Displaying items by tag: Saudi Cement Co

Saudi Arabia: Cement sales increased by 12% year-on-year in the fourth quarter of 2024, reaching 14.87Mt, Arab News reports. Sales were primarily driven by domestic demand, which accounted for 96% of total sales. Exports contributed the remaining 4%, according to data from Al-Yamama Cement. For the full year, cement sales grew by 3.7% to 51.2Mt.

Al-Yamama Cement led the domestic market in the fourth quarter of 2024, with a 13% share and sales of 1.83Mt, up by 22% year-on-year. Qassim Cement, after acquiring Hail Cement, held an 11% share with 1.63Mt of sales. Yanbu Cement, Southern Cement, and Al Jouf Cement followed.

During the same period, Saudi Cement dominated in exports with 0.49Mt, representing 80% of total shipments and a 71% year-on-year increase. Clinker production grew by 7% year-on-year in the fourth quarter of 2024 to 14.9Mt, while clinker exports fell by 28% to 1.15Mt.

Amr Nader, CEO of cement consultancy A3&Co, said “These figures may not fully align with the anticipated surge in demand from ambitious infrastructure projects. Megaprojects such as NEOM, the Red Sea project, and FIFA World Cup-related developments require vast quantities of construction materials. The maximum anticipated demand in the next five years is 78Mt/yr.”

Eastern Province Cement said this week that it had awarded a new production line project to Sinoma CDI. The subsidiary of China-based CNBM Group and Sinoma International Engineering has picked up the contract to build a 10,000t/day plant from design to installation at the cement producer’s Al Khursaniyah plant. Word on project finance is to follow later and the contract should be signed by the end of March 2024. The cement company last mentioned the project to the Saudi Exchange back in March 2023, when it suggested that it was focusing on upgrading existing lines at its Al Khursaniyah plant rather than building a brand new clinker plant at Najibiyah. The plans for the latter project date back to 2015. Eastern Province Cement holds limestone extraction licences in both locations.

It is worth noting that the last couple of new conventional production line projects announced in Saudi Arabia have been picked up by Sinoma International Engineering and related companies. Sinoma International Engineering won an engineering, procurement and construction (EPC) contract to build Southern Province Cement's upcoming Jizan cement plant in May 2023. This followed the awarding of a new 10,000t/day line by Yamama Cement, also to Sinoma International Engineering, in November 2022. However, Germany-based IBAU Hamburg was confirmed by Hoffmann Green Cement Technologies (HGCT) in September 2023 as being the company that would build a ‘clinker-free’ cement plant in Saudi Arabia in 2024. This will be a copy of HGCT’s H2 plant in France, which uses a combination of activated clay, ground granulated blast furnace slag (GGBFS) and gypsum to manufacture its products. HGCT has signed a deal with Shurfah Group to build several Hoffman plants under a 22-year exclusive licensing agreement.

Arguably though, despite all these new plant news stories, the bigger issue so far this year was Saudi Aramco's decision to raise its feedstock and fuel prices from the start of 2024. Several Saudi cement producers released warnings in response that production costs would rise and earnings would fall. Al Jouf Cement, Arabian Cement, Qassim Cement, Saudi Cement, Yamama Cement and Yanbu Cement each made statements to shareholders on the issue, saying that they were working out the impact, would announce what this might be when known and that it was likely to make a difference from the first quarter results onwards.

The timing of Aramco's price hike is poor given that after a tough year, with falling sales for some producers, demand was expected to pick up somewhat. Aljazira Capital, for example, in a cement sector report released in late December 2023, forecast a 3% year-on-year increase in cement sales volumes in 2024 following an estimated fall of 8% in 2023. Its reasoning was that the domestic housing construction market had declined in 2023, leading to high levels of competition in the central region of the country caused by high levels of company inventory. Looking ahead, the competition was expected to ease as more projects were generated outside the central region and demand from the country’s various large-scale infrastructure plans took off. We will have to wait for Aljazira Capital’s next report to find out how they think the market will cope with higher fuel costs, but it seems likely that business may remain tougher than expected for the cement producers in the short term at least.

Finally, one more story to consider is that Al Jouf Cement signed a deal with Rabou’ Al-Taybeh Company this week to export cement and clinker to Jordan. The initial period covers six months with the option for renewal. Up until 2022, at least, clinker exports from Saudi Arabia were growing most years since the export rules were relaxed in 2017. With a difficult market reported domestically in 2023, the appetite to focus on exports may be growing and this could be a sign of that. Another example this week of Saudi-based cement companies looking outside the domestic market could be detected when Northern Region Cement said it had sold a 49% stake in its Iraq business to Al-Diyar Al-Iraqia for Investments Company. The cement company said that the new strategic partnership would help it to further expand its investments in the promising market. It will use the proceeds of the deal to repay loans and for ‘external investments.’ It valued the transaction at just under US$44m. For more on what Northern Region Cement and others have been up to in Iraq, see Global Cement Weekly’s analysis from November 2023.

