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At today's official launch of LafargeHolcim, CEO Eric Olsen was asked to comment on the group's position in Iran. It doesn't have one, but that won't necessarily always be the case given events in Austria this week.

On Tuesday 14 July 2015, Iran and the P5+1 countries (US, UK, France, China, Russia and Germany) agreed an historic deal to limit Iranian nuclear activity in return for a significant lifting of existing trade sanctions at a meeting in Vienna. The country's cement industry will be delighted by this agreement. The talks, in progress since 2006, could mark what has been termed a 'new chapter' in relations between Iran and the rest of the world by Iranian President Hassan Rouhani. For his part, US President Barack Obama stated that the deal would ensure that 'every pathway to a nuclear weapon is cut off' for Iran, but critics from the US, Iran, Israel and elsewhere, suggest that cutting all routes will not be possible. They are alarmed and have warned that the deal could lead to an arms race between Iran and Saudi Arabia, amid increasing animosity in the Middle East.

While the geopolitical implications of the deal are huge, the lifting of trade restrictions will greatly improve Iran's ability to deal internationally. This includes allowing increased oil exports. An article by Reuters anticipates that Iranian oil production could increase drastically from around 1 million barrels per day (mbpd) at present, possibly to its former peak of 3mbpd. (What this might do to the global oil price could be the subject of an entirely separate column). The easing of banking restrictions will make Iranian products more competitive and increase trade in many sectors.

Against this backdrop sits the Iranian cement industry, the world's third or fourth largest by production in 2014, depending on your source. It has an incredible 84.4Mt/yr of cement production capacity in a country of 77.5 million people. Assuming that it could produce and consume all of that cement at home, this would represent consumption of around 1100kg/capita/yr, far above the 600-800kg/capita/yr rate that is typical of a rapidly-developing economy.

Of course, Iran has not been consuming anything like this level of cement recently. According to figures released by its Employers Guild Association this week, Iran made 66.4Mt of cement in its 1393 calendar year, which ended on 21 March 2015. Assuming the above capacity, this gives Iran a cement utilisation capacity of around 78%.

Much of the cement made in Iran was exported in 2014 and so far in 2015. The country exported an incredible 18.4Mt/yr of cement and clinker in the year to 21 March 2015, up from 18.8Mt a year earlier. A large amount of this cement was available at low cost, to the extent that Iran has been accused (along with Pakistan) of dumping cement in the Middle East and East Africa. (Pakistani producers have even pointed out that Iranian cement is making inroads into the Afghan market, more traditionally a target for exports from Pakistan).

So what might happen to the cement trade dynamic in the region? Some suggest that the easing of sanctions can only increase the potential for Iranian cement imports in the region. Trade should become easier, facilitating exports.

Indeed, this is a factor, but it is only part of the equation. Instead, it is likely that, having earned foreign exchange via increased oil sales, Iran will be able to spend more at home. Reuters anticipates that demand for steel and cement will skyrocket as the country undertakes much-needed construction and infrastructure works. This situation would be similar to Saudi Arabia and other Gulf Cooperation Council (GCC) states. How Saudi Arabia reacts to this, both politically and in terms of cement trade, will be of high interest in the region and around the world.

Instead of increasing cement exports, the effect of the lifting of sanctions may decrease them. This will surely be welcome news to local producers currently being undercut in East Africa, as well as exporters in Pakistan, India and elsewhere. Could Pakistan even find itself exporting to Iran? If a US-Iran nuclear deal is possible, anything can happen...

Russia: Eurocement Group has launched a 1.3Mt/yr dry-process cement plant in the Ulyanovsk Region's town of Sengiley. The plant will produce cement using a dry process at an investment cost of US$282m. Local press stated that the plant will create about 500 direct jobs and 1000 further indirect jobs.

Europe: On 15 July 2015 LafargeHolcim officially launched the new group around the world and announced key elements of its ambitions for the future. Following the successful completion of the merger between Lafarge and Holcim and the listing of the new LafargeHolcim shares in Zurich and Paris, the new group will now work towards its target of creating the highest performing company in the building materials industry.

LafargeHolcim CEO Eric Olsen said, "Now as LafargeHolcim, we will step into the next phase of our transformation to become the leader in every respect – a company that has a positive impact on the world and can make a real difference for its customers, its employees, its shareholders and society."

The company is initiating a strategic transformation by building on the best of both Lafarge and Holcim. LafargeHolcim will now focus on five areas in its first integration phase:

• Synergies: Delivering on a Euro1.4bn synergy target within three years;

• Capital allocation: Adopting a rigorous approach to capital allocation and overall reduction of capital spending;

• Commercial transformation: Creating differentiation through innovative products and solutions;

• Integration: Creating one new group and culture;

• Health and safety: Putting health and safety at the centre of the organisation.

LafargeHolcim says that it will be organised along a new operating model oriented to serve its local customers, while leveraging the group's size, footprint, and capabilities at global scale. It added that this 'combines empowered countries, regional management platforms and expertise-driven group functions.'

The group added that it will present separate results for Lafarge and Holcim results for the first half of 2015. The first LafargeHolcim results will be presented for the first nine months of 2015.

