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It won't surprise anyone to know that cement sales have fallen in the west African countries that are suffering from the on-going Ebola outbreak. However the scale may yet be instructive for this and other crises that may affect the cement industry in the future. The local data that follows mostly comes from a report by the World Bank published in early October 2014 looking at short and medium term economic impacts, as well as Global Cement research conducted towards the Global Cement Directory 2015.
All three of the principal countries involved – Liberia, Sierra Leone and Guinea – have low gross domestic products (GDP). They do not have cement kilns but they do have grinding plants and cement import infrastructure run by both local and international firms. They also lack readily accessible limestone deposits. In the short term (in 2014) a health crisis is expected to hit manufacturing through transportation and market disruptions stemming from both direct health implications and behavioural responses.
Liberia's cement sales fell by 60% in the third quarter of 2014, a drop the World Bank attributed to causes other than the rainy season. Quarterly cement sales more than tripled in 2013 from around 10,000t to over 25,000t marking the commissioning of a new mill at the Liberia Cement Corporation (HeidelbergCement) grinding plant. Dangote also has an import terminal in the country and is building its own grinding plant. The drop in cement sales since June 2014 has nearly undone all this production growth.
Neighbouring Sierra Leone has seen a steady fall in weekly cement sales since June 2014. Similar to Liberia, it has a HeidelbergCement-run grinding plant with Dangote planning expansion soon. Guinea, which had about a sixth of the notified cases of Ebola in mid-October 2014, has seen its cement imports fall by 50% in the year so far compared to 2013.
Before readers become too depressed though, it should be considered that Nigeria has been declared Ebola free by the World Health Organisation after six weeks with no new cases. It may have been relatively expensive to contain Ebola through public health measures but the alternatives for the regional economies could have been worse. More cases are expected to arrive in Nigeria but the country has shown that Ebola can be stopped.
Immediate cement operators threatened by the epidemic include HeidelbergCement with its five grinding plants in west Africa. How an uncontrolled or high case Ebola epidemic affects Dangote's expansion plans in its 'backyard' will also be hard to predict. West Africa is the obvious place for the Nigerian cement giant to build itself up before it tackles other markets in sub-Saharan Africa that have stronger competition like South Africa's PPC. Take this market stability away and Dangote faces a direct economic threat to its growth beyond the humanitarian horror of the epidemic. What also has implications for the cement industry in Senegal, the second biggest cement producer in the region, where there are two integrated plants.
The World Bank report concludes that Liberia, Sierra Leone and Guinea could lose US$129m in GDP in a low case scenario or up to US$815m in a high case scenario. To give this some context, Sierra Leone's GDP was US$2.7bn in 2013. In a high case situation it could lose US$439m or an amount equivalent to 16% of its GDP in 2013. If and when the fight against Ebola turns, this still leaves a severe economic recession for the survivors in what is already one of the poorest countries in Africa. Cement, one of the indicators of a country's economic and industrial development, is intricately bound up in this.
UltraTech Cement appoints Atul Daga as Chief Financial Officer
22 October 2014India: UltraTech Cement has appointed Atul Daga as Chief Financial Officer of the company in place of KC Birla with effect from 1 December 2014. The decision was made at a board of directors meeting on 18 October 2014. The term of appointment of the managing director OP Puranmalka was extended for a period of one year until 31 March 2016.
Lafarge names director of plant in Toledo
22 October 2014Spain: Lafarge has appointed Maruxa Suarez as director of its Spanish plant in Villaluenga de la Sagra, Toledo. Suarez, who was previously a production director at the plant, will replace Mariano Garcia Hoyos. Suarez started working for Lafarge in 2004 at the environment unit of the company in Madrid. He later joined the management team as process engineer and production director.
Matteo Rozzanigo appointed as new CEO of Italcementi’s FYM
22 October 2014Spain: Matteo Rozzanigo has been appointed as CEO of FYM, Italcementi's Spanish subsidiary. He is tasked with positioning the company in a cement market that is expected to stabilise and recover slowly after a prolonged crisis period. Rozzanigo replaces Mario Domenico Bracci, who held the post for the past three years and will now assume responsibilities for Ciments Maroc.
Rozzanigo holds an Industrial Engineering degree from the Polytechnic University of Milan, Italy and has been with Italcementi for 11 years. In the past five years, he was employed as Italcementi's director for the Near East, effectively managing the operations in Kuwait and Saudi Arabia.
Nepal Environment and Scientific Services accredit Sonapur Cements with low alkaline content
22 October 2014Nepal: Sona Cement has been awarded the 'Proven Low Alkaline Content' accreditation by Nepal Environment and Scientific Services (NESS) NS Accreditation laboratory. According to a statement from Sonapur Cements, the accreditation will make it the first and only Low Alkaline Content Clinker and Ordinary Portland Cement (OPC) cement producer in Nepal.
Sonapur Cements has a plant in Dang, from which it produces different kinds of high grade and low alkaline content cement under the trademarks of Sona, Sonashree, Sonatech and Sonapur Cement.
