Displaying items by tag: Votorantim Cimentos

Peru’s been the place over the last week with news reports of new production capacity and its targeting as a key export market by Vietnam.

Local press reported this week that three new cement grinding plants are planned to start production in 2019. Cemento Inka plans to build a 0.6Mt/yr grinding plant at Ica near Pisco. It also plans to upgrade the kilns at its plant at Cajamarquilla near Lima. Then Mixercon, a ready-mix concrete firm, wants to spend US$20m towards building two new plants in northern Lima, also in 2019. It also has plans to open distribution centres around the capital too.

For a local industry generally dominated by local often family-controlled producers this is quite a change. The larger companies – Pacasmayo, UNACEM and Yura – normally dominate the headlines and the market here. Unsurprisingly then that Pacasmayo and Yura also have upgrades planned for their plants in 2019 too.

Changes to capacity started in late May 2018 when Salaverry-based importer Invecem was said to be buying equipment for a 0.25Mt/yr grinding plant. Then things really started moving when Unacem bought Cementos Portland (Cempor), a joint venture between Chile's Cementos Bío Bío and Brazil’s Votorantim Cimentos. The foreign companies were planning to build a plant near Lima but the project was delayed by a legal battle over environmental issues intitiated by Unacem. This was followed by Cal & Cemento Sur (Calcesur), a subsidiary of Grupo Gloria, announcing that it was going to add a new production line to its cement and lime plant in Puno.

With this level of interest in grinding plants going on it’s unsurprising that Vietnam, a major exporter of cement, has taken an interest. Imports of cement to Peru rose by 65% year-on-year to 0.94Mt in the 12 months from December 2017 to November 2018 from 0.57Mt in the same period previously. Imports of clinker rose by 37% to 0.78Mt from 0.57Mt. This compares to a rise of 21% to 0.61Mt in cement imports in 2017 and a fall of 1.2% to 0.51Mt in 2016. In the 12 months to the end of November 2018 most of that imported cement (81%) came from Vietnam followed by 14% from China and 3% from Mexico. Clinker imports have been more varied with 39% from South Korea, 31% from Vietnam, 19% from Ecuador and 11% from Japan. The general situation for the clinker producers has been a slight increase in cement production to 10Mt for the 12 months to the end of November 2018 and slightly higher increases in despatches.

So, it looks like an apparent cement demand is up in Peru and the importers are rushing to meeting demand. The question, then, is why haven’t the clinker producers announced projects to squeeze out the grinders? As mentioned above Pacasmayo and Yura have upgrades planned but nothing really large seems to be coming yet. Also, given the tough time Cempor was given by the local companies what kind of opposition are the new projects by Cemento Inka, Mixercon and Invecem likely to face? The country’s gross domestic product (GDP) growth rate is below the glory days of the 2000s when it topped 6% but it is still one of the strongest in South America with 3.8% forecast for 2019 by the World Bank. This is the country in the region to watch in 2019.

Argentina: Aumund Brazil and Aumund China have collaborated with Sinoma Tianjin TDI to supply two clinker-conveying orders for cement plants. No value for either order has been disclosed.

Aumund will supply three chain bucket elevators, eight belt bucket elevators, five pan conveyors and a drag chain conveyor for Line 2 at Loma Negra’s L’Amali cement plant. The order also includes 19 silo discharge gates. In August 2017 Loma Negra awarded Aumund the order to build a second kiln line with a capacity of 5800t/day at the L’Amali plant in Olavarria in Buenos Aires province. The new line, which will produce 2.7Mt/yr of clinker, will be located adjacent to the existing kiln line. Production will start early in 2020.

In June 2018 Aumund Brazil worked with Aumund Brazil and Sinoma to supply four belt bucket elevators, three chain bucket elevators and three pan conveyors via Sinoma TDI to Cementos Avellaneda. Cementos Avellaneda is a joint venture operated by Brazil’s Votorantim Group and Spain’s Cementos Molins.

Spain: The regional government of Andalucia has fined Cementos Cosmos’ Córdoba plant Euro3000 for dust emissions in September 2016. The local environmental board criticised the subsidiary of Brazil’s Votorantim for only reporting the incident after the board contacted the plant about a dust cloud, according to the ABC newspaper. However, the fine was small because the dust pollution had no effects on the environment or local residents.

