Displaying items by tag: UK

UK: The Competition and Markets Authority (CMA) has published a final order affecting the suppliers of cement and cementitious products in Great Britain (GB). The order sets out these suppliers will be prohibited from sending generic price announcement letters to their customers. Instead, any price announcement letter will have to be specific and relevant to the customer receiving it, including setting out the last unit price paid, the new unit price and specific details of other charges that apply to the customer. The order is effective from 23 January 2016.

The order results from the Competition Commissions (CC) investigation into the supply or acquisition of aggregates, cement and ready-mix concrete in GB, which required Lafarge Tarmac to sell one of its cement plants and Hanson to sell one of its ground granulated blast furnace slag (GGBS) plants to enhance competition in the cement and GGBS markets. The CC also said that it would implement two further remedy measures aimed at reducing transparency in the GB cement markets, comprising a prohibition on generic cement price announcements and restrictions on the disclosure and publication of market data.

UK: Martin Riley has been appointed Senior Vice President of Tarmac. He will report to Ken McKnight, President Europe Heavyside. Riley was previously Managing Director, Aggregates and Asphalt at Tarmac. The appointment is part of the transition of the businesses acquired from Lafarge Holcim into the European Heavyside business of CRH.

In addition, the Tarmac Cement and Lime business will integrate into a new CRH business cluster consisting of UK Cement, Ireland and Spain, led by Oliver Mahon, Senior Vice President, who will also report to Ken McKnight. As part of this reorganisation the former CEO of Tarmac since 2013, Cyrille Ragoucy, will leave the business.

We're going to start 2016 with a list of some of the worst things that could happen to the global cement industry this year. The idea is taken from Bloomberg Business who ran 'A Pessimist's Guide to the World in 2016' in mid-December 2015. For some of these suggestions there will be both winners and losers. Remember: forewarned is forearmed.

Continuing low oil prices hit Russia and other petro-propped economies
Cheaper fossil fuels should mean cheaper energy bills for cement producers. However, that saving must be compared to the overall cost to the global cement industry of poor construction markets in Russia and other economies that rely on oil. For example, Russian construction output fell by 4.5% to US$81bn in 2014 according to PMR. It is possible that the fuels bill saving worldwide is greater than the contraction of certain construction markets. If it is though, is this a price that the cement industry is willing to pay?

China enters a recession
The long-expected Chinese 'hard landing' seems closer than ever, as economic growth slows. It hasn't happened yet (according to official figures at least) but the 7% drop in Chinese markets on 4 January 2015 gives observers the jitters. The financial reverberations from a full Chinese financial crash would be felt around the world, derailing emerging economies due to reducing demand for exports and commodities. Naturally, construction markets would suffer. This would add to the woes currently being experienced by Brazil, Russia and South Africa. The other worry for the cement industry specifically might be the complications from a desperate Chinese industry trying to flood the outside world with even more of its products and services, including lots of cement.

Climate change impacts cement plants
Normally when it comes to climate change the cement industry worries about the effects of carbon taxation and pollution controls. However, media reporting about flooding in the UK in late December 2015 and strong El Niño effects elsewhere makes a pessimist wonder about the effects of hotter and wetter weather upon the infrastructure of the industry. The cost to repair the flooded Cemex UK South Ferriby cement plant in 2014 was rumoured to run to Euro14m and production stopped for a whole year. Costs like these are something the industry could do without.

International sanctions remain in place for Iran
Hoping that lifting economic sanctions from Iran will boost the fortunes of multinational cement producers and equipment manufacturers may be wishful thinking. Yet if the sanctions stay in place due to deteriorating relations between Iran and Saudi Arabia then nobody can discover what opportunities there might be in the world's fourth largest cement producing nation. Of course Iran's geographical neighbours across the Gulf (and in Pakistan) might be hoping that the sanctions stay in place for a very long time indeed.

Sub-Saharan Africa builds production capacity too fast
Multinationals and local cement producers alike are scrambling to build cement plants in sub-Saharan Africa. Demand for cement and low per capita consumption suggest that it is a clear investment opportunity as development kicks in. However, we have already reported on scraps between local cement associations and importers from other continents. If the cement producers build capacity faster than these countries develop, then a crash can't be too far fround the corner and everybody loses.