Skyonic opens commercial-scale carbon capture unit at Capitol Aggregates cement plant
22 October 2014US: Skyonic has opened its first commercial-scale CO2 capture and utilisation facility, at the Capitol Aggregates cement plant in San Antonio, Texas. The US$125m Capitol SkyMine will have a total CO2 mitigation impact of 300,000t/yr, through the direct capture of 75,000t of CO2 and transformation into sodium bicarbonate, bleach and hydrochloric acid. The unit is expected to generate around US$48m/yr in revenue and US$28m/yr in annual earnings.
"The Capitol SkyMine facility is the first step in our vision to mitigate the effects of industrial pollution and close the carbon cycle," said Joe Jones, founder and CEO of Skyonic. The SkyMine process allows up to 90% of CO2 emissions from flue gas to be captured and transformed into solid products that can then be sold.
Italcementi launches upgraded Devnya Cement plant
22 October 2014Bulgaria: Italcementi has launched its upgraded cement plant in Bulgaria, which is operated by its subsidiary, Devnya Cement. The upgrades will allow Italcementi to meet domestic demand and export demand from Eastern Europe.
"The new plant will enable us to respond to demand from the domestic market and from the neighbouring areas in Eastern Europe," said Italcementi Group chief executive officer Carlo Pesenti in a statement.
The revamp of the cement plant, located near the port of Varna in eastern Bulgaria, began in April 2012 and invovled an overall investment of more than Euro160m. Once the current test and commissioning stage has been completed on all the systems, the cement plant will be fully operational in early 2015. The new facility can produce around 4000t/day of clinker and about 1.5Mt/yr of cement.
The completion of the project will allow the group to consolidate its operations in Bulgaria, where it also runs the Vulkan grinding center in Dimitrovgrad, and boost its export capacity thanks to its proximity to the port of Varna West, which gives access to all the countries on the Black Sea and on the eastern part of the Mediterranean Sea.
The Italcementi Group entered the Bulgarian market in 1998 with the acquisition of Devnya Cement, followed in 1999 by the acquisition of Vulkan Cement. In 2013, the Group reported revenue of Euro59m in Bulgaria.
Savannah Cement focuses on East Africa
22 October 2014Kenya: Savannah Cement has confirmed on-going plans to include the East African market as part of its regional integration support project. The regional market development project is based on a commitment to pursue sales opportunities in all East African countries by 2015, according to managing director Ronald Ndegwa. He added that plans to appoint local dealers in Rwanda and Burundi are at an advanced stage.
Savannah Cement has good market performance in the Kenya, Uganda, Tanzania and South Sudan markets. In Tanzania it has expanded its market reach by retaining in-country dealers in Arusha and Mwanza to cover the country's inland cement demand.
"Savannah Cement's overall corporate development is anchored on a regional market coverage strategy and we are glad that we have made good inroads in the respective East African markets," Ndegwa said. "With our current installed production capacity of about 1.5Mt/yr, we are well placed to meet regional demand." The company is also considering doubling its current production capacity to meet demand.
Ndegwa disclosed that Savannah Cement is lining up development projects valued at more than US$300m, including an investment plan to establish a clinker manufacturing facility and to commission its second grinding plant.
Misr Beni Suef Cement to build coal mill
22 October 2014Egypt: Misr Beni Suef Cement has reached an agreement to build a coal mill worth US$27.9m in 12 months.
"The project will be funded through self-financing and loans," said Misr Beni Suef. The company expects the project to be completed by the end of 2015. Egypt is currently struggling with blackouts and the government has cut natural gas supplies to plants, which has prompted cement companies to switch to coal.
Egypt's natural gas production has been declining for years. Production in January 2014 was down by 10% from January 2013, according to the most recent government figures. In September 2014, the Egyptian government began to allow coal imports despite environmental concerns from the high pollution coal emits.
New line for Al Sawfa Cement from ThyssenKrupp
21 October 2014Saudi Arabia: ThyssenKrupp Industrial Solutions has received an order from Al Sawfa Cement Company, Saudi Arabia, to build a complete cement production line. The order is worth around Euro100m and commissioning is planned for 2016. The new 5300/day clinker production plant will be constructed parallel to the existing line in Jabal Farasan, approximately 150km north-east of Jeddah. The existing line, also supplied by ThyssenKrupp Industrial Solutions, has been in operation since 2009.
The main components are a 1700t/hr crushing facility, 40,000t of additive storage, a blending bed, a 390t/hr raw material grinding plant with ball mill and a POLYSIUS SEPOL separator and a 15,000t blending silo for raw meal.
The Polysius kiln line will consist of a five-stage preheater with PREPOL AS-CC, the POLRO rotary kiln and a POLYTRACK cooler with intermediate crusher. Cement grinding will take place in two ball mills with SEPOL high-efficiency separators. The plant will be rounded off with a 6000t cement silo as well as cement packing and loading facilities.
Lothar Jungemann, CEO of the Cement operating unit of the Process Technologies business unit of ThyssenKrupp Industrial Solutions, said, "This follow-up order shows that we are a reliable partner to our customers. With our leading technology and strong service focus, we support cement producers worldwide with their efforts to further expand capacities and increase operating efficiency."