Global Cement Newsletter

Issue: GCW469 / 19 August 2020

Headlines


In case you missed it, last week we covered a news story about Taiheiyo Cement’s plans to step up its lithium-ion battery recycling business at its integrated Tsuruga plant. It’s the latest step in the Japan-based cement producer’s collaboration with recycling company Matsuda Sangyo. The work is timely given that electric cars accounted for 2.6% of global car sales in 2019 and this share is growing. Many of these electric vehicles use lithium-ion batteries and moving away from fossil fuel powered transport creates new problems such as how to manage old batteries that can no longer be used.

Figure 1: Lithium-ion battery recycling process by Taiheiyo Cement and Matsuda Sangyo. Source: Translated from Taiheiyo Cement CEMS technical magazine.

Figure 1: Lithium-ion battery recycling process by Taiheiyo Cement and Matsuda Sangyo. Source: Translated from Taiheiyo Cement CEMS technical magazine.

Taiheiyo Cement and Matsuda Sangyo have been working on their process since 2011. First, they dismantle the batteries to extract base metals and plastics. They then heat the batteries in a dedicated ‘roaster’ using waste heat from the cement production process, before crushing and sorting them to remove cobalt, lithium, aluminium and scrap iron. Hydrogen fluoride produced in this stage is sent to the kiln where it is detoxified by calcium. Remaining elements from the battery that are not reclaimed are then used as an alternative fuel by the cement plant.

Taiheiyo Cement says that its roasting equipment can process up to 10t/day but it’s difficult at this stage to assess what demand for this service they might encounter. If, one estimate of 2m/yr used lithium-ion batteries by 2030 is correct and Taiheiyo Cement’s processing rate doesn’t get much higher, then 500 cement plants could possibly solve this problem. Yet, Taiheiyo Cement and Matsuda Sangyo have made no mention of the economics of their process. Other recycling methods also exist and research into new ones is ongoing. Cement plants recycling batteries might be economic compared to these alternatives or it might not, only time will tell.

The wider point here is that here is yet another industrial and logistical process that can potentially be linked to cement production. It follows well known ones, such as using alternatives fuels or captive power plants, or more novel ones, such as CO2 or hydrogen networks. In each case the business of making cement changes as new methods are learned, new commodities are sought and new markets are connected. The cement company then has a choice about how involved it wants to become with each new process. The classic example here is the waste processing companies that surround co-processing, with some cement companies having their own dedicated subsidiaries, for example LafargeHolcim and Geocycle.

As it all becomes more complicated the role of a cement plant slowly becomes redefined. If a cement plant disposes of municipal waste and car batteries for its local community, generates electricity from its solar or wind plant for a nearby city and uses its CO2 to either produce biofuels, plastics or baking soda is it still just a cement plant? The pivot by building materials manufacturers in recent years from a focus on cement to concrete suggests that once the societal or economic conditions are right it could change. For the time being cement plants remain cement plants but give it a thought next time you buy a new car.


Turkey: Sabancı Holding has appointed Umut Zenar as the general manager of Çimsa following the departure of Ülkü Özcan. Zenar’s previous role as the general manager of Akçansa, a joint venture between Sabancı and HeidelbergCement, will be filled by Mehmet Zeki Kanadıkırık. The changes will take effect from the start of September 2020.

Zenar holds a Master of Business Administration (MBA) from Boğaziçi University in Istanbul. He started his professional career in 2003 as a Business Development Specialist at Zorlu Holding before joining Akçansa in 2004. After working in sales, marketing and business development roles he moved to Oyak Cement Concrete Paper Group in 2016 as a general coordinator before returning to Akçansa as its general manager in 2018.

Kanadıkırık holds a degree in mechanical engineering from Middle East Technical University in Ankara. He started his career worked for Çukurova İthalat, Brisa, Lubrekip, Kordsa and Tekstil Servis. In 2006 he became the Production Manager at Kordsa Turkey and subsequently became the Manufacturing Director of Kordsa Turkey, the Operations Director of Thai Indo Kordsa and the Chief Operating Officer (CEO) of Asia Pacific for Kordsa in 2015.


