Displaying items by tag: US
PCA expects minimal cement growth until 2013
28 July 2011US: Despite recovery momentum in late 2010, the US economy is again in a slowdown, according to the most recent economic forecast by the Portland Cement Association (PCA), which says that the slowdown will weaken construction activity and restrain gains in cement consumption until 2013.
The PCA downgraded its cement consumption growth forecast to 0.2% for 2011, 0.4% in 2012 with a significant 16.4% increase in 2013. According to the report, uncertainty regarding highway spending legislation and government policy related to the debt crisis will cause a negative drag on construction activity for the next few years.
"Our previous forecast had assumed the new highway bill would be 20% higher than existing levels but we now believe the funding will remain at current levels," said PCA chief economist Edward Sullivan. "A lack of highway funding and reduced consumer, business and bank confidence due to the debt crisis will all slow down construction recovery."
According to Sullivan, economic recovery from the recession will be led by a strengthening of confidence in these areas. Without a sustained improvement, private sector fundamentals such as job creation, investment and ease in lending standards will not be released in full force and commit the economy to a path of improvement.
Efficiency improvements in the US
13 July 2011US: A Duke University study prepared for the US Environmental Protection Agency (EPA) has reported that the cement industry reduced its energy intensity by 13% between 1997 and 2007, averaging improvements of more than 1%/yr. These energy savings equate to a reduction of almost 1.5Mt of energy-related carbon. The study showed the gap between the best-performing cement plants and others narrowed and the performance of the industry as a whole improved.
"The decade studied by Duke was one of unprecedented growth for the cement industry, yet Portland Cement Association (PCA) members demonstrated their commitment to environmental stewardship by building sound strategies for energy management and investing in their facilities with state-of-the-art technologies that significantly improved the industry's energy-efficiency and reduced emissions," said Brian McCarthy, PCA CEO and president. "The US cement industry was among the first major industries to tackle the issue of climate change and this study illustrates that it has remained at the forefront of developing policies and improving the manufacturing process."
The study was commissioned by the EPA to measure the change in the cement industry's energy efficiency curve. The energy management approach promoted by the EPA's 'Energy Star' programme, which benchmarks plant energy performance against peers over time and certifies plants that achieve the best enviornmental performance, was an important factor in enabling the industry to improve its energy performance.
The Energy Performance Indicator (EPI) scores the energy efficiency of a single cement plant and allows the plant to compare its performance to that of the entire industry. The tool is intended to help cement plant operators identify opportunities to improve energy efficiency, reduce greenhouse gas emissions, conserve conventional energy supplies and reduce production costs.
US: Inaction by Congress to raise the federal debt ceiling could result in a second recession, adversely impacting cement consumption, according to a recent report by the Portland Cement Association (PCA).
The report says that inaction on the debt ceiling could cause derailment of the fragile US economic recovery. A federal default would have a severe impact on business, consumer and bank confidence, leading to a rise in interest rates. In addition, forced government austerity spending measures are likely. This could depress highway and other government construction programs at the federal and state level. This possibility could cause a great deal of further pain to the cement industry, because public construction projects account for 50% of total cement consumption in the US.
"In this scenario, cement consumption would record a 5.6% retraction in 2011 followed by a 7.5% drop in 2012," said Ed Sullivan, PCA chief economist. "In fact the debt crisis may already be exerting adverse influence on near-term cement consumption due to suspension of state and local treasury bonds as well as an overall uncertainty that has been injected into the economic landscape."
The PCA estimates that the cyclical downturn caused by the Great Recession has reduced federal revenues by USD1.9tn and raised income security payments like unemployment insurance by USD600bn. Aside from revenue and tax assessments, part of the increase in debt has been recorded due to necessary countercyclical spending such as the stimulus package. Defence spending in the Middle East has also contributed to the recent large deficits. The report says that finally (and perhaps most worryingly) deficits have come from increases in entitlement spending fuelled by demographic changes. The Congressional Budget Office expects entitlement spending on social security and the Medicare and Medicaid schemes will rise from USD1.5tn in 2010 to USD2.6tn in 2020.
The debt accumulation during the past four years actually exceeds the total debt accumulated since the country's inception.
Mexico’s Cemex cancels bond sale
07 July 2011Mexico: Indebted Mexican cement maker Cemex has cancelled its plans to sell USD650m in bonds as investors are worried about a global economic slowdown. Struggling with limited cash flow and a weak US market, Cemex aimed to raise money to help pay USD1.2bn in debt amortisations by the end of 2013 before being hit with an USD8bn payments bottleneck in 2014.
"Given market volatility and unfavourable performance of markets today, Cemex has decided to not pursue the transaction," the company said in a statement.
