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News GCW77

Displaying items by tag: GCW77

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Where to build an African cement plant

28 November 2012

The outgoing chief executive of PPC (Portland Pretoria Cement) officer, Paul Stuiver, summed up the dilemma facing cement producers on the east coast of Africa. Building near the coast leaves you vulnerable to imports.

In a recent interview with the South African business weekly, 'Financial Mail', Stuiver said that imports are not a threat to African expansion, provided that a facility is not built within 200km of a port. Exactly the same issue was raised by Yves De Moor in his column in the November 2012 issue of Global Cement Magazine.

Countries along Africa's east coast receive imports, but Stuiver said that Africa's high logistics costs mean the prices increase steeply as the cement is transported inland. He commented that the markets in Mozambique and KwaZulu Natal in South Africa were especially vulnerable and that most imports to South Africa come through Durban. Unsurprisingly both of PPC's big recent investments have been in landlocked countries, Zimbabwe and Ethiopia respectively. In July 2012 it also tried to invest in CINAT, the Democratic Republic of Congo's state-owned cement producer.

The import issue to South Africa reignited last week when the South African National Regulator for Compulsory Specifications (NRCS) confirmed that it had confiscated 'sub-standard' cement imported from Vietnam. As we covered in August 2012 in this column this follows a row in July 2012 about whether cement from Pakistan's Lucky Cement was complying with South African standards.

Although standards still lead the argument, more honesty has emerged with the use of the word 'dumping' in the complaints. Stuiver explained that "...the price of cement from Pakistan, India and Vietnam is low because electricity, fuel and transport rates are subsidised." Whilst PPC can report that its revenue has risen by 9% to US$837m for the first nine months of 2012, complaints against foreign imports seem overly protective. In 2009 PPC confirmed the existence of a cartel in the country. PPC has even gone to the Advertising Standards Authority to stop imports with elephants on their bags!

With reports that Nigerian producer Dangote is building a new US$389m plant in South Africa, thoughts turn to what will happen once South Africa becomes 'self-sufficient' in cement, like Nigeria which has proudly announced this recently. Giant infrastructure projects are one way to use all that excess cement and this is what Lafarge WAPCO has been asking the Nigerian government to do recently, in a road building drive. Better transport links in South Africa would wreck Stuiver's maxim about not building near a port.

Two solutions from this week's news might appeal to the industry on the south and east coasts of Africa. The first is to use inventive export barriers just like the Bureau of Indian Standards have imposed to slow down exports from Pakistan. The second is to persuade importers to do what a North Korean ship reportedly did with its consignment of cement this week off the coast of Somalia: dump it in the sea.

Published in Analysis
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Lafarge UK/Tarmac joint venture appoints key staff

28 November 2012

UK: Lafarge and Anglo American have appointed the chairman, chief executive office (CEO) and CFO of their joint-venture in the UK. Jamie Pike is appointed as non-executive Chairman, Cyrille Ragoucy as CEO and Guy Young as CFO of the joint-venture. The appointments are subject to the completion of the joint-venture and final clearance from the UK Competition Commission. It is anticipated that the joint-venture will commence operations in early 2013.

Jamie Pike, aged 57, is the non-executive chairman of Lupus Capital, a leading international supplier of building products to the door and window industry, RPC Group, a leading international supplier of rigid plastic packaging and MBA Polymers, a private US plastics recycling business. He was chief executive of Foseco, an international business serving the foundry and steel-making industries, until its acquisition by Cookson Group in April 2008. He led the buy-out of Foseco from Burmah Castrol in 2001, which culminated in flotation on the main market in 2005.

His early career was as a consultant with Bain and Co and A T Kearney before joining Burmah Castrol in 1991. He rose to chief executive of Burmah Castrol Chemicals before leading the Foseco buy-out. Pike was educated at the University of Oxford, holds an MBA from INSEAD and is a member of the Institute of Mechanical Engineers.

Cyrille Ragoucy, aged 56, is currently senior vice president for Health and Safety at Lafarge. From 2005 to 2009 he was CEO and regional president for Lafarge's cement operations in China (Lafarge Shui On Cement) where he was responsible for 25 plants and 10,000 people. Between 1999 and 2005 he was regional president for Aggregates, Concrete, Asphalt and Paving for Lafarge in Eastern Canada. Ragoucy joined the Lafarge group in 1998 as vice president Cement Strategy for Lafarge North America.

Guy Young, aged 43, has been CFO of Tarmac since 2010 with responsibility for Tarmac's financial, IT and legal operations as well as the pre-integration planning for the joint venture. Guy has been with Anglo American for 15 years in a variety of roles, including CFO of Scaw Metals, Group Procurement and within the CEO's Office. Guy was educated at the University of Cape Town and qualified as a chartered accountant after doing articles at Deloitte.

Published in People
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India slows Pakistan exports with US$10,000 guarantee

28 November 2012

India: India has made all cement exports subject to a US$10,000 Performance Bank Guarantee. A letter issued by the Bureau of Indian Standards (BIS) to all foreign cement manufacturers explained that cement exporters will have to submit this guarantee in order to be qualified to export cement to the country.

Pakistan cement producers view this as another non-tariff barrier imposed by the BIS to restrict cement exports from Pakistan despite the country being designated 'most favoured nation' status by India effective from 1 January 2013.

According to an industry official quoted by the Pakistani Observer, India has previously used non-tariff barriers to slow Pakistan exports. In 2007 the BIS issued licenses to Pakistani cement manufacturers after physical verification of their production process but these expired leading to slowdowns in cement exports.

