Displaying items by tag: Guizhou

China: Switzerland-based Maerz has commissioned two lime kilns for Guizhou Gangli Xinmin New Material’s plant in Guizhou province. The new plant includes a 600t/day R4S kiln and an 800t/day R5S kiln. Both kilns are coal fired. This is the first time Maerz has supplied kilns to Guizhou Gangli. As part of the project, Maerz supplied engineering and key equipment as well as technical support services for the commissioning and firing of the kilns. Maerz’s long-standing local partner Shanghai Maiyao built the turnkey plants and will operate them on behalf of the customer for the next few years.

China: China Resources Cement’s turnover rose by 3% year-on-year to US$5.16bn in 2020 from US$5.02bn in 2019. Its profit attributable to shareholders was US$1.15bn, up by 4% year-on-year. Sales volumes of cement grew by 6% to 87.3Mt from 82.5Mt. Volumes increased in Guangdong, Guangxi, Yunnan and Guizhou but decreased in Fujian, Hainan and Shanxi.

In February 2020 the cement producer completed the construction of one 1.4Mt/yr clinker production line and two cement grinding lines with a combined cement production capacity of 2Mt/yr in Anshun City, Guizhou. Also in 2020 the group commissioned one new concrete batching plant and shut down two others.

During the reporting year the Group co-processed 183,100t of municipal solid waste, 52,800t of urban sludge with an 80% moisture content and 6100t of hazardous industrial waste. It operates seven co-processing projects with four more either under trial operation or under construction. It also said that it had been following policies for carbon emissions with trial activities conducted in preparation for a future unification of national carbon market. Eight company plants in Guangdong and five in Fujian were reported as having settled their carbon credit quota for 2019.

Other operations of note include the start of Phase 1 of the group’s intelligent manufacturing pilot project at a unit in Tianyang in conjunction with Siemens. The group has also commenced trial operation of its in-house developed intelligent manufacturing system at a cement plant in Pingnan, Guangxi. The project interacts with system quality management systems and advanced kiln controls. The next step will be to use the quality management system at cement plants in Shangsi and Guigang, Guangxi. A so-called ‘lighthouse plant’ is also planned to work with environment, health and safety, operation, production, equipment, quality, mines and logistics at a cement plant in Fengkai County, Guangdong. The group’s platform for sharing auxiliary materials and spare parts was launched in Fujian in April 2020 and has since been rolled out to sites in Guangdong, Guangxi and Hainan. Finally, the company’s ‘Smart Card’ logistics system has put into operation at cement plants in Fengkai, Huizhou, Luoding and Dongguan, Guangdong and has been operating at 25 cement production plants by the end of 2020.

The publication of CNBM’s financial results presents a good opportunity to take stock of the Chinese cement industry in the first half of 2019. Looking at the big picture first, cement sales rose by 5% year-on-year to 1.03Bnt in the first half of 2019 from 0.98Bnt in the same period in 2018. Graph 1 below shows the sales over the last five years since 2014. Generally, sales are decreasing each year but there has been some variation in the half-year periods.

Graph 1: Cement sales in China, 2014 – 2019. Source: National Bureau of Statistics of China.

As the China Cement Association (CCA) pointed out in its summary for the first half of 2019, the cement industry ‘swelled in volume and price’ as industry efficiency grew but that the growth rate dropped ‘significantly’ compared in 2018. By region, as Graph 2 shows, variation can be seen between the south-east of the country where growth was slow or even fell compared to stronger performance elsewhere. Cement production increased by above 20% in Jilin, Shanxi, Shandong, Tibet and Heilongjiang and by over 10% in Hebei, Gansu, Tianjin, and Liaoning. However, it fell in Hainan, Beijing, Qinghai, Guizhou, Guangxi, Hunan, Guangdong and Ningxia. Most of these changes were attributed to either rising or falling demand for cement, except for Jilin where reduced imports from neighbouring provinces pushed up its demand. In most of these latter regions it attribute the decline to falling demand for cement.

Graph 2: Cement production growth by province in first half of 2019. Source: China Cement Association.