Australia: The SmartCrete Cooperative Research Centre (CRC) has appointed Warren South as its chief executive officer (CEO). He will join the cement and concrete research organisation in mid-September 2020 and lead the consolidation of its central services function, initially supporting the ‘Fast Start’ and Round 1 research projects. South joins the SmartCrete CRC following nine years as Director – Research and Technical Services with Cement Concrete and Aggregates Australia (CCAA).


Senegal: Sinoma subsidiaries Sinoma International Engineering and Sinoma Construction have signed a contract with Les Ciments Du Sahel for the upgrade of its 3.0Mt/yr Kirene cement plant in Dakar Region. The Euro245m contract stipulates that a new 6000t/day capacity cement production line will replace the plant’s old third line. Sinoma says that the new line will grind its first batch of cement from clinker in February 2022 and produce its own cement and clinker from October 2022. The group said, “We believe that the contract ought to present no significant challenge for the company.”


South Africa: PPC has delayed the publication of its annual results for the year to 31 March 2020 for a second time due to a “restructuring and refinance project.” It now expects to publish the results by late September 2020. It previously delayed reporting its financial results when the Johannesburg Stock Exchange allowed it to delay releasing the figures because of challenges created by the coronavrius pandemic. The cement producer also said it has found errors in its financial reporting for the year that ended in March 2019 due to mistakes made in valuing operations in Ethiopia and Zimbabwe and a miscalculation of the accounting of a foreign-exchange transaction in the Democratic Republic of Congo (DRC).

The group expects that revenue for the year to 31 March 2020 will decline by no more than 5% year-on-year from US$605m in the same period in 2019. Earnings before interest, taxation, depreciation and amortisation (EBITDA) are expected to fall by up to 20% from US$113m.

In an operational update for April to July 2020 the group said that it ramped up cement operations in May 2020 following the relaxation of coronavirus-related lockdowns in most of its territories. It attributed strong growth in cement sales volumes in June and July 2020 due to a reduction in imports as well as pent-up demand. Similarly, sales volumes were strong outside of South Africa, particularly in Zimbabwe and Rwanda, and in the DRC to a lesser extent.


Democratic Republic of Congo: Police are investigating the murder of a Chinese worker at the quarry of a cement plant that is being built near Kolwezi, the capital of Lualaba province. The employee of Carrilu was killed in an attack on the site by ‘bandits,’ according to the Agence France Presse. Two other people were also assaulted in the incident. Armed attacks against businesses and residents have been reported regularly in the region.

The Lualaba Carrilu cement and lime plant is a project being managed by China-based Zijin Mining Group. It is expected to start operation in autumn 2020.


Zimbabwe: The Environmental Management Agency (EMA) has ordered Lafarge Cement Zimbabwe to stop operations at its integrated Harare plant due to abnormal dust emissions. As part of the order the plant has been requested to notify local stakeholders and the community of any new developments or incident that may affect them, according to the NewsDay newspaper. It will also be required to report daily dust emissions readings to the EMA every two weeks.

The cement producer said it experienced an unexpected surge in dust emissions during a trial of using saw dust as an alternative fuel at the plant between July 30 and 1 August 2020. It added that immediate action was taken to control and contain the emissions and the incident was reported to EMA in line with regulatory requirements.


China: Tangshan Jidong’s net profit in the first half of 2020 was US$140m, down by 33% year-on-year from US$210m to US$246m. Cement sales fell by 14% to US$1.58bn from US$1.83bn, while clinker sales fell by 11% to US$218m from US$246m. The Hebei Province-based group attributed the sales fall to the effects of the coronavirus lockdown in early 2020.


Philippines: LafargeHolcim subsidiary Holcim Philippines says that it has partnered with digital news platform providers Pinoy Builders. The commercial partnership involves Holcim Philippines providing Pinoy Builders with its cement, concrete and health and safety expertise.

Marketing and innovation senior vice president Ram Maganti said, “The Philippines is a very digitally-savvy country and the majority of professionals in the Philippines' construction industry are millennials who are 'digital natives.' With its steadily-growing number of subscribers and followers, Pinoy Builders is helpful in our efforts in engaging and positively influencing the construction industry. We are excited in continuing to contribute to this platform to let Filipino building professionals know how our offerings and solutions can help them in their projects.”


