Spain: FYM-HeidelbergCement’s Málaga cement plant has temporarily ceased to produce clinker due to high electricity costs. The La Razón newspaper has reported that the effects of the Russian invasion of Ukraine have made clinker production economically unfeasible at the plant.

India: Employees of a contract firm working at Dalmia Cement’s Bokaro grinding plant in Jharkhand have allegedly killed a worker in an attack on 15 March 2022. The deceased’s roommate has also been missing since then. Both workers had been in trouble with their employer for refusing to work overtime. Operations reportedly continued as normal at the plant until other loading workers began a protest on 16 March 2022.

Dalmia Cement spokesperson Shyamlal Sahu said “The matter was brought to the notice of local police and they have started their probe. We are cooperating with them to bring the culprits to justice. We will work with the contractor – Durga Enterprises – to extend support to the bereaved family. We, at Dalmia Bharat, accord highest priority to maintaining internal harmony and a healthy working environment, and will work with our contractors towards ensuring that such untoward incidents do not happen in the future.”

India: The India Cements has launched Concrete Super King, a general application cement, and Halo Super King, a cement exclusively developed for use in the production of precast hollow dense concrete blocks.

Vice chair and managing director Narayanaswami Srinivasan said that many of the company’s customers already rely on its products in their precast hollow dense concrete block production. With the launch of Halo Super King, it hopes to further increase the ease of application.

Greece: Titan Cement recorded Euro1.71bn in net sales in 2021, up by 6.7% year-on-year from Euro1.61bn in 2020. The company attributed the boost to higher demand and ‘supportive pricing’ in all of its regions. Cement sales volumes were 18.3Mt, up by 7% year-on-year from 17.1Mt. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) dropped by 4.6% to Euro272m from Euro286m, due to an ‘unprecedented’ second-half costs increase. The group’s net profit was Euro89.6m, compared to Euro1.1m in 2020. During the year, Titan Cement increased the digitisation of its cement production and continued its on-going share buyback programme. Its Scope 1 and 2 CO2 emissions declined by 4% year-on-year, in line with its 2030 target trajectory.

Titan Cement said “Having already achieved the 2025 targets for energy efficiency and zero waste-to-landfill certification, the group’s attention is now focused on empowering business ecosystems to incorporate sustainability considerations in their decision making. To ensure that key suppliers meet the group’s environmental, social and governance (ESG) standards, Titan Cement developed a sustainable supply chain roadmap and published the first Titan Group Procurement Policy.” In the coming year, the group plans to ‘continue to harness the advantages offered by decarbonisation, digital transformation and business model innovation to benefit our customers, employees, suppliers and communities, aspiring to deliver to society carbon-neutral concrete by 2050.’

India: Shree Cement has fired up the kiln of a new clinker line at its Raipur cement plant in Baloda Bazar, Chhattisgarh. The Business Standard newspaper has reported that the company funded the project, involving the reactivation of the Raipur plant’s Kiln 3, from its internal accruals. It has also installed a new waste heat recovery (WHR) plant alongside the kiln. The line will augment Shree Cement’s supply of clinker to its grinding plants in Eastern India. It hopes thereby to contribute to growth and development in Chhattisgarh and beyond.

France: Lafarge France has announced a total planned investment of Euro46m in upgrades to its 1.6Mt/yr Saint-Pierre-la-Cour, Mayenne, cement plant and its 1.2Mt/yr La Malle, Bouches-du-Rhone, cement plant. The Holcim subsidiary will invest Euro40m to convert the Saint-Pierre-la-Cour plant to low carbon cement production. Meanwhile, it will invest Euro6m in the La Malle plant’s conversion to ultra-low carbon cement production. The L’Usine Nouvelle newspaper has reported that the transitions will complement the company’s strategy of over 25% EcoPact reduced-CO₂ ready-mix concrete sales by 2025.

Ireland: CRH says that it completed another phase in its on-going share buyback programme on 16 March 2022. The group purchased US$300m-worth of shares, bringing its total cash returned since the beginning of the programme in May 2018 to US$3.2bn. On 17 March 2022, it concluded an agreement to begin the purchase of a further US$300m-worth of its shares by 27 June 2022. The producer instructed investors that any decision in relation to any future buyback programmes will be based on an ongoing assessment of the capital needs of the business and general market conditions.

New Zealand: Holcim Australia and New Zealand plans to establish a new low carbon cement import and distribution facility next to its existing cement terminal at Ports of Auckland. The company says that the facility will have the capacity to replace 100,000t/yr of ordinary Portland cement (OPC) used in New Zealand. In 2021, the country consumed 1.6Mt of cement, generating 1.3Mt of CO₂ emissions.

CEO George Agriogiannis said “I’m pleased Holcim Australia and New Zealand is progressing to the building phase of a facility that will import and distribute low carbon cement replacement products. Once operational, the site will enable the reduction of carbon emissions via a cement replacement which can be used for applications such as infrastructure, commercial and residential projects.” He concluded “This initiative is a positive step toward the New Zealand government’s Zero Carbon ambitions and Holcim’s Net Zero climate pledge.”

