Displaying items by tag: Production
Iran stops producing clinker for 30 days
19 January 2015Iran: Iran's cement plants have all stopped producing clinker for 30 days, as of 14 January 2015. Abdolreza Sheykhan, an official with Iran's Cement Producers Association, said that the country currently has 17Mt of clinker in store.
"We have stopped producing clinker in order to turn the current inventory to cement," said Sheykhan, adding that the country's need is only 10Mt until the end of the current Iranian calendar year on 20 March 2014. The Iranian oil ministry will pay US$7/t of cement to production plants to compensate for their loss. "Iran's current cement output is around 6.5Mt/month," said Sheykhan. "The country's need, however, is around 4.5 – 5Mt/month."
Iran exported nearly 9.25Mt of cement in the first eight months of the current Iranian year, which started on 21 March 2014. This is 8.5% lower compared to the same period in the previous year. Sheykhan had previously said that the insecurity in Iraq and reduction in the number of destination markets for Iran's cement are the major reasons behind the fall in exports.
"Azerbaijan was one of the major importers of Iran's cement, but the country has now reached self-sufficiency and reduced its imports from Iran," said Sheykhan. He named Russia and African countries as new markets for Iran's cement exports, adding that by taking the mentioned markets, Iran can increase its cement and clinker exports by 1.5Mt/yr.
US cement growth to meet expectation
08 December 2014US: Despite a late start to the construction season and weaker than expected housing start numbers, a recently released report from the Portland Cement Association (PCA) shows that cement consumption in the USA will meet 2014 forecast expectations.
The PCA's cement forecast remains essentially unchanged since the September 2014 forecast. "The United States' cement market is expected to grow by 8.2% in 2014, followed by similar rates of growth in 2015 and 2016," said PCA Chief Economist and Group Vice President Edward Sullivan. "However, minor adjustments have been made regarding the construction sub-sectors. Housing starts, for example, have been trimmed slightly compared to forecasts released earlier in 2014."
While single-family housing starts are not reaching projected levels, the report indicates a new emphasis on multi-family starts. Demographic trends and strict mortgage standards are pushing more potential homebuyers into rental units.
Additionally, the oil price environment has changed significantly since summer 2014 and these new impacts have been integrated into the forecast projections for the paving sector. Going forward, Sullivan noted that the underlying economic fundamentals are strengthening and are reflected in the labour market. Sustained gains in monthly job creation, stronger state and local tax receipts, more favourable return on investments for commercial building and stronger household formation can lead to stronger construction spending in 2015.
Security issues hit Eastern Cement production in Yemen
28 November 2014Yemen: Eastern Cement had its fuel and raw materials supply for clinker production interrupted due to escalating security and political turmoil. The supply problems have been solved and clinker production processes have returned to normal, the Saudi Arabian cement producer confirmed.
The sale of cement by Arabian Yemen Cement Company, in which Eastern Cement controls a stake of 32%, has continued without disruption as the company has sufficient reserves of clinker. Arabian Yemen Cement Company, based in Hadhramaut province, was founded in 2004. The company's cement factory with production capacity of 1.5Mt/yr is the largest Saudi investment in Yemen.
Mika Cement stops production until 2015
12 November 2014Armenia: Mika Cement has stopped production at its cement plant until February 2015. It reported to local media that it had produced the necessary volume of cement for sales and had now stopped for annual technical work. The company also said that it had paid the bulk of wage arrears and that the remaining debt will be paid before the end of 2014.
"The company repaid the biggest part of the arrears of wages to workers. In the period of the plant's suspension, the workers will be receiving salary in line with the legislation of the Republic of Armenia," said Mika Cement's press office.
Previously plant director Naira Martirosyan told Arminfo that the plant would produce 100,000t of cement by the end of 2014. The plant resumed production in September 2014 when salary and electric debts were settled. Production volumes at Mika Cement declined following the global economic recession in 2009. Although the company didn't publish financial results in 2013 its debt rose to over US$5.5m in 2012.
Is capacity reduction the next step in Vietnam?
10 September 2014There were two telling stories from Vietnam this week that show the level to which demand has been overestimated in the centrally-planned cement sector. Firstly, the country reported that exports in the period between January and July 2014 increased by nearly a quarter year-on-year to 13.1Mt. Secondly, the Prime Minister announced that another five cement plant projects were to be axed, following nine others that bit the dust in 2013.
