Global Cement Newsletter

Issue: GCW577 / 05 October 2022

Headlines


Cemento Yura said it was considering expanding cement and lime production this week. The announcement, made in an interview to business newspaper Gestión, follows a strong second quarter for the subsidiary of Grupo Gloria with clinker production volumes jumping up by 36% year-on-year to 0.51Mt. Overall for the half-year its clinker and cement production rose by 12.8% year-on-year to 0.86Mt and 12.7% to 1.47Mt. The success was attributed to consistent demand from the domestic sector as well as various large-scale mining projects. Julio Cáceres, the commercial director for its Cement, Concrete and Lime Division in Peru, Chile and Bolivia, wouldn’t say where the company was considering heading next, other than that remarking that it was attentive to new markets.

As Cáceres’ job title implies Cemento Yura also operates cement plants outside of Peru. At home it runs one integrated plant in the south of the country near to Arequipa as well as a lime plant at Juliaca. Outside of Peru though it also runs two integrated plants and a grinding unit in Bolivia, via its Sociedad Boliviana de Cemento (SOBOCE) subsidiary, and two integrated plants in Ecuador, via its Union Cementera Nacional (UCEM) subsidiary. The company also has assorted concrete assets. The international aspect to Cemento Yura’s business is interesting given that the larger cement producers in Peru are dominant in different parts of the country with Cementos Pacasmayo in the north, UNACEM (Unión Andina de Cementos) in the centre around Lima and Cemento Yura in the south. Notably, UNACEM also runs a plant in Ecuador and one in Arizona, US. It is also worth mentioning that competition issues have been reported in the local market previously. In mid-2021 Peru’s competition authority, the National Institute of the Defense of Competition and Intellectual Property Protection (INDECOPI), investigated Cemento Yura.

Cemento Yura’s rise in clinker production in the second quarter of 2022 is worth considering because in a previous interview with the local press Humberto Nadal, the chief executive officer of Cementos Pacasmayo, said that importing clinker had become more expensive in 2021. Subsequently, the company started a US$70m upgrade at its Pacasmayo plant to increase its production capacity by 0.6Mt/yr. In its second quarter financial results for 2022 Cementos Pacasmayo directly credited a 27% increase in its earnings on higher operating profits arising from decreasing costs by using less imported clinker. Sure enough data from Association of Cement Producers (ASOCEM) shows that both cement and clinker imports started to fall in October 2021 and have mostly followed a downward trend since then. Clinker imports fell by 41% year-on-year to 0.66Mt from January to August 2022 compared to the same period in 2021.

Graph 1: Cement production in Peru, 2014 – present. Source. Association of Cement Producers (ASOCEM).

Graph 1: Cement production in Peru, 2014 – present. Source. Association of Cement Producers (ASOCEM).

Looking at the wider picture in Peru, cement production has stayed fairly consistent since 2014 at around 10Mt/yr. An upward trend probably started in 2019 but then the Covid-19 pandemic cut it off in the first half of 2022 before the market surged back in the second half of that year. 2021 was a good year with production peaking at 12.9Mt. So far the first eight months of 2022 have seen production rise by 5.3% year-on-year to 8.64Mt.

In summary, cement production is rising in Peru, importing clinker appears to have become more expensive for at least one of the producers and some of the larger local companies are investing in new production capacity, considering it or thinking about acquisitions elsewhere. Local clinker producers appear to be in a good place; clinker importers, or those reliant on it, not so much.


Pakistan: Dewan Cement has appointed Hazrat Ali as its chief financial officer. He succeeds Imran Ahmed Javed in the role. The cement producer operates two plants.


Türkiye: Votorantim Cimentos Türkiye has appointed İlker Kutlu Yilmaz as its Head of Logistics. He previously worked as the Group Logistics Manager for Cementir Holding in Türkiye. Prior to this he also worked as a Logistics Manager for VICAT from 2012 to 2018. Other notable roles he has held include working in logistics for Feka Construction, Industry & Trade and Omsan Logistics.


Australia: First Graphene has appointed Lester Lee as its Commercial Manager – Cement & Concrete. Singapore-based Lee holds nearly 30 years of experience working in the cement and concrete industries. This includes management roles in Hong Kong and Singapore with multinational companies such as Fosroc Construction Chemicals, K Wah Concrete Company and WR Grace.

First Graphene is an Australia-based supplier of graphitic materials and product formulations to sectors including cement and concrete, composites and plastics, coatings, adhesives, silicones and elastomers (CASE) and energy storage applications.


Pakistan: Flying Cement plans to expand Line 2of its 1.2Mt/yr Lilla cement plant by 17% to 9000t/day. Mettis Global News has reported that the producer has already received clearance from the Punjab Environment Protection Agency for the expansion. The upgraded line will be operational from mid-late 2023.

Flying Cement will also establish a new 21MW captive power plant at the Lilla cement plant.


