Displaying items by tag: US

Switzerland/US: LafargeHolcim and GE Renewable Energy have signed a memorandum of understanding to research new ways to recycle of used wind turbines. The partners are seeking to use the shredded blades to produce low-CO₂ building materials. LafargeHolcim said that undertaking builds on the work of its subsidiary Geocycle, which previously began using GE’s waste wind turbine blades to produce alternative fuel (AF) for cement production. The cement producer called recycling the ‘key next step’ in line with the Circular Economy Action Plan of the European Union’s European Green Deal.

Little trickles of detail about the European Union’s (EU) proposed carbon border adjustment mechanism (CBAM) started to emerge last week. The key bit of information that Bloomberg managed to squeeze out of their source was that a transition period with a simplified system is being considered from 2023 and then a full version could turn up in 2026. Cement importers, and those in selected other heavy industries, would be required to buy electronic emission certificates at prices corresponding to those in the EU emissions trading scheme (ETS). Other titbits include: that the prices will be set on a weekly basis based on the average carbon permit price within the EU that week; a default value will be devised for importers who can’t back up their emissions data; and imports from a country with its own carbon pricing scheme will be entitled to a discount. The plans are due to be made public in mid-July 2021. Debate is then expected to follow before approval will be required from the European Parliament and member states.

The detail isn’t out there yet but the CBAM is set to collide with trade agreement territory. For example, how the draft agreement tackles issues such as exports from Europe and whether importers should be compensated for not receiving a free allocation of carbon credits could be seen to offer competitive advantage to one party or another. Climate policy will clash with trade policy once or if the CBAM makes in into law. At this point countries that import cement into the EU may start trying to negotiate or complaining to the World Trade Organisation. One previous example of climate policy bashing into trade agreements is when the EU tried and failed to apply the ETS to aviation in the early 2010s. The experience from this incident is expected to inform the European Commission’s approach on the CBAM.

Outside the EU, new carbon pricing schemes have been popping up all over the place and various cement associations are creating or refining their own carbon neutral plans. Last week in North America, for example, the Cement Association of Canada said it was working with the government on launching a roadmap by the end of 2021. In the US, the Portland Cement Association (PCA) has also been hard at work to publish its own roadmap by the end of 2021. Meanwhile, over in the oil sector there were a couple of victories for activist shareholders in May 2021 with Shell, Exxon Mobil and Chevron all being forced to make changes to their climate change polices by courts and activist investors. This makes one wonder how long it will be before the same thing happens to cement companies.

All this increases the pressure between trading agreements and climate legislation. One of the questions that has popped up at Global Cement’s webinar series has been whether attendees thought that a global carbon pricing and/or trading scheme might be a realistic position or not (the majority said ‘yes’ within 20 years). Yet the EU CBAM, all these sustainability plans and continued pressure by investor activist don’t happen in isolation. They occur in an interconnected world.

So it was both non-surprising and eye-popping to discover recently that a private carbon exchange is being prepared in Singapore for a launch by the end of 2021. Climate Impact X (CIX) is being backed by DBS Bank, Singapore Exchange, Standard Chartered and the Singapore-government owned investment company Temasek. As for which companies would actually voluntarily enter into a scheme that would actively reduce profits, the answer lies above. Any organisation looking to trade between carbon pricing jurisdictions might well have an economic incentive to find a truly international scheme that was reputable. Or, perhaps, a publicly owned company dealing in carbon-intensive products might be bullied into one by its activist investors. The focus on such an exchange being reputable is essential here, given the potentially large amounts of money that could be involved and the mixed views on existing carbon offsetting schemes. CIX says it will use satellite monitoring, machine learning and blockchain technology to ensure the integrity of its carbon credits and this is certainly thinking in the right direction. Until it arrives though, we wait to see the detail on the EU CBAM.

India/US: Mahendra Singhi, the head of India-based Dalmia Cement (Bharat), has been invited to represent the Carbon Pricing Leadership Coalition (CPLC) as Carbon Pricing Champion. He will work with Feike Sijbesma, Honorary Chair of Board of Royal DSM to devise carbon pricing strategies for the Asia-Pacific region

The CPLC is a global coalition promoted by the World Bank Group. It is represented by 34 national and sub-national governments, 172 private sector organizations 100 strategic partners non government organisations, business organisations, and universities. The voluntary initiative aims to accelerate climate change mitigation by securing the place of carbon pricing on the global agenda.