All this is against a backdrop of chronic lower-than-expected domestic cement demand. When we look at the figures, it’s not hard to see that domestic consumers have had trouble consuming all the cement produced in Vietnam. The government forecast for cement production in 2015 is in the region of 75 - 76Mt. If this was spread evenly between Vietnam’s 88.8m people, each person would have to consume ~850kg of cement. That’s possible but it is quite a lot for a lower middle income economy. However, separate reports state that a 10% rise in domestic sales on 2013 levels would lead to just 60Mt of domestic cement sales in 2015. This equates to a more realistic 675kg/capita.
These figures leave a massive and increasing amount of cement for export. Read again that figure from the first seven months of 2014 – 13.1Mt – Roughly the capacity of South Africa (~12.5Mt/yr), Tunisia (12.9Mt/yr) of Colombia (12.9Mt/yr)! Also, while cement exports volumes were up by nearly a quarter, the value of those same exports rose by only 20%. This indicates a drop in export prices and represents additional pressure to halt capacity expansion.
Against a backdrop of 90Mt/yr expected capacity in 2015 and falling export prices, the latest cement project cull certainly makes sense but even in a best-case scenario the country is looking at a capacity utilisation rate of just 66 - 67%. Some cement plant project owners have even found themselves trapped by the situation. Having indebted themselves on the promise of ever-increasing cement demand, they now face the prospect of throwing good money after bad, continuing to build and operate just to service debts. This is a very unenviable position indeed. The lifting of trade restrictions within the ASEAN Community on 1 January 2015 might help export volumes, but might also also drive prices down further.
Culling new cement plant projects is one thing, but could the next step be more drastic? North of the border, China is gradually reducing its overcapacity by removing older and less efficient capacity. Perhaps Vietnam would do well to follow suit.
Vicem cement output rises 4.7% in year to date
20 August 2014Vietnam: State-owned Vietnam Cement Industry Corporation (Vicem) produced 10.2Mt of cement in the first seven months of 2014, a 4.7% increase compared to the same period of 2013. Vicem's clinker output, however, dipped by 1% year-on-year to 9.43Mt. In July 2014, Vicem's cement output rose by 7.8% year-on-year to 1.54Mt, while clinker output rose to 1.47Mt, a 8.1% rise.
In the first seven months of 2014, Vicem's total clinker and cement sales rose by 7% year-on-year to 12.7Mt, including 1.88Mt in July 2014, a 3.9% fall year-on-year. Of the total, 10.6Mt of cement and clinker were sold in Vietnam, down by 7.7% year-on-year. 2.12Mt were exported, an 86% rise year-on-year.
China: Xinjiang Uyghur Autonomous Region in northwest China saw cement production fall by 14.4% year-on-year to 12.8Mt in the first half of 2014, the local administration of building materials has revealed. Cement sales dropped by 13% to 12.6Mt during the same period.
Meanwhile, the region produced 13.5Mt of clinker in the first half of 2014, a rise of 10.5%. At the end of June 2014 clinker inventories totalled 9.04Mt, an increase of 75.5%.
Tajikistan aims to double cement production in 2014
16 July 2014Tajikistan: Tajikistan generated 496,600t of cement in the first six months of 2014, according to the Ministry of Industry and New Technologies. Tajikistan reportedly generated 385,000t of cement in 2013. The country is now intending to double its annual production of cement in 2014.
In September 2013, the Yovon cement plant (Huaxin Gayur Cement Co Ltd) started operation. It has reportedly produced 362,800t of cement in January - June 2014. This was over 70% of the overall volume of cement produced in Tajikistan in the first half of 2014.
Other cement plants in the country include the Tajikistan - China joint venture, Yovon cement, with a cement production capacity of 1Mt/yr. OJSC Tojikcement (Dushanbe cement plant) produced 101,600t of cement in the first half of 2014.
Vietnam: Vietnam produced 29.5Mt/yr of cement in the first half of 2014, a year-on-year rise of 7%, according to the General Statistics Office. Notably in June 2014 cement production rose by 19% to 5.4Mt. In 2013, Vietnam's cement output hit 56.8Mt/yr.
Azerbaijan: Cement production has risen by 40% year-on-year to 1.1Mt for the first half of 2014. The rise has been attributed to the operations of the new market players in the country according to local media.
Cement imports into Azerbaijan by value have fallen by 19% to US$50m compared to a rise of 46% to US$61.5m of clinker and cement in the first five months of 2013. Imports are now expected to fall by 20% in 2014 and 2015.
In the whole of 2013 some 2Mt of cement was produced locally and 2.6Mt of clinker and cement was imported. Azerbaijan's three main cement producers, Holcim, Qazax Sement Zavodu and Norm, are planning to manufacture 4.5Mt in 2015. In addition there are approximately ten small producing companies in Azerbaijan.