EPA rules to be discussed in October 2011
29 June 2011US: A federal appeals court has scheduled oral arguments for 11 October 2011 in pending litigation challenging EPA's air toxics and criteria pollutant rules for the Portland cement industry, giving activists a chance to argue for the inclusion of greenhouse gas (GHG) limits in the criteria pollutant rule and for industry to highlight what it says are major flaws in both rules.
The US Court of Appeals for the District of Columbia Circuit has scheduled oral arguments for the suits challenging EPA's new source performance standards (NSPS) for criteria pollutants and a maximum achievable control technology (MACT) standards for air toxin emissions.
The court recently granted the cement industry's request to sever and hold in abeyance several aspects of its pending lawsuits challenging key provisions of the two rules, following an agency decision to issue a partial denial and partial granting of several petitions for administrative reconsideration of the rules. The oral arguments will focus on suits challenging other provisions of the two rules. For example, the Portland Cement Association (PCA) and other industry petitioners will likely ask the court to vacate both rules due to what they say are numerous faults and errors in the final versions.
In the fight over the NSPS rule, industry filed a brief on 16 May 2011 taking issue with, among other things, the rule's new limits on particulate matter (PM) emissions, particularly its limit of 4.5g (0.01lb) of PM per tonne of clinker. Producers argue that the EPA 'simply adopted' the same PM limit that it set for the air toxins rule, at odds with Clean Air Act requirements for setting NSPS.
In their brief in the MACT suit (16 May 2011), the producers argue that the EPA failed to address the overlap between the cement rule and a recent EPA emissions rule for commercial and industrial solid waste incinerators (CISWI). On 21 March 2011 the EPA issued a memo trying to clarify the number of cement facilities that would be subject to the final CISWI rule but the producers said that the memo did not resolve their concerns and sought to have the question addressed through an administrative reconsideration of the rule. This request was subsequently denied by the EPA.
The PCA and others in the industry have also continued to express concerns over whether some cement kilns burning alternative fuels that may fall under a recent final EPA rule defining non-hazardous solid waste would fall under the cement MACT or under the CISWI rule issued in February 2011 and how that would impact on the MACT baseline emissions limits that the agency used when it developed the cement air toxins regulation.
The rules were amendments to existing NSPS and MACT standards for the sector and industry only wants the court to vacate the 2010 amendments and not the rules that were in place prior to the new rules. If the court vacates the amendments, the rules could revert to the older regulations, a cement NSPS set in 1988 and the MACT rules from 2006.
Environmentalists meanwhile will likely use the oral arguments to push their legal fight that is trying to have the court force the EPA to... ...include GHG limits in the cement NSPS. Environmentalists have filed briefs in the cement litigation arguing that GHGs meet the EPA's two-part criteria for determining whether to regulate new pollutants under NSPS. When the EPA issued the cement NSPS alongside an air toxins rule for the sector in September 2011 it said that CO2 standards 'may be appropriate' for the sector, but chose not to include GHG limits in the final rules, because it had not included GHG limits in the proposed version of the rule. The agency said that it needed, "additional information on site-specific factors that affect performance of these controls, where they are currently applied, and control costs," for reducing CO2 from the Portland cement industry. This is a point that environmentalists are disputing.
In a brief issued on 16 May 2011 Sierra Club, the Natural Resources Defense Council and others argue that the EPA's decision not to include GHG limits in the NSPS while saying such limits 'may be appropriate' for future action 'is particularly egregious' given that the EPA's findings in the proposed and final versions of the rule point toward inclusion of CO2 standards and that the agency has already determined that CO2 negatively affects public health.
Cementos Argos funds Ceratech
21 June 2011US/Colombia: Ceratech, Inc., a producer of alternative, non-OPC cementitious materials, has accepted another strategic equity investment, this time from Colombian cement powerhouse Cementos Argos. The Ceratech investment follows Argos' recent expansion of its US presence through a USD 760m purchase of Lafarge assets in the south east of the country. The strategic investment will help Argos meet its goal of building a competitive advantage based on sustainability and innovation.
Ceratech's manufacturing process produces technologically advanced, more durable, 'sustainable cements' comprising 95% waste fly ash generated by electric utilities. Its production does not generate any CO2 and the product is well-positioned for adoption by contractors, distributors and companies that are looking for new solutions that better conform to green building initiatives.
The two companies will cooperate to develop and distribute Ceratech's cement through Argos' established ready mix channels throughout the mid-Atlantic, southeastern and southwestern US markets.
"This strategic investment being made by Argos shows how important innovative, sustainable construction products are to the industry," stated Jon Hyman, CEO of Ceratech. "Ours is the only cement on the market composed of more than 90% fly ash. As the industry's only carbon-free cement, we exceed the requirements for green building practices such as USGBC's LEED rating system."