Azerbaijan: Azerbaijan produced 1.56Mt of cement in the first half of 2020, representing a 2.7% year-on-year decline from 1.60Mt in the half of 2019. Concrete sales increased by 6.5% to 0.83Mt from 0.78Mt, while the total value of construction materials sales fell by 4.8% to US$251m from US$264m.


Tunisia: The Ministry of Industry and Small and Medium-Sized Enterprises has issued a decree authorising the use of polypropylene cement bags, with the aim of increasing the competitiveness of Tunisian cement against rival Turkish products on the Libyan market. The Economiste Maghrebin newspaper has reported that the loss of a valuable exporter market following Algeria’s attainment of a cement surplus led the ministry to enact the cost-cutting policy. In January 2020, Algeria enacted a progressive prohibition on this type of packaging with a view to a blanket ban from 1 January 2021.

Minister of Industry and Small and Medium-Sized Enterprises Salah Ben Youssef says that his department “submitted a report on the impacts of the use of polypropylene packaging for cement to the Ministry of the Environment in May 2020 and received no reply,” but implemented the initiative because it was the only viable alternative to kraft bags, which he says are “overpriced due to monopolies in raw materials and assembly.” Ben Youssef said that polypropylene bags, which are permitted for use in food, lime, animal feed and fertilisers packaging, are “both recyclable and reusable,” and would enable the Tunisian cement industry to become self-sufficient in serving its bagging needs. As a further cost-cutting measure, Ben Youssef proposed that the government establish a solar power plant in order to reduce cement companies’ total energy bills by US$5.13m/yr.

The 16Mt/yr-capacity Tunisian cement sector, which includes international companies such as Carthage Cement and Brazil-based Votorantim Cimentos subsidiary La Cimenterie de Jbel Oust, produced 11Mt of cement in 2019 against a domestic demand of 7.0Mt.


Brazil: Votorantim Cimentos recorded a loss of US$94.0m in the first half of 2020, up by 99% year-on-year from US$47.2m in the first half of 2019. Sales fell by 8% to US$680m from US$739m. During the period Votorantim Cimentos and its subsidiary St Mary’s Cement increased the balance withdrawn from credit facilities by US$247m, in order to “strengthen liquidity as protection within the current crisis context due to the Covid-19 pandemic and to cope with the seasonality that recurrently affects North America.” The group says that it will reduce the value of its 2020 investments by 25% to US$545m from a planned US$726m, down by 6.3% year-on-year from US$581 in 2019.


Vietnam: Producers have reported a 5.4% fall in value of cement and clinker exports to US$732m in the first seven months of 2020 from US$774m in the corresponding period of 2019. Volumes increased by 11% to 19.5Mt from 17.6Mt. Dautu Online News has reported that Bangladesh, China and the Philippines were among import markets for Vietnamese cement.

The Ministry of Construction maintains its 2019 projection of 32Mt – 33Mt of cement and clinker exports in 2020.


Philippines: Aboitiz Group food and agriculture subsidiary Pilmico Foods says that it has developed a waste ash-based concrete mix that contains 20% less cement than its previous mix and that “can be used for all of the company’s construction needs.” The Manila Bulletin newspaper has reported that the ash is sourced from burnt rice husks, a fuel source for Pilmico’s food production and itself a by-product of its operations. Central Maintenance Department mechanical supervisor Michael Cayabyab said, “When we started using the biomass boiler almost two years ago, we saw process improvements and reduced costs. But in Pilmico, we know that the challenge does not stop there." The company has yet to commercialise the concrete, however it hopes to inspire others with its “demonstration of the circular economy demolishing the divide between industries.”


India: Birla Corporation has launched a promotional video entitled ‘Never Will I Ever’ that celebrates the idea of home as somewhere with room for everyone. The video, launched to coincide with Independence Day, consists of inspiring coronavirus lockdown stories. Marketing vice president Suvadip Ghosh Mazumdar said, “Construction is not only about brick and mortar. In the last few months, we have seen many occasions of relationships being built and bonds of togetherness being created. The film is our salute to this spirit of togetherness and coming together of people."


