Displaying items by tag: Forecast

India: Birla Corporation says that it expects to sell 18.1Mt of cement during the 2024 financial year (1 April 2023 - 31 March 2024), up by 15% year-on-year from 15.7Mt in the 2023 financial year. That financial year, sales grew by 11% year-on-year. Looking ahead, the producer expects its new 3.9Mt/yr Mukutban cement plant in Maharashtra increase its sales. It said that it may also carry out future expansions at its Chanderia cement plant in Rajasthan.

The Hindu BusinessLine newspaper has reported that managing director and CEO Sandip Ghose said "Our strategy is based on prices not going up significantly. Volumes are going to move in a healthy manner unless there are any major dislocations, disruptions or hiccups going forward. I am very bullish on the India growth story." Regarding the company's Gujarat market in Western India, he said "Gujarat had gone through exponential growth in the past year, which boosted certain companies' profitability because of the bullet train, the expressway and other developments." Ghose forecast similar demand growth in Madhya Pradesh and Uttar Pradesh.

World: Market Research Future has forecast a composite annual growth rate (CAGR) of 5.3% between 2022 and 2030. This would result in a market value of US$505bn in 2030, compared with US$335bn in 2022. The report added that the rate of new construction projects is increasing across all regions.

Peru: Unacem recorded consolidated sales of US$380m during the first quarter of 2023, corresponding to year-on-year growth of 2.6%. Despite this, the producer's earnings before interest, taxation, depreciation and amortisation (EBITDA) fell by 7.4% to US$105m. Unacem attributed its sales growth to 'strong' cement sales volumes in the US, as well as increased prices across its markets. The domestic Peruvian market contributed US$247m (65%) of Unacem's sales, up by 0.5% year-on-year. Peruvian cement volumes fell by 8%, while high fuel costs there contributed to a local decline in earnings.

Looking ahead to the full 2023 financial year, Unacem CEO Pedro Lerner expects the group's consolidated sales to rise year-on-year. He forecast a 10% drop in Peruvian cement volumes to 6Mt. Lerner said that the company is 'monitoring events' in neighbouring Ecuador, but considers it inevitable that on-going political disturbances will 'affect economic conditions' in the market.

Vietnam: The Vietnam National Cement Association (VNCA) expects members to record a 13% drop in their gross profit in 2023 due to a 3% rise in electricity prices. At the same time, it expects cement demand to fall due to the slowing of residential construction activity. During the first quarter of 2023, Vietnamese cement exports to China fell by 90% in value terms.

Việt Nam News has reported that electricity costs constitute 15% of operating expenses for the Vietnamese cement sector.

India: India Ratings & Research forecasts that cement demand will grow by up to 9% in the 2024 financial year that started in April 2023, due to continued government infrastructure spending. Despite mounting inflation and a large number of capital expenditure projects in progress, it expects cement company profits to recover due to slowing increases in energy costs, according to the Press Trust of India. The current prediction for the 2024 financial year follows a growth estimate of 9% in the 2023 financial year.

The credit ratings agency warned that sector expansion projects will hold back cement production capacity utilisation rate below 70% in the 2024 financial year compared to 65% in the 2023 financial year. It forecasts that three-quarters of around 150Mt/yr of new production capacity is likely to be commissioned by the end of the 2025 financial year. However, as most of this new capacity will be grinding plants, the clinker utilisation rate is likely to remain high.

It added that it expects to see more industry merger and acquisition activity in the south of the country in the short-to-medium term.

New Zealand: Cement producer and construction firm Fletcher Building has reported a 20% year-on-year drop in domestic housing demand during the first quarter of 2023. The Australian newspaper has reported that the company attributed the decline to ‘soaring’ interest rates in the country. It now expects to sell 800 residential units in 2023, 20% below its previous expectation of 1000 units. Fletcher Building said that building materials costs rose by 5 – 10% between 2020 and 2022, due to ‘higher input and commodity costs’ in production.

CEO Ross Taylor said that Fletcher Building faces labour shortages in its civil construction business, but maintained a strong order pipeline. Taylor said “It won’t drive an uptick in volumes but it will underpin the volumes in the next three to four years.”

India: Credit rating agency Crisil expects the Indian cement sector's capacity to expand at a compound annual growth rate (CAGR) of 4 - 5% over the four-year period up to the end of the 2027 financial year on 31 March 2027. It would thus begin the 2028 financial year at 715 - 725Mt/yr in installed capacity, compared to 570Mt/yr at the end of the 2023 financial year. The industry's total investment in the expansion is expected to be US$14.5bn. Major multi-state producers are expected to contribute over US$7.25bn (50%) of investments towards the total sum.

Over the same period, Crisil expects all-India cement demand to rise at a CAGR of 6 - 7%.

Denmark: FLSmidth's cement business recorded 29% year-on-year sales growth to US$2.14bn in 2022, from US$1.66bn in 2021. The business' earnings before interest, taxation and amortisation (EBITA) totaled US$28.9m, compared to negative earnings of US$2.7m in 2021. During the year, its Americas region contributed 34% of sales, its Europe, North Africa and Russia region (subsequently Europe and North Africa) 26%, its Sub-Saharan Africa, Middle East and South Asia region 25% and its Asia-Pacific region 15%. Overall, FLSmidth's sales rose by 24%, while its EBITA fell by 8%, year-on-year.

The supplier said "Overall, our cement service showed strong performance throughout the year. In some countries, we did however start to see the first cases of budget constraints imposed to counter the increasing energy costs."

Looking forward to 2023's anticipated result, it noted a 'healthy' order pipeline, but an anticipated slow-down in producers' decision making. This is due to concerns related to energy volatility continuing the wake of the outbreak of war in Ukraine. FLSmidth concluded "The short-term outlook for the cement industry remains impacted by overcapacity, and the potential recession is expected to impact market demand negatively over the coming period."

India: The price of imported coal ended December 2022 at US$145/t. The figure represented a 15% month-on-month drop from November 2022 levels. HT Media News has reported that the price is the lowest since the Russian invasion of Ukraine in February 2022.

Finance company IDBI Capital has forecast that earnings before interest, taxation and amortisation (EBITA) per tonne of cement by local cement producers will rise by US$2.66/t quarter on quarter during the fourth quarter of the 2023 financial year, which will end on 31 March 2023. This is partly due to an anticipated 10% year-on-year decline in coal and petcoke costs during the period, alongside a 10% rise in cement volumes projected over the same period.

Italy: Buzzi Unicem recorded consolidated sales of Euro4bn in 2022, up by 16% year-on-year from 2021 levels. The producer's earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 22% year-on-year to Euro288m. The earnings figure is 33% higher than Buzzi Unicem's previous full-year 2022 EBITDA forecast of Euro216m.

Buzzi Unicem said that group cement sales fell by 9.2% to 28.3Mt, and volumes contracted in Italy, Eastern Europe and the US. The producer noted logistical issues disrupting sales in the US.