Displaying items by tag: GCW271

News from the Democratic Republic of the Congo (DRC) this week: Lucky Cement has nearly finished its new 1.2Mt/yr cement plant. The US$270m project is due to start commercial operation in October 2016, according to a report by Bloomberg. The news is fascinating because it marks the opening up of central sub-Saharan Africa to the cement industry and it puts the boots of Pakistan’s Lucky Cement on the African continent in a big way.

The Nyumba Ya Akiba plant is a 50:50 joint venture between Lucky Cement and a local conglomerate Groupe Rawji, with financing supplied from a group of international development agencies. Originally proposed in 2013 the plant is located in Kongo Central province in the far west of the country between Kinshasa and the port of Matadi near to the connecting main road and railway line. The kit for the plant was ordered from FLSmidth in 2014 for Euro68m, including crushers, pyro processing equipment and vertical mills for raw meal, coal and cement grinding. An overview from the International Finance Corporation also added that the plant intended to cut a deal to import South African coal via the railway from the coast. Limestone and clay will come from a captive quarry. Incidentally, FLSmidth reckoned in 2015 that the project was the first new cement plant in the country in 40 years.

From Lucky Cement’s perspective the project makes sense given the bad reaction it has had trying to import its cement into western and southern Africa. Local producers recoiled from cheap imports along the coast and then lobbied their governments to block them. So, putting down manufacturing roots in a target country with a local partner makes it that much harder to block additional imports. It may or may not be importing its own clinker from somewhere else to supplement local demand but it is definitely providing local jobs and supporting local development. Lucky Cement’s previous international adventure of this kind was the opening of a cement grinding plant in Iraq in 2014.

Naturally, like buses, one waits ages for a cement plant to be built and then two turn up at the same time. South Africa’s PPC is also building an integrated cement plant in the DRC at Kimpese, in the same province as Lucky Cement’s plant. PPC’s half year report to March 2016, released in September 2016, mentioned that its 1Mt/yr plant was 83% complete with all civic and structural work complete. Commissioning was intended for the end of 2016 with cement ready for sale in early 2017. It is being built by Sinoma. The cement producer already has a sales depot in Kinshasa and it exports 32.5N and 42.5N cement from South Africa to the territory. Given PPC’s falling revenues from cement in South Africa and growing revenue elsewhere in Africa the opening of this plant will be keenly awaited.

The local demographics may answer whether the DRC can support two new cement plants. The country’s cement consumption was just 24kg/capita with a gross domestic product (GDP) per capita of US$490 in 2015. These are some of the smallest figures in the world. A feasibility study ahead of the Nyumba Ya Akiba plant estimated that the country would have a demand of 1.8Mt/yr by 2015 compared to a local production capacity of under 1Mt/yr. Nature, and markets, abhor a vacuum. Lucky Cement and PPC are about to fill it.

US: Summit Materials has appointed Noel R Ryan III as its new Vice President, Investor Relations. Ryan has more than 15 years’ experience in the investor relations and capital markets industries, most recently serving as Vice President and Head of Investor Relations & External Communications for Calumet Specialty Products Partners, a publicly traded producer of specialty hydrocarbon and fuels products.

Previously, Ryan served as head of the investor relations function at Delek US Holdings and as head of corporate communications at QEP Resources. Prior to these roles, he was Executive Director and Co-Head of the Financial Communications Practice Group at a nationally-ranked investor relations consultancy. Ryan began his career in US equities research at Banc of America Securities. He holds a Bachelors of Arts degree from the University of California, Berkeley.

India: The board of directors of Wonder Cement, a part of the RK Group, has appointed Sailesh Mohta as President (Marketing). Mohta will report into JC Toshniwal, Managing Director, according to Asian News International. Mohta will oversee strategic business partnerships and develop tactical policies aimed at augmenting the national presence of the brand, identifying potential markets, implementing a conducive growth stratagem and generating a significant share of voice in the marketplace.

Since 2010, Mohta has served as the president of Binani Cement. He holds a bachelor's degree in commerce from the University Of Mumbai and a chartered accountancy degree from the Institute of Chartered Accountants of India. He is also a member of Multi Commodity Exchange of India and National Spot Exchange.

Ethiopia: Rioters have set fire to trucks and machinery at the Dangote cement plant at Ada Berga in Oromia, according to the Ethiopian state broadcaster Fana. The riots have followed the deaths of at least 55 people in a stampede at a local religious festival on 2 October 2016. Regional government offices were also set on fire and a police station was stormed during the fracas.

