Displaying items by tag: Republic Cement

Philippines: Chief executives from Eagle Cement, Taiheiyo Cement Philippines, Republic Cement, Cemex Philippines and Mabuhay Filcement have opposed government plans for a minimum requirement of pre-shipment inspection for cement imports. Instead they have called for a rigorous testing procedure for all cement coming from abroad to ensure consumer safety, according to the Philippine Star newspaper. In a letter Paul Ang, the chief executive officer (CEO) of Eagle Cement asked the government to draw up revised rules and guidelines on the issue for the cement industry. He also requested that the Department of Trade and Industry (DTI) and other agencies combat technical smuggling of cement.

In separate letters to the DTI, Taiheiyo Cement Philippines president and CEO Satoshi Asabi, Mabuhay Filcement CEO Enrison Benedicto, incoming Republic Cement president Nabil Francis and Cemex Philippines president Ignacio Mijares also argued against pre-shipment inspection in favour of testing imports upon arrival in the country.

Philippines: Three of the Philippines' largest cement manufacturers have offered to waive their exemption from inspection procedures for cement imports, which are currently required only from companies that just import cement. They sent a joint letter to the Trade and Industry Secretary Ramon Lopez via Ernesto Ordonez, president of the Cement Manufacturers Association of the Philippines on 24 August 2017. In the letter, Taiheiyo Cement, Cemex and Republic Cement state that they are willing to undergo the same shipment inspection procedures as the traders. Ordonez said the offer was aimed at fostering industry harmony and ensuring adequate supply for the Duterte government's infrastructure push.

However, Atty Vic Dimagiba, president of consumer group Laban Konsyumer, said it was misleading for Ordonez to say that the cement firms have offered to waive their import shipment privilege because the Bureau of Product Standards of the DTI has already come up with a draft Department Administrative Order that will require all cement importers to undergo inspection procedures regardless of the company’s status. Existing legislation had come under fire as it allowed double standards.

Philippines: The Philippine Competition Commission (PCC) expects to complete an investigation in alleged violations of competitive practice by the cement industry by 2019. PCC commissioner Stella Quimbo made the comments at a forum on the Philippines Competition Act (PCA), according to the Philippines Star newspaper. The investigation follows a probe earlier in 2017 in which the commission says it found reasonable grounds to proceed based on allegations made by the former trade undersecretary Victorio Dimagiba. According to a legal statement made by Dimagiba, the Cement Manufacturers Association of the Philippines (CEMAP), led by its president Ernesto Ordonez, Lafarge Holcim Philippines and Republic Cement and Building Materials violated the provisions of the PCA by engaging in anti-competitive agreements.

Philippines: Republic Cement has released more information about its US$300m investment programme to increase its production capacity. The joint venture from Ireland’s CRH and Aboitiz Equity Ventures plans to increase the capacity of its plants at Luzon and Mindanao by 2019 in the first phase of the project, according to the Manila Bulletin newspaper. This will then be followed by a second phase that will build new clinker production lines.

Little additional detail was released but the cement producer intends to install several grinding mills to increase its cement production capacity by 3Mt/yr. In addition it will install improved process technology to increase clinker output from all of its plants in Luzon that it says will be equivalent in capacity terms to a new kiln line investment.

Philippines: Republic Cement & Building Materials has approved a five-year capital expenditure programme to increase its clinker and cement production capacity to meet local demand. One of the cement producer’s owners, Aboitiz Group, announced that it was making the investment to take advantage of infrastructure development plants by the Duterte administration, according to the Philippines Star newspaper. The upgrade is expected to increase the company’s production capacity by 1Mt/yr from its current level of 7Mt/yr. The investment will be spent on both production efficiency improvements at existing plants and by building a new kiln.

The Philippines has been messing up the balance sheets of cement producers so far in 2017. Over the last week Holcim Philippines, CRH and Cemex have each reported lacklustre first quarter results dragged down by poor performance in the country. CRH’s chief executive officer Albert Manifold seemed to receive the worst kicking when analysts in a conference call refused to let it pass that the company’s sales had dropped by 12% year-on-year in Asia. Although to be fair to him the group’s Asian division only represented 2% of global sales at Euro0.5bn…

CRH’s quarterly financial reports tend to be in the form of sparse trading updates. So this lack of detail and CRH’s plans to invest over Euro300m in the market may have prompted Manifold’s grilling. According to the Irish Times he blamed the situation on cheap imports from south-east Asia pulling down the price. He then defended the investment on the grounds that local producers would have an advantage as they increase production capacity due to constant production and ‘guaranteed’ regulation and certification.

