Displaying items by tag: Government

Trinidad & Tobago: Trinidad Cement has been granted permission by the government to resume operations at its Claxton Bay integrated plant. It closed production in early April 2020 due to coronavirus-related government advice. General manager Guillermo Rojo said that the subsidiary of Cemex has implemented multiple protocols, including temperature testing at all access points and the activation of a local Rapid Response team.

Gabon: Data from the Directorate General of Economy and Tax Policy shows that national cement production rise by 10.6% year-on-year to 0.54Mt in 2019. The improving trend has been attributed to better use of existing manufacturing equipment and the resumption of activity at the CimGabon plant in Ntoum, according to the L’Union newspaper. Clinker imports also grew, by 14.6% to 0.44Mt. Overall cement sales increased by 8.5% to 0.53Mt.

India: Tata Chemicals has resumed full production of salt and sodium bicarbonate at its Mithapur site in Gujarat. It said that production levels have been matched to market demand for soda ash and cement. The 1500t/day integrated cement plant at the industrial complex manufactures two varieties of cement under the brand name Tata Shudh. Tata Chemicals has also resumed the operations at its chemical plants at Mambattu-Nellore in Andhra Pradesh, Sriperumbudur in Tamil Nadu and Cuddalore in Tamil Nadu). Operations at the company’s various production sites were scaled down in late march 2020 in response to the Indian coronavirus lockdown.

UK: The government has encouraged construction work to resume from 11 May 2020. Foreign Secretary Dominic Raab said, “Those who can’t work from home - thinking particularly the construction and manufacturing sectors - we are encouraging to go back to work now.” The advice follows the Prime Minister Boris Johnson’s speech of 10 May 2020, in which he announced the easing of the nation’s coronavirus lockdown as it moves into its second phase. Johnson said that a second spike in infections would lead to a return to full lockdown.

India: The Federation of Indian Chambers of Commerce and Industry (FICCI) has asked the government to restart home and road building to help cement producers. The Press Trust of India newspaper has reported that all construction work has stalled since 25 March 2020 due to the coronavirus lockdown. The FICCI believes that Indian cement demand is currently set to decline by 10-12% year-on-year. To relieve the sector, the FICCI urged the Indian government to lift the lockdown in metropolitan areas in order to allow the continuation of residential construction, which accounts for 60-65% of cement demand.

To protect domestic producers from any import dumping post-crisis, the FICCI has suggested that Indian cement sales should be subsidised. It also requested a ‘relaxation of environmental emission norms’ until mid-2022 ‘to save the industry from additional capex expenses.’

Oman: Cement producers have reacted positively to anti-dumping measures implemented by the Ministry of Commerce and Industry. The Oman Observer newspaper has reported that the measures, which consist of quality screening, have, since coming into force on 1 March 2020, been ramped up in construction, with a general restriction of the movement of goods due to the coronavirus. Raysut Cement said, “These measures will enable Raysut Cement and our peers Oman Cement to operate at full capacity. We hope that the authorities will continue to strictly enforce this measure in the interest of fair market competition.”

Raysut Cement said that it is ‘Aggressively pushing ahead’ with its US$30m Port of Duqm grinding plant project, which is due for commission in March 2021. “It is a good time for countries like Oman to become self-sufficient in the domestic availability of a strategic commodity like cement,” it said. On 4 May 2020 Raysut Cement announced plans to lobby the government for a gas or electricity subsidy.

Oman’s cement demand is currently 20-25% below pre-lockdown levels.

South Africa: PPC has reported a predicted 95% year-on-year decline in its sales of cement in South Africa in April 2020 due to the impacts of the coronavirus. Sales in Rwanda and Zimbabwe, where production resumed in mid-late April 2020, are expected to decrease in the month by 80-85% year-on-year.

PPC says that PPC South Africa is preparing to resume production in line with the government’s risk-based regulations announced on 25 April 2020. The group said, “The uncertainty around the further development of the containment of the coronavirus makes it necessary for PPC to work with various scenarios.”