Mexico: Cemex says that 70,000t of its concrete has been used in the construction of Park Garage, a 10,000 vehicle-capacity multi-storey car park in Heroica Veracruz, Veracruz State. The company used a 500m3/day Vince Hagan batching plant and 12 mixing trucks to distribute concrete throughout the complex. Mexico regional president Ricardo Naya said, “We supplied specialised high-resistance concrete to counteract the severe salinity conditions that prevail due to the edifice’s proximity to the sea. Park Garage is yet another example of our ability to offer the highest quality products and services designed to meet our customers’ most demanding requirements."


India: State-owned energy supplier NTPC Limited has announced the shipment of 3450t of fly ash from its 3.0GW Rihand power station in Uttar Pradesh to Switzerland-based LafargeHolcim subsidiary ACC Cement’s 3.0Mt/yr Tikaria grinding plant, also in Uttar Pradesh. The Orissa Diary newspaper has reported that the shipment – the first from a new purpose-built rail depot – over 458km is part of NTPC Limited’s commitment to 100% total fly ash utilisation, up from 73% in the 2020 financial year, ended 31 March 2020. ACC supply chain head Suresh Rathi said, “This will pave the way for efficient and safe transportation of all fly ash from power plants to cement production units located at a distance in larger quantity.”

NTPC Limited generates some 60.5Mt/yr of fly ash alongside 62.9GW of power.


Saudi Arabia: The 25th Arab International Cement Conference and Exhibition (AICCE) in Riyadh, Saudi Arabia, has been postponed from 1 – 3 December 2020 to a later date to be announced in due course. The cause of the postponement is the impacts of the coronavirus. Arab Union of Cement and Building Materials secretary general Ahmad Al-Rousan said, “For health and safety reasons for all delegates, exhibitors, and speakers, and in order to provide all participants with a reliable basis for planning, we see this rescheduling of the event as the most responsible conclusion.”


India: Low demand for power due to the 25 March 2020 – 31 August 2020 nationwide coronavirus lockdown has caused Shree Cement to suspend some of its power plant operations due to a lack of buyers. The Business Standard newspaper has reported that 300MW of Shree Cement’s 650MW power generation capacity produces power for sale to other users on the national grid. Joint managing director Prashant Bangur said, “Owing to the lockdown, power demand was impacted and some of our power capacities were shut. Power demand has not completely recovered yet. Right now, power plants are shut because there is no demand; viability is the second part.”

The first stage of lifting lockdown was announced on 1 June 2020.


Germany: ThyssenKrupp has announced the launch of the HPGR Pro, a high-pressure grinding roll for raw materials processing that it says “offers up to 20% more throughput, 15% lower energy consumption and 30% longer-lasting rollers” than previous models. HPGR global product manager Frank Schroers said, “We used our experience and what we learned from conversations with customers to introduce improvements that are unique in this market and make grinding much easier.” Laser monitoring keeps users constantly informed about the roller surface and helps predict the best possible time for roller replacement. “Our customers need no longer stop the machine as a precautionary measure, saving them valuable time. What’s more, as our specialists collect and process machine data, our customers can continually improve their HPGR’s operation and optimise throughput, energy consumption or machine availability in line with their specific targets,” added Schroers.


Turkey: Germany-based Körfez Engineering’s Körfez foundry in Dilovasi, Kocaeli Province, has announced that it is now exporting its cast steel products, including cement kilns, preheaters, clinker coolers and mills, to 70 countries spanning five continents. Exports account for 85% of sales. Foundry general manager Çağdaş Alan said, “We are proud to export to different geographies and to increase the number of countries we export to during this difficult period the world is going through. We hope to overcome this difficult period with the least loss for our business and the country.” He added, “We continue to invest in information technologies, develop our facilities in line with industry 4.0, and create a dynamic business environment with innovative trainings for continuous development of our expert staff.”


India: Aditya Birla subsidiary Grasim Industries recorded a loss of US$36.0m in the first-quarter of the 2021 financial year (1 April 2020 – 30 June 2020), compared to US$26.9m profit in the first quarter of the 2020 financial year. The company attributed this to a 61% year-on-year fall in sales to US$260m from US$668m due to ‘lower realisation and weak demand’ during coronavirus lockdown. Consolidated cement sales over the period were US$228m, down by 29% year-on-year from US$320m.