CRH isn’t the only organisation that has been burned by the Philippines. Before Christmas this column was praising the local industry for being in a boom. Cement sales had risen by 10.1% year-on-year to 20.1Mt according to CEMAP data in the first nine months of 2016 and the Duterte Infrastructure Plan was starting to target hundreds of billions of US dollars towards infrastructure spending. In the end cement sales rose by 6.6% to 26Mt for the full year in 2016 and this was a solid performance despite being brought down by the fourth quarter.

From the cement producers mentioned above, Cemex reported that its Ordinary Portland Cement sales volumes fell by 9% in the first quarter. It blamed the fall on bad weather and a tough quarter to compare against in 2015. Holcim Philippines said that its net sales fell by 12% to US$176m and it attributed it to lower public infrastructure spending, tighter industry competition and higher production expenses. Eagle Cement meanwhile, the fourth of the country’s major producers, is preparing to float on the local stock market in May 2017 to fund an expansion drive. The poor results of the other three cement producers may dent its proceeds from the initial public offering (IPO).

The words CRH’s Albert Manifold used in his defence were that, “Brand matters over there.” Funnily enough the other big Philippines cement industry news story that has been rumbling away for the last few months is an investigation by the Philippine Competition Commission (PCC) into the conduct of the Cement Manufacturers Association of the Philippines (CEMAP) and some of the leading cement producers. Naturally this includes CRH’s joint venture Republic Cement. The enquiry was prompted in mid-2016 by the accusation of anti-competitive agreements by a former trade official. He also made direct allegations against Ernesto Ordonez, the head of CEMAP. The investigation is on-going and perhaps it will find out exactly how much ‘brand matters’ in the Philippines.

Philippines: Arsenio Balisacan, the chairman of the Philippine Competition Commission (PCC), says that the commission has 90 days in which to conduct an investigation into the local cement industry. It is expected to complete its probe in the first half of 2017, according to the Manila Bulletin newspaper. The investigation period follows the point at which the PCC found reasonable grounds of alleged violations of competitive practice. Potential fines the local industry could face are US$2m for a first offence and US$5m for a second.

The PCC announced in early March 2017 that was preparing to investigate the cement sector for alleged violations of competitive practice following a legal statement by Victorio Dimagiba, the head of Laban Konsyumer – a consumer rights organisation, accusing the Cement Manufacturers Association of the Philippines (CEMAP), LafargeHolcim Philippines and Republic Cement and Building Materials of engaging in anti-competitive agreements.

Philippines: The Philippine Competition Commission (PCC) is preparing to investigate the cement industry for alleged violations of competitive practice. It says it has found reasonable grounds to proceed to a full administrative investigation on the cement industry for possible violations of Sections 14 and 15 of the Philippine Competition Act, according to the Philippine Star newspaper. This follows a legal statement by Victorio Dimagiba, a former trade undersecretary, in August 2016 accusing the Cement Manufacturers Association of the Philippines (CEMAP), LafargeHolcim Philippines and Republic Cement and Building Materials of engaging in anti-competitive agreements.

Dimagiba has accused the cement producers of striking illegal agreements including, “restricting competition as to price or components thereof or other terms of trade, abusing their dominant position by engaging in conduct that substantially prevents, restricts, or lessens competition, imposing barriers to entry, or committing acts that prevent competitors from growing within the market.” He has also alleged that Ernesto Ordonez, the head of CEMAP, has used the trade association to justify violating the Philippine Competition Act, as well as maintaining prices of domestic cement in the retail market ‘unreasonably’ high.

Ordonez responded to the claims saying that he was puzzled about the PCC’s decision and that CEMAP had not been informed about a preliminary inquiry.

Philippines: Republic Cement is expanding its grinding capacity by over 10% in anticipation of a rise in demand prompted by increased government infrastructure spending. Other planned upgrades include an improved dust collection system at the cement producer’s plant in Bulacan. The company is also considering building new cement plants. Company president Renato C Sunico made the comments to local press at a forum on social housing.

The government of the Philippines has cited public infrastructure as one of its general spending priorities, setting aside US$18.5bn, which is equivalent to 5.4% of gross domestic product, in 2017.

Philippines: Republic Cement has inaugurated its new cement grinding mill at its Norzagaray cement plant in Bulacan. The US$19m expansion will add 0.85Mt/yr of cement production capacity to the plant, according to the Philippines Star.

“This capacity expansion initiative reaffirms Republic Cement’s commitment to support our country’s growth through the provision of top quality cement and building materials,” said Renato Sunico, president of Republic Cement. The new mill will also decrease the plant’s energy consumption.

Republic Cement, formerly Lafarge Republic, is owned by a joint venture of Aboitiz Equity Ventures and CRH.