced in mid-October 2018 that it was closing two of its seven cement plants in the country.

Well, it turns out that the European cement industry wasn’t kidding when it raised the risks of the climate mitigation on the sector. This week three (!) integrated plants have been earmarked for closure.

Cementa in Sweden said that it was considering closing its Degerhamn plant due to increased environmental regulations. Today, local press in Spain is reporting that Cemex España is planning to shut down two of its plants. These are plants in different parts of Europe with different local market dynamics but both are within the European Union (EU). That’s three plants closing out of 219 in the EU, or a loss of around 1% of production capacity.

Last week’s column on the United Nations’ (UN) Intergovernmental Panel on Climate Change (IPCC) report on Global Warming raised the way the cement sector is tackling climate change and the existing and impending legislation. President of the German Cement Works Association (VDZ) Christian Knell’s opening words at the VDZ Congress in September 2018 seem prescient. He said, “To be able to realise our efforts in terms of climate protection and at the same time not to lose competitiveness, we need research policy-related support for our investment in breakthrough technologies and the corresponding demonstration projects.” The add-on was that the industry needed to focus on how the development of carbon abatement technologies can meet the 2050 climate goals and, specifically, that suitable boundary conditions would have to be created. The press releases accompanying his speech emphasised that, “on-going trends in European emissions trading and the ‘rapidly increasing’ price of CO₂ were already today leading to considerable costs for cement manufacturers.”

These words are similar to the comments Albert Scheuer, a board member of HeidelbergCement, made at the Innovation in Industrial Carbon Capture Conference early in 2018 about dividing the mounting environmental costs of cement and concrete between producers and society in general. Considering how much cementitious building materials most people use throughout their lives compared to the relative low price of cement, this argument carries some weight. In addition, the sustainability credentials of concrete buildings through longer lifespan and durability through extreme weather events is another argument that industry advocates such as the Portland Cement Association (PCA) in the US have been hawking in recent years.

Cementa, a subsidiary of HeidelbergCement, blamed anticipated tightening of environmental regulations for its decision. Although it said that the plant had made improvements over the years, the expected difficulty (read: cost) to make further improvements was becoming too hard. Shifting production to the company’s other two plants in the region, Slite on Gotland and Brevik in Norway, will reduce CO₂ emissions by 260,000t/yr.

In Spain, the news from Cemex follows a half-year report from Oficemen, the local cement association, that predicted growth for the year but not as fast as previously expected. The problem was that continued declines in the export market, the 13th decline month-by-month in a row, offset the domestic growth. Oficement president Jesús Ortiz also took time to blame rising electricity costs, expected to rise by 20% year-on-year by the end of 2018.

Market issues in Spain aren’t in doubt, but the real question for both Sweden and Spain is whether EU CO₂ legislation right now is causing cement producers to shut plants. The CO₂ emissions allowance price hit a high of Euro22/t in September 2018, the highest price in a decade. Allowances have stayed below Euro10/t since 2011 and the price has more than doubled in 2018. Throw in the mood music of the IPCC and the trend seems irresistible. How many more plants in Europe are at risk to shut next? No doubt the European cement producers have charts marking the viability of their plants against the CO₂ price. This would be a very interesting graph to get our hands on.

The 2nd FutureCem Conference on CO₂ reduction strategies for the cement industry will take place in May 2019 in London, UK

Spain: Cemex España is preparing to close its cement plants at Gádor in Almería and Lloseta in Baleares. It has blamed reduced demand for cement and European regulations on CO₂ emissions for the decision, according to the Cinco Días newspaper. The closures will affect 200 employees and the cement producer is has started to hold union discussions. Cemex will retain integrated plants at Morata de Jalón, Alicante, Alcanar, Castillejo Anover and Buñol.

Sweden: Cementa says it is considering decommissioning clinker and cement production at its 0.3Mt/yr Degerhamn plant due to increased environmental regulations. Production will be shifted to other local plants at Slite on Gotland and Brevik in Norway, and the site retained as a port terminal.

The subsidiary of Germany’s HeidelbergCement said that although the unit had made several investments over the years to reduce its environmental impact its production equipment was difficult to adapt to future requirements for lower CO₂ emissions. Concentrating production to the other plants would mean a reduction in CO₂ emissions of 260,000t/yr.

75 employees work at the plant at Degerhamn. Union negotiations will start immediately and upon their conclusion the cement producer will make a final decision about the future of the plant. If decommissioning goes ahead then clinker and cement production will cease in 2019.

Kenya: The Mombasa county government has ordered the closure of a clinker storage plant run by Corrugated Sheets due to the accusation that is has emitted large amounts of dust. Stephen Wambua, the head of the National Environment Management Authority (Nema) in Mombasa said that operations at the Mikindani-based unit had been stopped and would not resume until it was in full compliance with environmental regulations, according to the Business Daily newspaper. The closure followed complaints by local residents.

Wambua said that imported clinker via the Port of Mombasa is stored in a number of premises locally. Dust is emitted during loading and offloading of consignments. Nema is also investigating claims that other companies are storing ‘toxic’ materials in the Jomvu area. In August 2018 the Kenya Star newspaper linked the Corrugated Sheets site to widespread respiratory illness in the local neighbourhood, including some suspected fatalities since clinker storage started in 2010.

Egypt: The Ministry of Public Business Sector has shut down the National Company for Cement due to mounting losses. Hisham Tawfik, the Minister of Public Business, said that the plant’s losses had reached Euro43m in the last year, according to Egypt Today magazine. Its creditors include the Gas Company and the Egyptian Electricity Company.

The company’s registration with the local stock exchange was closed in August 2018. The government is now intending to sell its stocks in the Suez Cement Company and Al-Nahda Company. The company’s assets will then be sold. The minister said that workers aged 50 years or more will receive redundancy and that younger workers will be moved to other cement companies.

The cement producer reported mounting losses in recent years due to higher production costs. Reportedly, the cost of producing one ton of cement was 60% higher than the average comparable cost of its competitors. In addition the company was paying its workers twice the average wage than other state-owned businesses.

Bolivia: Emisa has reported that it will stop cement production at its plant in Oruro to concentrate on cement distribution instead. Its existing mills were built in 1946 and their technology is now outdated. Local workers were offered either jobs in other plants, voluntary retirement or a redundancy package.