Uzbekistan: Uzbekqurilishmateriallari deputy chair Ulugbek Abrayev has said that Uzbek cement production capacity will total 20.0Mt/yr before 1 January 2021, up by 60% year-on-year from 12.5Mt at the start of 2020. Abrayev added that, due to growing demand, Uzbekistan will produce 14.5Mt in 2021, corresponding to 73% utilisation of projected capacity. A total of ten cement plant projects across eight of the country’s 12 regions are due for completion in 2020 and 2021.


China: China Tianrui Group Cement says that it has secured a loan worth US$14.4m. Reuters has reported that a Chinese bank granted the loan, which will support capital expenditure projects in the current fiscal year.


US: Mexico-based Cemex supplied 15,000t of cement to the Hartsfield-Jackson Airport in Atlanta, Georgia, for the construction of a 3770m runway and taxiway by McCarthy Improvement Company. Replacing an existing runway, the new runway is the longest at Hartsfield-Jackson, the world’s busiest airport.

Cemex USA president Jaime Muguiro said, “Infrastructure in the US needs improvements and updates so that Americans can remain connected and get where they need to go quickly, safely and efficiently. At Cemex, we are proud to securely support essential infrastructure projects that help achieve those goals and provide products that will enhance the experiences of travellers for years to come.”


South Africa: PPC has said that it may issue a rights offer for US$68.7m-worth of shares in order to raise funds to ‘repay and restructure debt locally and in other African markets, and to refinance after the economic effects of the Covid-19 pandemic.’ Pretoria News has reported that PPC has forecasted a 20% year-on-year drop in earnings in the year to 31 March 2020 due to ‘a slump in domestic demand and an influx of cheaper Chinese imports, even prior to lockdown.’


India: Aditya Birla subsidiary UltraTech Cement said that it will spend US$200m in capital expenditure (CAPEX) during the 2021 financial year, which ends on 31 March 2021. The plans consist of a capacity expansion to 118Mt/yr from 115Mt/yr, including the completion of the 4.0Mt/yr Bara grinding plant in Uttar Pradesh and 1.2Mt/yr-worth of brownfield projects in Bihar and West Bengal. Solar and wind power capacity will increase to 350MW from 95MW, while waste heat recovery (WHR) capacity will increase to 185MW from 118MW.

Chair Kumar Birla said, “While 2021 will be a challenging year, Birla remains confident that the economy will revert to the 6 - 8% growth trajectory in 2022.”


Russia: Eurocement subsidiary Kavkazcement produced 0.89Mt of cement in the first seven months of 2020, up by 10% year-on-year from the corresponding period of 2019. General director Nikolay Muradov said, “Despite the difficult epidemiological situation in the region and in the country, Kavkazcement ensured the stability of production processes and increased production. This was made possible by product quality control and systematic work aimed at increasing efficiency at all stages of production, introducing advanced technologies and the high-quality servicing of equipment.”


Russia: Vostokcement subsidiary Teploozorsky Cement has engaged FLSmidth to complete two hot kiln alignments at its integrated Teploozorsky Cement plant in Oblu, Khabarovsk Krai following inspections. Vostokcement said that the plant’s second and third rotary kilns will need to undergo the process of adjustments to their axis and axial balance, in order to eliminate stresses to the kiln body.


Dominican Republic: Domestic cement production declined by 24% year-on-year to 2.1Mt in the first half of 2020 from 2.8Mt in the first half of 2019, corresponding to 62% capacity utilisation. Domestic consumption over the period also fell, by 20% year-on-year.


Honduras: Cementos Argos subsidiary Argos Honduras has announced the launch of ECO Multipurpose, a 40% reduced-CO2 general use cement produced with energy from the company’s 8.5MW solar power plant at its 1.0Mt/yr integrated Piedras Azules cement plant in Comayagua, Comayagua Department. The product is “the first environmentally-friendly cement in Honduras,” according to the cement producer.

General director Gustavo Uribe said, “With this project we are leading the industry in the country and sowing the seeds of the future for construction in Honduras, which will gradually evolve towards the adoption of the global trend of sustainable construction. At Argos, we continually work on creating products and developing projects with a positive impact on the environment and society. As a company, we assume a commitment to the Sustainable Development Goals, prioritising climate change especially, and this product brings us closer to fulfilling that commitment.”