Brazil: Walter Dissinger has resigned from Votorantim Cimentos. He will be succeeded as chief executive officer (CEO) by Marcelo Castelli on 1 February 2019. Dissinger will assist the succession in early 2019.

Dissinger has led the company for over five years. He has left to seek new ‘challenges.’ Votorantim said that the years during which the company was led by Dissinger were marked by client-focused management, innovation and a digital transformation. Among other projects, Dissinger played a role in the creation of the first loyalty platform within the construction materials industry, Juntos Somos Mais.

Castelli is an executive with a career of over 31 years. In 1997 he started working at VCP (Votorantim Celulose e Papel). Since then, he has held several executive positions and coordinated the merger of Aracruz and VCP, which created Fibria. At the company, Castelli was the executive officer of different areas, such as Forestry, Paper, Strategy, Supply, and since July 2011 he has been the company’s CEO.

India: A report by the Cement Sustainability Initiative (CSI) shows that the local cement sector is on track to meet its 2030 targets from the low carbon technology roadmap (LCTR). Direct CO₂ emission intensity fell by 5% in 2017 in the Indian cement sector compared to the 2010 baseline. CO₂ emission intensity, including onsite or captive power plant (CPP) power generation, was reduced by 6.8% compared to the 2010 baseline. The alternative fuels thermal substitution rate (TSR) increased by 5 times from 2010 to 2017. The sector consumed more than 1.2Mt of alternative fuels in 2017.

“Sustainability is a journey, not a destination. In our globalised and interconnected world, no one can solve alone the challenges ahead of us and the only opportunity to succeed is through collaborative partnerships, where the common interests of all are considered as more important than the sum of individual interests. This is exactly the spirit that has animated the CSI’s low carbon journey since 1999. This flagship project - with its members - has developed, implemented and shared collective solutions for measuring, reporting and improving its greenhouse gas reduction performance, year after year,” said Philippe Fonta, managing director CSI.

The CSI and the International Energy Agency (IEA) worked with nine local CSI member companies - ACC, Ambuja Cements, CRH, Dalmia Cement (Bharat), HeidelbergCement, Orient Cement, Shree Cement, UltraTech and Votorantim Cimentos - to carry out the status review on the sector’s performance trends, continuous implementation measures and notable achievements based on the milestones set in the 2013 LCTR. The Status Review Report was developed in consultation with Confederation of Indian Industry (CII), with support from International Finance Corporation (IFC) and the Cement Manufacturers Association (CMA).

The findings of the report show that the direct CO₂ emission intensity was reduced by 32kgCO₂/t cement to 588kgCO₂/t cement in 2017 mainly due to an increased use of alternative fuel and blended cement production, coupled with a reduction in clinker replacement factor. However, the study also shows that significant efforts will be needed to meet the 2050 objectives of 40% reduction. The CO₂ emission intensity (including onsite or CPP power generation) has reduced by 49kgCO₂/t cement to 670kgCO₂/t cement in 2017 compared to the baseline year. The report has highlighted the adoption of waste heat recovery (WHR) systems by local cement plants.

The alternative fuels TSR increased to 3% in 2017 from 0.6% in 2010. More than 60 cement plants in India have reported continual usage of alternative fuels, with 24% of the total alternative fuels consumed as biomass. The share of blended cements used in the total quantity of cement manufactured increased to 73% in 2017 from 68% in 2010, largely due to the market’s growing acceptance of blended cement, emerging awareness of sustainability concepts, the availability of fly ash from thermal power plants and the use of advanced technology. The production of Pozzolana Portland Cement grew to 65% in 2017 from 61% in 2010. The share of Portland Slag Cement in cement production remained flat, at less than 10%, over the same period. The clinker factor reduced to 0.71 in 2017 from 0.74 in 2010.

In August 2018 the Global Cement and Concrete Association (GCCA) said it was taking over the work previously done by the CSI from 1 January 2019.

Brazil: Votorantim’s construction materials joint venture has started operation. The scheme, Juntos Somos Mais, is collaboration between Votorantim Cimentos, Tigre Participações and Gerdau Aços Longos. Votorantim holds a 45% share of the scheme. The joint venture will expand Votorantim’s Juntos Somos + scheme, which has been running since 2014. To date it operates in over 40,000 stores with over 60,000 registered participants.