The UK leads an exodus from the European Union
For the cement industry a UK exit, to be voted on later in 2016, from the European Union (EU) isn't necessarily a bad things. What would be negative though is a badly handled exit process as vast swathes of trade legislation is renegotiated. What a 'Brexit' might initiate are further exits from the EU, leading to further trade disruption on a larger scale. None of this would aid Europe's economic recovery in the short term.

US Presidential elections slow the construction market
Irish bookmaker Paddy Power is currently placing odds of 9/2 for Donald Trump to be elected the next US president in late 2016. He's the second favourite candidate after Hillary Clinton despite not even having been nominated as the Republican party's presidential candidate yet. Whoever becomes the next president, the political uncertainty that occurs as the election progresses may impact upon the US construction market. It would be unfortunate to discover that the sector is weaker than expected if, say, the election rhetoric turns nasty.

Next week: reasons to be cheerful.

Happy New Year from Global Cement!

UK: Lhoist has announced that its Thrislington lime plant in the north of England will be mothballed. The decision came on the back of the recent closure of steel manufacturing facilities in the UK, to which the Thrislington plant supplied the vast majority of its dolomitic lime. A total of 40 staff will now commence a collective consultation process with management via union and employee representatives.

"Unfortunately demand for dolomitic lime from our Thrislington plant has drastically reduced, since the closure of steel manufacturing plants in this region," said Cedric de Vicq, Managing Director of Lhoist UK. "We are looking at opportunities to retain staff where possible."

UK: Wastecycle's recycling facility in Colwick, Nottinghamshire is now one of the largest in the UK after an expansion of the site. By acquiring seven acres of property, which the company previously leased, and buying an additional four acres, Wastecycle has extended its site to nearly 20 acres.

"It's an exciting time for us because this expansion provides us with the platform we need to reach the next stage of growth as a company," said Financial Director Nathan Cole. "Over the long term, we plan to use the additional land to expand our extensive recycling and resource management activities. This will help us broaden the services we offer our customers while improving the quality and sustainability of the recycled products we manufacture."

The company has also completed an expansion of its main office to accommodate its growing workforce. After a 20% growth in staff 2015, it now employs almost 300 people across its Colwick site and its two sites in Leicestershire. "Ensuring our teams are comfortable in their working environments is very important to us because, not only does it increase productivity, but it also creates positive morale," said Cole. "Larger premises also provide the opportunity to open up new jobs, while improving the quality of service we can provide to customers."

Wastecycle separates 500,000t/yr of waste, including 18,000t/yr of recycling from 126,131 homes in the Nottingham City Council area. Some of the waste is turned into refuse-derived fuel (RDF) for use at cement plants. It also sorts through the rubbish of thousands of businesses across Nottinghamshire, runs a skip hire service and operates a wallboard recycling facility, which it developed with British Gypsum.

In 2014, Wastecycle's turnover increased to Euro42.8m from Euro35.9m in 2013. In 2015, it won four awards, including a bronze environmental best practice accolade at the Green Apple Awards in November 2015. It was recognised for the success of its wallboard recycling scheme, which has prevented more than 30,000t/yr of wallboard from reaching landfill.

UK: Breedon Aggregates plans to acquire Hope Construction Materials for Euro480m. In a statement, Breedon said that the transaction would create 'the UK's leading independent producer of cement, concrete and aggregates.'

Hope has 160 operational sites, including a cement works in Derbyshire, five quarries and 152 concrete plants. In the first six months of 2015, Hope sold 1.6Mt of cement, 4.7Mt of aggregate and 2.3Mm3 of concrete, generating revenue of Euro407m and underlying earnings before interest depreciation and amortisation of Euro52.8m.

The acquisition is conditional upon UK competition authority approval and is expected to be completed in the second quarter of 2016. "This acquisition is well-timed, with UK construction output forecast to expand by around 15% over the next four years and volumes of all our major products expected to grow strongly," said Peter Tom, Breedon Executive Chairman. "We are confident that we will be able to continue delivering significant value for our shareholders in the coming years, with an even stronger platform for growth."