Other points of note from the CCA include the surge in imports to China. Imports of cement and clinker rose by 149% year-on-year to 8.97Mt in the five months from January to May 2019. Vietnam supplied 68% of this followed by 11% from Thailand. On the production side, 10 new production lines with a total capacity of 15.5Mt/yr were commissioned in the period. These were fairly scattered across nine provinces, in Shanxi, Anhui, Hubei, Fujian, Guangxi, Hunan, Guizhou, Gansu and Yunnan respectively.

Sales and profits were supported by growing demand and prices on the corporate side. CNBM’s operating income for its cement businesses grew by 16% to US$8.14bn from US$7.04bn. Its adjusted profit increased by 40% to US$2.76bn from US$1.98bn. Anhui Conch’s sales rose by 17.9% to US$2.15bn from US$2.11bn. It blamed poorer profits in the south of the country on adverse weather leading to weakened demand.

The weaker sales in the south could be seen in China Resources Cement’s (CRC) results with its turnover down by 6% to US$2.22bn from US$2.36bn. Likewise, its earnings before interest, taxation, depreciation and amortisation (EBITDA) dropped by 8.5% to US$820m from US$896m. The majority of its cement plants are based in Guangxi, Guangdong and Fujian. Jidong Cement was also reported as having received US$30m in subsidies from the government during the first half of 2019 in relation to its ‘daily activities.’

As is usual for these kinds of roundups the dynamic in China is between government industrial policies, like peak shifting and pollution mitigation, and local demand and price trends. One of the latest spins on peak shifting, for example, is a rating system that is being considered to decide which companies should be subject to production limits and for how long. General cement sales are slowly falling each year but the rise of imports into the word’s biggest cement producing nation (!) mark an interesting trend. Also, it may not be connected, but lots of those provinces with falling demand so far in 2019 are those on the south coast facing the heavy clinker exporting nations of South-East Asia. Given the decisiveness with which the Chinese government dispensed with imports of waste materials under its National Sword initiative since 2017, those countries importing cement to China should beware. It could change very quickly. The Chinese cement market is never dull.

China: West China Cement’s sales revenue rose by 24% year-on-year to US$881m in 2018 from US$709m in 2017. Its cement sales volumes fell by 3.2% to 18.1Mt from 18.7Mt. Its earnings before interest, taxes, depreciation and amortisation (EBITDA) grew by 40.6% to US$393m from US$279m. Despite falling sales volumes, the cement producer said that increased prices boosted its margins.

By region the company said that sales volumes in Shaanxi Province remained stable, while the continuous low demand in the Xi’an Metropolitan Area and Central Shaanxi region led to occasional peak-shifting production halts by all producers during low season periods. Sales volume in Xinjiang Province remained low, while that of Guizhou Province were stable.

China: Huaxin Cement’s sales revenue rose by 1.9% to US$1.96bn in 2016 from US$1.93bn in 2015. Its cement and clinker sales rose by 5% to 52.7Mt and its net profit rose sharply to US$65.6m from US$14.9m. It attributed its result to following government-promoted supply side reforms such as cutting production costs. The cement producer noted that its had increased its usage of alternative fuels in the second half of the year following an increase in the cost of coal.

During the reporting period Huaxin Cement put its 3000t/day Tajikistan Sughd clinker production line into operation. It also purchased 15 cement plants from LafargeHolcim, including four grinding plants, located in Yunnan, Chongqing and Guizhou provinces. Altogether the new cement and clinker production capacity is expected to reach 10Mt and 15Mt respectively. The company also added that it had 25 alternative fuels co-processing projects operating or under construction with a capacity of 5Mt/yr.

China: China Resources Cement’s revenue has fallen by 24% year-on-year to US$609m in the first quarter of 2016 from US$800m in the same period in 2015. Its gross profit fell by 39% to US$126m from US$207m. However, its profit attributable to the owners of the company fell by 99% to US$0.85m from US$85.1m. It blamed the drop in gross profit on lower selling prices in the quarter compared to 2015.

The cement producer reported that its sales volumes of cement grew by 6% to 15.8Mt in the quarter. Rises in sales volumes were reported in Guangxi, Yunnan and Guizhou.