Cement producers in the north of Pakistan have started to increase their use of coal from Afghanistan in response to the ongoing volatility in energy markets. Research from a report by Darson Securities found that companies were already using up to 70% Afghan coal in their fuel mix with a further 20% being considered. Most of the northern producers are reported to have secured the cheaper Afghan coal for about two months of inventory, although Maple Leaf Cement was said to have four to five months of inventory. Meanwhile in the south of the country, producers were reported to be facing a tougher situation as Afghan coal costs more for them due to higher logistics charges and export orders were being reduced due to the low cost of clinker internationally. So they are focusing on the domestic market instead.

Graph 1: Cement despatches in Pakistan, 2015 – 2021. Source: All Pakistan Cement Manufacturers Association.

Data from the All Pakistan Cement Manufacturers Association (APCMA) shows that cement despatches have been steadily growing since the mid-2010s with a blip in 2020 caused by the start of the Covid-19 pandemic. The upward trend has been driven by local sales. Exports have generally grown at the same time, with more variance, but they are yet to regain the high of nearly 11Mt reported in 2009. On a rolling annual basis, local sales have remained steady since mid-2021 but exports have been slowly falling. In April 2021 they were 9.17Mt but by February 2022 they were 7.33Mt. For the February 2022 figures APCMA blamed this on the growing cost of production, rising international freight rates, mounting coal prices and a trade ban with India. On that last point for example, Pakistan-based producers exported 1.21Mt of cement to India in the 2017 – 2018 financial year before exports stopped after February 2019. Despite a brief respite in the spring of 2021 talks are still ongoing to resume trade with India.

On the corporate side the country’s largest cement producer by capacity, Lucky Cement, drew the same conclusion as the APCMA with its half-year results to 31 December 2021. Its local sales volumes were down a little but its exports were down a lot. It noted that the reason its local sales were falling but national industry local sales were up slightly was due to some competitor plants being non-operational in the previous year. However, the company managed to keep sales revenue and earnings increasing year-on-year by successfully combating growing input costs with price rises. Bestway Cement, the country’s other large producer, reported a tougher situation in the second half of 2021, with both local sales and export volumes down. This was attributed to a boom in construction activity in the second half of 2020 as Covid-19 lockdowns were eased. Demand for cement since then was said to be ‘sluggish’ due to inflation and high commodity prices. It also pinned its marked fall in exports on political and economic instability in Afghanistan. However, turnover and operating profit were both up due to higher selling prices.

Elsewhere in the sector news since the start of 2021, Pakistan’s exports to South Africa remained stymied in early 2020 due to a review of ongoing tariffs and the government decision to restrict infrastructure projects to only using locally produced cement. On the sustainability front the APCMA started to set out its decarbonisation strategy in November 2021. It may have a long way to go given that a think tank reported earlier in the year that the cement sector was the largest emitter of coal-related CO₂ emissions in the country, even more than power generation. Alongside this plenty of capacity additions have been announced. Lucky Cement started commercial cement production at its 1.2Mt/yr integrated Samawah cement plant in March 2021. Various new cement plants and upgrades to existing plants have been proposed by Bestway Cement, Cherat Cement, Fauji Cement, Kohat Cement Company, Lucky Cement and Maple Leaf Cement. Finally of note to a sector troubled by energy prices, in September 2021 the Pakistan International Bulk Terminal said it was going to upgrade its coal handling capacity to around 17Mt/yr by 2024.

Last week’s Global Cement Weekly covered Turkey. The contrasts are interesting because both of these countries have high cement exports and have raised energy concerns recently. This leads to the question of whether other cement exporters may be vulnerable to the current situation. Pakistan isn’t the only country where the cement industry is facing the negative effects of growing energy costs. This week in the sector news, Spain-based Tudela Veguín has shut down the kiln at its La Robla plant down for 10 days due to high electricity prices, Thailand-based Siam Cement Group (SCG) announced it was reviewing its investment plans and the UK-based Mineral Products Association lobbied the government on the issue.

The shift to Afghan coal by Pakistan’s cement producers is rational given the current situation. No doubt fuel buyers all over the world are doing similar things. In January 2022 the International Monetary Fund (IMF) forecast that Pakistan’s gross domestic product would grow by around 4% for 2021, 2022 and 2023 but current geopolitical events may test these estimates. Over the last year domestic cement demand has remained strong but inflation, growing input costs and the impetus to further rise prices may change this. Meanwhile, lots of new production capacity is in the pipeline and, if or when it is built, it may add additional competition pressure. This may present a problem in Pakistan if capacity utilisation levels drop but input costs keep on going up.

China: Xiao Jiaxiang and Sui Yumin have resigned as vice-presidents from CNBM. Xiao Jiaxiang will continue to hold the post of executive director with the company. Both men also worked for subsidiary Xinjiang Tianshan Cement.