The Chief Executive of Aggregate Industries, part of LafargeHolcim, Pat Ward, will take over as Breedon Chief Executive early in 2016.

UK: Hanson UK's CEO Patrick O'Shea will step down in December 2015 after eight years at the head of the construction materials business. He will be succeeded by Daniel Cooper, who is currently Northern Regional General Manager for Hanson Australia.

O'Shea joined Hanson plc in 1990 and held a variety of senior financial and operational roles before becoming Chief Executive of Hanson Pacific in 2001. In 2003 he added responsibility for continental Europe to this role, becoming Chief Executive of Hanson Continental Europe and Asia. He was appointed Managing Director of Hanson Aggregates UK in June 2004. When Hanson plc was acquired by HeidelbergCement in 2007, O'Shea was appointed CEO of the combined UK business, which brought together Hanson's aggregates and building products operations with HeidelbergCement's Castle Cement business, to form Hanson UK.
His tenure encompassed the longest and toughest recession ever experienced in the construction industry.

"It's not been easy, but I have enjoyed the challenge of leading the company through this difficult period and into a position where I believe we are well placed to take advantage of the opportunities which lie ahead,' said O'Shea. "I am confident that the company has a bright future and I look forward to watching it prosper and grow."

Daniel Cooper joined Pioneer Concrete in Australia in 1993. Hanson acquired Pioneer in 2000 and Cooper has held a number of operational, commercial and customer service management roles, including Regional General Manager for Western Australia.

UK: A pair of peregrine falcons nesting in a disused building at the former Westbury Lafarge Cement plant in Wiltshire will be protected even if the buildings are demolished, according to the Royal Society for the Protection of Birds (RSPB).

Owners of the site, Tarmac (now part of CRH), recently submitted a Prior Notification to Wiltshire Council to have the area demolished so that it could be used for other purposes. "We've worked with Tarmac nationally and we're working with them on this to ensure that the birds are not dramatically affected by any development work at the site," said Phil Sheldrake, a conservation officer from the RSPB. "They don't have a nest in the chimney, but they are nesting in another building on the site for the first time this year and have been roosting on the chimney. We have to make sure that if the buildings are demolished we can provide an alternative for them, such as a nest box that could be placed close to the site until a new building is built." Peregrine falcons are strictly protected under the Wildlife and Countryside Act after their numbers went into steep decline in the 1980s.

US/UK: Hanson Building Products has changed its name to Forterra following its recent divestment by HeidelbergCement. The rebranding brings with it a new logo to the established business, which has a trading history spanning back several decades, while its wide selection of products and services will be unchanged.

The company, which operates in North America and the UK, makes a diverse range of concrete and clay building products. Structherm, the subsidiary that specialises in external wall insulation, is unaffected by the rebranding. Forterra employs approximately 5000 people, 1600 of whom work in the UK in 18 manufacturing facilities and its new Northampton based head office.

"The Hanson name and logo may have been replaced by Forterra, but this is a change of branding only," said Stephen Harrison, UK managing director of Forterra. "We remain committed to the excellence and integrity recognised by our customers and the construction industry in general and we want to use this rebranding to reinforce our values. We will continue to be a leading building products manufacturer in the UK and a key player within the construction industry. As Forterra, our business enters an exciting new era."

The new name is effective immediately and will be implemented across the company's products, services and communications over the coming months. Company emails and web addresses will also change to reflect the Forterra name. The changes only apply to Hanson Building Products, while Hanson Cement, Hanson Quarry Products and Hanson Contracting will all continue to be part of Hanson UK, which remains within the HeidelbergCement Group. There will be no ongoing connection between Hanson UK and Forterra.

Denmark/UK: Vortex has appointed Mespo ApS as its exclusive agent in Denmark. Mespo sells high quality components, machines and customised solutions for powder handling manufacturers like cement producers.

"We are very pleased to add Mespo to our line of representatives," said Laurence Millington, Vortex's director of international business. "Mespo has a great cooperation with many manufactures of powder processing equipment around Europe. With its convenient location in Ringsted on Zealand, Mespo can respond to our Danish customer needs in a short amount of time."