In its official launch in Zurich, LafargeHolcim's CEO Eric Olsen said, with over 115,000 colleagues in 90 countries, LafargeHolcim was now the clear leader in the building materials sector. He highlighted that the company was present in 'all relevant markets' and was not looking for significant capital-intensive growth. Despite economic hardship in various markets, LafargeHolcim expects 'reduced volatility due to a very balanced global portfolio.'

Olsen said that LafargeHolcim would be able to 'thrive in a low-investment environment,' adding that the group would be 'very selective in persuit of growth.' When asked if there would be further divestments, Olsen stated that there were no plans to divest further assets at present, beyond the assets to be sold as part of the merger.

Olsen also acknowledged that there would be redundancies in some countries where Lafarge and Holcim were both previously present, giving the US as an example. No specific headcount changes were announced.

Olsen outlined a timeline of targets for LafargeHolcim. In the first 100 days the company will begin to enact its action plans for its five key areas. A strategic roadmap will be presented before the close of 2015. Within the first 300 days the new organisational structure will be in place and all transactions pertaining to the merger will be complete. At this stage the company will also be able to see 'tangible results' from its synergies plan.

Within 500 days Olsen said that the integration would be complete and LafargeHolcim would be operating 'beyond the integration phase.' By 1000 days the company expects to have achieved the whole of its Euro1.4bn synergy targets.

Europe: Following the successful completion of the merger between Holcim and Lafarge, LafargeHolcim has today started trading on the SIX Swiss Exchange in Zurich with the ticker symbol LHN and on Euronext in Paris, joining the Swiss Market Index (SMI) and the CAC 40 index (replacing Lafarge SA) respectively. LafargeHolcm had a total market capitalisation of around Euro39.4bn on 13 July 2015. Representatives of LafargeHolcim's senior management will attend the start of trading ceremony in Paris.

Dominican Republic: According to Esmerk Latin American News, Cemex Dominicana plans to invest US$5.96m to expand the packaging and palletising capacity at its plant in San Pedro de Macoris. The investment includes a new cement packaging line that will increase its capacity by an additional 1.5m bags per month, reaching a capacity of 2.4Mt/yr. Cemex also intends to expand its cement milling capacity over the next few months and build a new facility for cement loading.

Kazakhstan: According to Dow Jones, Steppe Cement said that it sold more cement, but at a lower price, in the first half of 2015 due to the unfavourable exchange rate between the Kazakhstan Tenge and the Russian Ruble. The company sold 717,654t of cement for US$44.4m in the first half of 2015, compared to 709,459t of cement for US$48.9m in the same period of 2014.

Oman: According to Reuters, Raysut Cement posted a 33% drop in its second-quarter net profit. It made US$12.8m in the second quarter of 2015 compared with US$19.1m in the same period of 2014. Raysut Cement reported a first-half post-tax profit of US$28.5m compared to US$40.5m in the same period of 2014.

Vietnam: According to Vietnam News Agency Bulletin, domestic cement consumption and exports both improved in the first half of 2015 despite increased competitive pressure from neighbouring countries.

Statistics from the construction ministry showed that in the first half of 2015, Vietnam's cement consumption grew by 6% year-on-year to 34.2Mt, meeting 47% of the whole year's target. Of this, domestic consumption was 5% higher than in 2014 at 25.9Mt. Vietnam exported 8.19Mt of cement, representing an 8% year-on-year increase. In June 2015, cement consumption was estimated at 5.68Mt, 12% higher than in 2014, including 4.63Mt in the domestic market and 1.05Mt for exports. The ministry said that cement and clinker exports in the first half of 2015 faced difficult conditions in some markets, especially Bangladesh.

Nguyen Quang Cung, chairman of the Vietnam Cement Association, said that there was no concern about the cement consumption in the 2015 - 2016 period thanks to a rising domestic demand. In 2015, domestic cement consumption is estimated to increase by 5Mt. Cung said that cement consumption in the domestic market has risen thanks to improvement in the real estate market, while rural infrastructures have been actively developed. The ministry has calculated that cement consumption in 2015 will grow by 1.5 – 2% to 72 - 74Mt. Of this, local consumption will be 53 – 54Mt, while 19 – 20Mt will be exported.

In 2015 Vietnam will have two new projects, including the 600,000t/yr capacity Song Lam 2 cement plant and the 3.6Mt/yr capacity Cong Thanh Cement plant. This will bring the country's total cement production lines to 76, with 81.6Mt/yr of designed capacity.

Cement production in 2016 is expected to meet domestic consumption demands plus 15 – 16Mt of exports, in addition to a reserve of 10 – 15% to stabilise the market, especially in the southern region. Cung said that there will not be any new cement projects in 2016, although a number of major projects would be carried out during the 2017 - 2018 period.

India: According to Accord Fintech, Burnpur Cement's new plant at Patratu Industrial Area, Patratu, Jharkhand was inaugurated by chief minister of Jharkhand, Shri Raghuvar Das, on 13 July 2015.

China: According to Reuters, Jiangxi Wannianqing Cement expects its net profit for the first half of 2015 to fall by 50 – 70% year-on-year to US$12.2 - 20.3m. It has blamed the fall on weak selling prices.