US: The Boston Globe newspaper has reported that the single biggest threat to the US government’s planned industrial reinvigoration based around a US$2.2tn federal infrastructure spending plan is a shortage of resources. The newspaper named a lack of workers and cement mills as particular concerns. It reported that the National Association of Home Builders has called for tariffs to be cut for certain key building materials such as lumber and that more cement should be imported.

US: Aggregate producer Vulcan Materials Company has agreed to buy US Concrete for US$1.29bn.The transaction has been unanimously approved by the boards of directors of both companies and is expected to close in the second half of 2021, subject to US Concrete shareholder approval, regulatory clearance and other customary closing conditions.

Tom Hill, Chairman and chief executive officer of Vulcan Materials Company, said, "US Concrete is an important Vulcan customer in a number of key areas, and this transaction is a logical and exciting step in our growth strategy as we further bolster our geographic footprint.”

US Concrete runs 27 aggregates operations serving California, Texas and the Northeast US. It shipped 12.6Mt of aggregates in 2020. Vulcan also said that the acquisition represented a ‘natural’ addition to Vulcan's business. The deal also adds US Concrete’s ready-mixed concrete operations to Vulcan's existing concrete business.

US: HeidelbergCement subsidiary Lehigh Cement and Keystone Cement have stepped away from an agreement to merge their businesses. The Federal Trade Commission (FTC) voted to challenge the proposed merger in late May 2021.

FTC Bureau of Competition acting director Maribeth Petrizzi said, “This is great news for cement customers in eastern Pennsylvania and western New Jersey. The FTC voted 4-0 to challenge this transaction because it would have reduced the number of significant competitors in the market for grey Portland Cement in this region from four to three. I’m grateful to the bureau’s staff for their tireless efforts throughout this investigation, but also to our partners in the Pennsylvania Attorney General’s Office, who worked closely with us to ensure that cement customers in this region will continue to benefit from competition between Lehigh and Keystone.”

US: Italy-based Buzzi Unicem subsidiary Lone Star Industries has concluded a settlement with the US Department of Justice, the Environmental Protection Agency and the state of Indiana over Clean Air Act violations at its integrated Greencastle plant in Indiana, dating from 2010 to the present day. The Indy Star newspaper has reported that under the terms of the settlement the producer must pay a fine of US$700,000. The authorities ordered the company to upgrade the plant in line with state and federal pollution regulations. The violations involved emissions of particulate matter that exceeded state and federal limits.

Cuba: Switzerland-based LafargeHolcim has agreed in principle to settle a US court case regarding alleged trafficking in private property previously confiscated by the Cuban government. The Miami Herald newspaper has reported that the group is preparing to pay the claimant compensation. In the complaint, the plaintiffs had claimed the current market value of the property was an estimated US$270m, plus legal fees, interest and other costs could be involved. An agreement is expected to be reached by late June 2021.

In late 2020 a court in Florida, US accepted a request for damages from LafargeHolcim to over 20 parties from Cuba whose land was nationalised and subsequently had a cement plant built on it. The claim alleged that Switzerland-based Holderbank had held a stake in the partly-state owned Carlos Marx cement plant near Cienfuegos since 2001. Holderbank later became Holcim and then LafargeHolcim. The plaintiffs have been aided by a change in US law allowing Cubans to claim damages in US courts for expropriated property from private companies which profited from them.

US: LafargeHolcim US has appointed Toufic Tabbara as the chief executive officer (CEO) of US cement operations. He succeeds Jamie Gentoso, who was appointed by Switzerland-based LafargeHolcim as Global Head, Solutions & Products Business Unit and a Group Executive Committee Member in March 2021.

Tabbara joined Lafarge in 1998, beginning his career in the gypsum division, followed by roles in ready mix concrete, asphalt and construction operations in the US and Canada. In 2012, he was named Country CEO for Jordan, responsible for ready mix operations, two cement plants and one grinding plant. Later, following the merger of Lafarge and Holcim, he became the Country CEO for Algeria, where he oversaw ready mix, aggregates, gypsum and cement operations, in addition to a central research lab.

He received his Master of Business Administration from the Thunderbird School of Global Management in Arizona and holds a Bachelor of Business Administration from the American University of Beirut, Lebanon.

Cuba: Cementos Cienfuegos’ Carlos Marx cement plant in Guabairo resumed production in late May 2021. Production had been suspended since 14 January 2021 due to a lack of petcoke, according to the Sierra Maestra newspaper. Fuel suppliers had been affected by a fuel shortage created by US trade sanctions. Despite the enforced shutdown the plant intends to meet its production target for 2021.