Published in Global Cement News
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Extension of Russian contract for FLSmidth

28 November 2012

Russia: The Danish cement plant manufacturer FLSmidth has won a contract worth approximately Euro27m from the Russian company Kaluga Cement Plant LLC to supply additional equipment for its cement plant currently under construction in the Kaluga province, 300km southwest of Moscow. The contract is an extension of the contract that FLSmidth won in 2011 from Kaluga for the supply of a complete cement plant.

"The award of this order to FLSmidth underlines the strength of our good relations with the customer and the value of our long-standing local presence in Russia," said Group CEO Jørgen Huno Rasmussen. "The order is also a good example of the general signs of a positive development in the cement market."

Published in Global Cement News
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North Korean ship accused by Somalia of dumping cement

28 November 2012

Somalia: Authorities from the autonomous Somali state of Puntland have impounded a North Korean ship for allegedly dumping cement off the country's coast.

The Democratic People's Republic of Korea flagged vessel MV Daesan was captured near to Bossaso whilst it was unloading 5000t of cement. The MV Daesan had originally been heading to Mogadishu but its cargo was rejected due to water leakage.

According to NK News and Radio Gaalkacyo the Somali authorities condemned the dumping as 'illegal' and 'environmentally destructive.' The Somali authorities are reportedly planning to bring the crew before a court.

Published in Global Cement News
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Nesher Cement CEO Joel Feldschuh to leave at end of 2013

28 November 2012

Israel: Nesher Israel Cement Enterprises CEO Joel Feldschuh has announced to shareholders that he will leave the company on 31 December 2013. Feldschuh has spent nine years in post at Nesher.

"Over the past nine years Nesher met all the economy's needs for high-quality products at competitive and fair prices and most of all, at a high level of service," said Feldschuh.

Published in Global Cement News
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Zambezi Portland Cement directors deported

28 November 2012

Zambia: Two Italian managers working for Zambezi Portland Cement have had their residence permits revoked by the Zambian Immigration Department. Operations director Danielle Ventriglia and marketing director Valerio Ventriglia have both returned to Italy.

Home Affairs Minister Edgar Lungu denied that the managers had been deported. He stated that their residence permits had been revoked and consequently cancelled because the two directors based in Ndola had violated the Immigration and Deportation Act No 18 of 2010. Lungu said the government would deal with people who 'mistreat' Zambian workers and was determined to cleanse all institutions by uprooting 'bad elements'.

Zambezi Portland Cement Operations manager Mwamba Kayula appealed to the government to reverse the decision, saying that Ventriglia was behind the success of Zambezi Portland Cement. "This man has been operations director for the past two years, he was born in Luanshya and we still need to continue with his good work at the company," said Kayula.

Published in Global Cement News
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Cemex changes downsizing plans after deal with unions

27 November 2012

Spain: Cemex España, the Spanish unit of Mexican cement company Cemex, will launch a downsizing plan for 280 employees, down from the initial intention to cut 370 jobs. The 25% reduction came as a result of an agreement reached between the company's management and trade unions.

The employees to be affected by the staff-reduction measure account for 16% of all of Cemex's 1740 employees in Spain at present. The laid-off employees will receive severance pays of 30 days per every year of work but not more than 22 monthly salaries.

Cemex's adjustment has had to be carried out due to the continued low demand for cement in the country. Cemex reported a 19% drop in its sales in Spain in 2011. The country is the company's third largest market in terms of the number of cement production plants after Mexico and the USA.

Published in Global Cement News
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Holcim announces new Colombian plant

26 November 2012

Colombia: Swiss construction materials company Holcim has announced plans to double its cement production capacity in Colombia by investing US$600m in a new 2Mt/yr cement plant, according to an official statement.

Holcim, which currently produces around 2.1Mt/yr of cement in Colombia at its Nobsa plant, is conducting a feasibility study for the new facility. The construction phase is expected to create 1000 direct and indirect jobs.

"We're evaluating the departments of Bolívar and Antioquia as possible locations but we've yet to make a decision," said country manager, Miguel Ángel Rubalcava.

The new plant announcement comes as the Colombia government embarks on an

ambitious investment programme to develop its infrastructure. Among the plan's goals are a fourfold increase in the country's four-lane highways by 2018.

Infrastructure investments in the country are expected to reach US$10bn by 2014, compared to US$3bn in 2012.

Published in Global Cement News
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Problems for another Vietnamese project

26 November 2012

Vietnam: Chen Liang-chuan, the Taiwanese founder of Taipei-based Lucky Cement, has had his US$160m Ninh Binh Cement plant in Vietnam thrown into doubt by the Vietnamese government changing its mind on a decision to award the plant limestone mining rights.

Liang-chuan has invested in the 4Mt/yr project since 2008 after being awarded the right by the local government to mine a 72-hectare limestone field for 49 years. The project was approved by Nguyen and related ministries. However, just as the plant's two new production lines were set to begin trial runs, the local Ninh Binh government rejected the request to begin exploiting the field, because it had designated the field part of the Trang An Scenic Landscape Complex. It plans to apply to UNESCO in September 2013 to have the complex recognised as a world heritage site.

Sources at Lucky Cement said that Vietnamese authorities were trying to find another limestone mine to replace the original field, but they were worried that a new mine location would entail additional transportation costs.

Published in Global Cement News
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