The steady stream of new clinker production lines suggests confidence in the cement sector in Saudi Arabia in the medium to long term. It is also fascinating to witness a secondary cementitious material plant like the one HGCT is planning on the way too. Unfortunately though, the recent fuel price rise looks like it might ruin the party in the short term for those hoping for better things in 2024.

The 26th Arab International Cement & Building Materials Conference and Exhibition takes place in Cairo on 15 - 17 January 2024. Visit Global Cement at stand N3

India: Toshali Cement has appointed Dhiren Nayak as its Vice President – Works.

Prior to this, Nayak worked as the plant head of an unspecified cement plant in Odisha in 2023, having earlier worked as a cement sector consultant. He notably held the position of Head of Operations at the Saudi Cement Company in Saudi Arabia from 2013 to 2019 and was a Technical Works Manager at Fujairah Cement Industries in the UAE from 2010. Earlier in his career he worked for FLSmidth, Lafarge Cement, Tata Steel and OCL India.

Toshali Cement operates an integrated plant at Ampavalli in Odisha and a grinding plant at Bayyavaram in Andhra Pradesh.

Saudi Arabia: Utilities provider Saudi Aramco has notified Saudi Arabian cement producers of a rise in the price of its feedstock and fuel products from 1 January 2024. Zawya News has reported that Saudi Kayan Petrochemical Company forecast the effect of the price rise to be a 1.2% increase in producers’ cost of sales in 2024.

Yanbu Cement said “The impact of changing the price of fuel products will lead to an increase in the cost of production.” Umm Al-Qura Cement echoed the concern, while Saudi Cement Company said that it is working out the extent of the financial impact and will study ways to mitigate it.

Saudi Arabia: Saudi Cement’s sales rose by 9% year-on-year in the first nine months of 2023, to US$288m from US$264m. The producer’s net profit also rose, by 13% to US$73.9m from US$65.1m.

Saudi Arabia: Saudi Cement recorded US$204m in sales in the first half of 2023, up by 15% year-on-year from US$177m in the first half of 2022. The producer reported a net profit of US$55.7m, up by 28% from US$43.6m.

Saudi Arabia: The General Authority for Competition (GAC) has fined 14 local cement producers around US$37m for price fixing. The companies were found to have broken local competition law following an investigation by GAC. They are now each liable for a US$2.7m penalty. The producers concerned are: Al-Safwa Cement; Al-Madina Cement; Umm Al-Qura Cement; Al-Jawf Cement Company; Qassim Cement; Najran Cement; Southern Province Cement; United Industrial Cement; Yamama Cement; Riyadh Cement (Saudi White Cement); Arabian Cement; Saudi Cement; Yanbu Cement; and Hail Cement.

UK: Neville Roberts, a former Technical Director of Cemex UK, has died on 10 February 2023, at the age of 66. He was a notable figure in the alternative fuels sector for the cement industry.

Neville attended Holyhead County School 1969 - 1975, taking Maths, Physics and Chemistry 'A' Levels, as well as representing the school in rugby, football and athletics. Roberts trained as a chemical engineer at Loughborough University and had worked in the cement industry for over 35 years. During his career he started as a process engineer, became a plant manager at a number of cement plants around the world including Chelm, Poland, and was appointed to five director roles for three cement companies. The companies he worked for included Rugby Cement, Castle Cement, RMC, Cemex and Saudi Cement Company. His later roles for Cemex included UK Technical Director (2004 - 12) and Energy Business Development Director (2012 - 13). He worked in the UK, Poland and Saudi Arabia. After leaving Cemex, Roberts set up his own consultancy and later became the managing director for the UK of Netherlands-based N+P Alternative Fuels.

He was a passionate supporter of all things Welsh, especially rugby, and was awarded the Global CemFuels ‘Personality of the Year’ award in 2013. Neville was husband to Patricia, father to Katie and Holly and grandad to Martha, Edie and Albee. He was known to his grandkids as 'Wowo.' Neville Roberts was great company, mentored and influenced many colleagues around the world and will be sorely missed.

UK: The World Cement Association (WCA) has appointed three new directors: Fabien Charbonnel, the chief executive officer (CEO) of Cem’In’Eu; Xu Gang, the chair of the board of Maweni Limestone and Vice President and Head of Overseas Area of its parent company Huaxin Cement; and Kevin Lunney, the chief operations officer of Mannok Holdings. The appointments were agreed at the WCA General Assembly Meeting, which took place in January 2023.

At the same time Mohammed Ali Al-Garni, the CEO of Saudi Cement, and Roland van Wijnen, the CEO of PPC, were re-elected to the board of directors. Vincent Lefebvre, the founder and executive chair of Cem’In’Eu, and Mahendra Singhi, the managing director and CEO of Dalmia Cement, have also resigned as directors. They joined the board of directors of the WCA in 2019 and 2020 respectively.

Saudi Arabia: Saudi Cement recorded sales of US$84m in the first quarter of 2022, down by 49% year-on-year from first-quarter 2021 levels. Its net profit in the quarter was US$16.3m, down by 49%.