Turkmenistan: Cabinet of Ministers’ Deputy Chair Shamuhammet Durdylyev has announced plans for the country to produce a new grade of cement. Turkmenpor News has reported that the cement, designated 500-G20-K, will contain basalt porphyries. Durdylyev has said that the Ufra deposit in the Balkan region of western Turkmenistan will supply the basalt porphyries, adding, “These mineral substances significantly improve the quality of cement.”

The move’s aim is reportedly to boost Turkmen cement plants’ productivity without increasing the reliance on imports.

The headline from the cement section of FLSmidth’s first quarter results summed up what may be the current situation for many companies supplying the sector: “service relatively stable – cautious on capex.” The general picture across both its mining and cement businesses was ‘significantly’ increased demand for local resources, remote support and digital products. On the mining side FLSmidth pointed out that it was impossible to assess the impact of coronavirus on its business because of the difference between government policies. Some places continue lockdowns or impose additional restrictions but others are starting to ease them. This point has ramifications for multinational cement producers and other suppliers too. It seems likely to continue during the coming months as lockdowns ease at different rates in different countries.

On cement specifically, FLSmidth provided a good global view of what the pandemic and government responses are actually doing to the industry. It reports that around 80% of the world's cement plants (excluding China) are currently in operation with some operating at reduced capacity. It described the market for services as ‘relatively stable’ in the first quarter but that cement consumption was being reduced by lower construction activity, plant shutdowns and restricted access to sites leading to reduced demand for technical services and commissioning. By region it identified the biggest impact to its business from coronavirus in India and the Middle East. Generally, it says that cement producers are suspending capital investments until the impact of coronavirus on economies is clearer. There has been some good news though, with the supplier noting that several of its customers have been looking for services that can reduce their operational costs.

The European Commission tackled this pervading sense of uncertainty in its roadmap towards lifting coronavirus containment measures that was published on 15 April 2020. The Committee for European Construction Equipment (CECE) was keen to share this with its members this week, pointing out how the European Union (EU) plans to lift border controls and re-start economic activity.

The plan is to ease travel restrictions between border regions for cross-border and seasonal workers, and then between European areas with low coronavirus infection rates. External borders can later be reopened with access by non-EU residents to the EU scheduled for a second stage. To re-start economic activity the EU recommends, again, a phased approach focusing on sectors that are ‘essential’ to facilitate economic activity such as transport. The commission says it will also create a rapid alert function to identify supply and value chain disruptions, relying on existing networks such as Enterprise Europe Network (EEN), clusters, chambers of commerce and trade associations, small and medium enterprise (SME) envoys and more. Whether the EU can actually coordinate a return to normality following its poor response in aiding Italy at the start of the European outbreak of coronavirus remains to be seen. Yet, its historical roots as an economic community dating back to the Treaty of Rome in 1957 suggests it may be more successful when coordinating technical aspects of trade.

Detailed above are the views and plans of just one supplier and one continental organisation, although they are both prominent. The takeaway from this is that uncertainty is a major problem so far for the cement industry in the wake of the coronavirus outbreak. Companies have faced a cash crunch in the short term as economies slowed down and they are reluctant to release cash until the future becomes clearer. Large parts of the cement industry and its suppliers are very international, which exposes it to even more uncertainty. Different countries enforcing different restrictions and different easing strategies at different times create a major headache for everyone and a block to investment. Making cement is undeniably an essential industry and this realisation by legislators can be seen in some countries that at first shut down their plants before understanding that they needed them open after all! Suppliers should benefit from this too, although at reduced activity levels. We don’t know what kind of recovery will come – hopefully one releasing plenty of pent up demand. Yet one thing is certain. The work of the regional cement associations and those representing suppliers is going to be crucial in the coming months.

Norway: Private accreditation body DNVGL has certified Aker Solutions’ 400,000t/yr carbon capture and storage (CCS) system installation at Germany-based HeidelbergCement subsidiary Norcem’s 1.2Mt/yr integrated Brevik plant in Telemark as safe. HeidelbergCement Northern Europe director of sustainability and alternative fuels Per Brevik said, “The promising results from pilot testing in Brevik give us confidence that realisation of the full-scale capture plant will be successful. We trust that the project risk related to novel technology elements is low.”

Following an 18-month test of the partial installation, the certification ensures that the full-scale project will receive government funding.