Zimbabwe: Lafarge Zimbabwe has blamed cash shortages for mounting losses. The company reported that it made a loss of US$2.2m in the first six months of 2016, up from a loss of US$1.3m in the same period of 2015. Its sales revenue grew slightly to US$26.5m from US$25.4, according to the New Zimbabwe newspaper. The cement producer has blamed the loss on cash shortages in the country and competition from imports.

“The volumes of cement sales remained subdued due to increased competitive activity in the total market following the influx of cement imports into the country as well as the entry of a major competitor into the Harare market,” said chairman Kumbirayi Katsande. He added that import restrictions would be helpful but that they would not solve major structural problems with the local economy.

Cash shortages are causing delays in paying foreign creditors said Katsanda. The country is preparing to introduce bond notes, a new local currency, to ease the problem, in November 2016.

Russia: Schenck Process has installed two Logiq dispatch automation systems at two LafargeHolcim cement plants at Ferzikovo and Voskresensk. This has resulted in the plants being upgraded to the LafargeHolcim group’s Smart Factory standard.

At Ferzikovo LafargeHolcim is currently engaged in a major investment project for the Russian market. The plant has three incoming and outgoing scales as well as 11 loading stations for loose cement and two bag loading stations. Schenck Process converted the parking lot with registration, the incoming and outgoing scales and all loading points for fully automatic, unmanned operation. Self-service terminals for registration and weighing were installed in the entrance and exit areas. In the loose loading area, a Logiq loading terminal, including the Disomat Tersus weighing electronics with Profibus interface to the PLC and ultrasonic sensors, were installed. In Voskresensk the conversion work included the car park with registration, incoming and outgoing scales, three loading scales and one loading point for packaged goods.

Schenck Process ensured smooth delivery operations at both plants throughout the installation and commissioning process. Incoming silo trucks for loose loading, more than 300/day at Ferzikovo alone, continued to be processed throughout.

Since 2013, Schenck Process has implemented the Logiq dispatch automation system at various plants belonging to the Swiss construction material group, including at 18 cement plants in eastern Europe.

Colombia: Cemex Latam has secured an interim contract with the government for its cement plant project in Maceo, Antioquia. The temporary solution will last until the end of an investigation into the irregular acquisition of the land, tax-free area and mining rights for the factory by Cemex Latam Holdings in 2012, according to the El Espectador newspaper. The company also intends to negotiate an extension of the lease contract, as per its original plans, in order to commence operation of the plant in early 2017.

An internal probe into the land deal found that irregular payments of US$20.5m had been made to Eugenio Diaz Correa, an individual connected to the deal. Cemex has fired Edgar Ramirez, vice president of planning, and Camilo Gonzalez, head of legal department, as part of the investigation and Carlos Jacks, the company's regional director, resigned. Cemex Latam has hired an external audit team and legal representatives in the case that was passed on to the Attorney General's Office of Colombia.

Democratic Republic of Congo: Pakistan’s Lucky Cement is set to open its US$270m Nyumba Ya Akiba cement plant in Bas-Congo later in October 2016. The 1.2Mt/yr plant will be operated with Groupe Rawji, a local company, under the name CIMKO. It is financed by the African Development Bank, the International Finance Corporation, EKF and by Habib Bank among others, according to Bloomberg.

“We will take care of everything that can hinder your production, unfair competition, fraudulent imports, we will take care of that,” said Prime Minister Matata Ponyo Mapon to CIMKO executives in a show of support for the project at a recent meeting.

Mexico: Cemex wants to sell its 23% stake in Grupo Cementos de Chihuahua through a secondary public offering. Cemex has asked the Comisión Nacional Bancaria y de Valores, Mexico's banking and securities regulator (CNBV), to approve the planned transaction, under which the Mexican building materials company will offer the shares to domestic and foreign investors in a concurrent private placement. The sale will be part of Cemex’s previously announced asset disposal plan. The company wants to sell up to US$2bn worth of assets to reduce its debts.

Palestine: The Palestine Investment Fund (PIF), the investment arm of the Palestinian Authority, has launched the first phase of a new cement plant, the first in the Palestinian areas. Investment in the plant is expected to reach US$310m and production will start in 2018.

The opening ceremony took place at the Jaser Palace in Bethlehem under the patronage of President Mahmoud Abbas. PIF chairman of the board Mohammad Mustafa attended the event with Louai Kawas, chief executive officer of Sanad Construction Industries Company, a PIF-owned company in charge of the plant.

Sanad Construction Industries Company was established in 1994 for the purpose of meeting the needs of the Palestinian construction market such as the provision of building material. The cement plant is intended to provide 90% of the cement needs for the Palestinian construction market. At present cement for the territory is purchased from Jordan and Israel.