Chief executives from over 30 companies attended the Global Cement and Concrete Association (GCCA) inaugural event last week in London. Its first president Albert Manifold, the chief executive officer (CEO) of CRH, laid out the line by saying that, “For the first time we have a global advocacy body.” He followed this up by emphasising that ‘our product’ is the most used man-made product in the world. Just like the Cement Sustainability Initiative (CSI), the body the GCCA is partly-replacing, it is a CEO-led organisation. The target is very much about giving a global voice to the cement and concrete industries and the vertically integrated companies that produce these products.

Along with the head of CRH, the leaders of LafargeHolcim, HeidelbergCement, CNBM, Votorantim, Buzzi Unicem and Eurocement, amongst others, were all on the attendance list too. That kind of representation gave the event a charged air and a real sense of intent. At present the association says it represents 35% of global cement production and its aim is to reach 50%. That compares to the 30% base that the CSI had.

Representatives from some major cement associations were also present, including Europe’s Cembureau, the Federación Interamericana del Cemento (FICEM), the Canadian Cement Association and the VDZ. The only thing stopping the US Portland Cement Association being there was reportedly the Thanksgiving holiday. Although not comprehensive, that kind of representation suggests serious interest from the regional cement associations. The word from the GCCA CEO Benjamin Sporton was that the GCCA is here to provide a global level of coordination to the advocacy and sustainability side of the industry dealing with global organisations like the United Nations (UN), development banks, other associations and non-government organisations (NGOs).

How this will work in practice has yet to be seen, but at the very least, the GCCA can take over the work of the CSI and run with it. The word from the attendees we spoke to was uniformly positive for the association. It was seen as a long-overdue move to finally give the industry some sort of uniform voice at a global scale. In this sense it is catching up with similar bodies in industries like wood and steel. One benefit from moving from the CSI to a full advocacy organisation is that the industry can actually talk about the good things it does rather than being limited to sustainability and environmental data reporting. It seems like a small change in focus but it’s a big shift in mind-set.

A cynic might suggest that the exercise is one of a dirty industry trying to wrest the Overton window, or window of public discourse, back from legislators facing mounting environmental pressure. The latest UN Emissions Gap Report for 2018, for example, reported this week that CO₂ emissions rose in 2017 after four consecutive years of decline. This is the latest environmental report in a long line pointing out bad news. Yet, the GCCA’s unwritten mantra, that concrete improves lives, is sound. Somebody or something needs to link it all up. That somebody might just be the GCCA.

A review of the inaugural annual general meeting and symposium of the GCCA will be published in a forthcoming issue of Global Cement Magazine.

India: Private equity company True North has signed a deal to buy Votorantim Cimentos’ direct and indirect 75% stake in Shree Digvijay Cement for an undisclosed sum. The acquisition will require completion of a mandatory open offer to the minority shareholders of Shree Digvijay Cement. JM Financial Limited is acting as the manager to the open offer.

“Votorantim Cimentos has contributed significantly to the strategic initiatives taken at Shree Digvijay Cement over the last few years. This has strengthened its competitive positioning and has greatly improved its operating and financial performance. True North firmly believes in Shree Digvijay Cement’s competitive positioning and is looking forward to partnering with the existing management and employees of the company. We are very excited about this opportunity, with fresh investment and new thinking we can create a lot of value for all,” said Said Srikrishna Dwaram, a partner with True North.

True North holds experience with investments in the Indian construction and building materials space. It has owned and managed two businesses in the sector: RDC Concrete, a manufacturer of ready-mix concrete and Robo Silicon, a manufacturer of construction aggregates.

Peru: UNACEM has purchased Cementos Portland (Cempor) for US$28m. It acquired a full stake in the company from Chile's Cementos Bío Bío and Brazil’s Votorantim Cimentos, according to Semana Económica magazine. Cementos Bío Bío and Votorantim originally planned to build a US$150m cement plant in Lima. However, this was delayed by a legal battle over environmental issues initiated by Unacem. The Peruvian cement producer operates an integrated plant in Lima.

Peru: Chile’s Cementos Bío Bío’s has sold its 50% share in Cementos Portland (Cempor) for US$14m. The cement producer originally purchased a stake in the company in 2010, according to the La Tercera newspaper. The Chilean company had previously intended to build a cement plant in Lima in a joint venture with Brazil’s Votorantim but this was delayed by legal opposition from Unacem.