Philippines: Cemex Holdings Philippines subsidiary APO Cement has suspended operations at its 25,000 bag/day Davao cement terminal. The Philippines Star newspaper has reported that the cement producer and importer cited low sales volumes, along with high operating costs, as the cause of its decision. It added that an 'influx' of Vietnamese cement imports had precipitated the situation. Cemex's Philippines supply chain vice president Edwin Hufemia said that the suspension will allow the company to keep its focus on its cement plant and other facilities in the Philippines.

Hufemia said “We remain committed to supporting the country’s development programme and the administration’s Build, Better, More infrastructure programme, and we assure the public that there will be no disruption to the supply and delivery of our cement."


Brazil: Votorantim Cimentos has launched its new visual identity. Its new logo consists of a lime green and dark blue V, next to its name, with the Votorantim written in capital letters and the Cimentos in lowercase. The producer says that the V honours its legacy, while figuratively representing a movement toward the future. The colour and font combination embodies the company's solidity and flexibility.

Corporate communications and branding head Geraldo Magella said “Votorantim Cimentos is on a journey of evolution and transformation. We redefined our strategy, revised our culture, grew, expanded. This long-term vision opens new paths and new areas of activity through the development of products and services to meet the needs of society. We want to create changes while remembering our history - hence the need to translate all this into a new brand, which communicates everything we do, from ground level to the highest point in a city."


Saudi Arabia: Arabian Cement says it is considering how it can complete work on the construction of new cement mills at its integrated Rabigh plant. The announcement follows a statement from the cement producer reporting that contractor China National Building Materials Company (CNBM) said that it was unable to complete the project due to the necessity of “involving a third party.” The project has suffered repeated delays, such as Covid-19-related travel bans, and dates back to at least 2015.


Belgium: Holcim and TotalEnergies have signed a memorandum of understanding (MOU) to work towards the full decarbonisation of the Obourg cement plant. Various energies and technologies will be assessed for the capture, utilisation and sequestration (CCUS) of around 1.3Mt/yr of CO2 emitted by the unit. The project will include working towards building an oxyfuel switchable kiln as part of an upgrade project at the plant and the transportation and use of the captured CO2 by TotalEnergies for a synthetic fuel producing scheme and/or deposit in geological storage in the North Sea.

TotalEnergies will also assess the development of renewable projects to power a new electrolyser, which would generate the green hydrogen needed to produce synthetic fuels. This new renewable energy production capacity would also power Holcim’s new oxyfuel kiln. Finally, the oxygen emitted by the electrolyser would be used to fuel the new kiln.

Bart Daneels, the chief executive officer of Holcim Belgium said “Cement industry decarbonisation is extremely challenging because of the process's inevitable CO2 emissions, which put us firmly in the hard-to-abate sector. CCUS is vital for Obourg to become the first net carbon neutral clinker plant in northwest Europe. We are very happy to work with TotalEnergies to accelerate the development of these CCUS solutions for GO4ZERO. By joining the first movers, we want to set the standards for future clinker manufacturing plants.”


Finland: Energy provider St1 plans to establish a 25,000t/yr renewably powered synthetic methanol plant at Finnsementti's Lappeenranta cement plant in South Karelia. St1 hopes to develop a replicable and scalable synthetic methanol production concept at the site. When commissioned in 2026, the installation will create 20 jobs and produce synthetic methanol for use in maritime and road transport. The Finnish Ministry of Economic Affairs and Employment has granted Euro35.4m-worth of funding to the project.


France: SaintGobain and Ireland-based Ecocem have announced a partnership to bring low carbon cement products to market. Designed to reduce CO2 emissions from cement, mortar and concrete, these products are intended to support the acceleration of the construction industry’s transition to a low-carbon economy. A research and development cooperation between Ecocem and Chryso, Saint-Gobain’s construction chemicals subsidiary, is planned to accelerate the development of high-performance admixtures to enable low-carbon cements. This partnership will also cover Saint-Gobain’s mortar business Weber in Western Europe and the distribution and concrete manufacturing activities of POINT.P in France.

Donal O’Riain, the chief executive officer of Ecocem, said “The potential exists today to reduce cement industry emissions dramatically by 2030 and to align with the targets set by the Paris Accord. Ecocem’s new generation of scalable low-carbon cement technologies can deliver on this potential. Our deep partnership with SaintGobain will support our efforts to scale these technologies and demonstrate to the world how we can decarbonise the cement, concrete and mortar industries.”

Ecocem is producer of slag-based cement products with operations in Ireland, the UK, France and the Netherlands. Saint-Gobain holds a 25% stake in Ecocem and describes itself as a significant investor in the company for nearly 15 years.


US: Heliogen is among recipients of a total US$24m in US Department of Energy funding for solar thermal power projects. The department granted it US$4.1m-worth of funding for a project in which it will calcine limestone at 950°C using the heat of the Sun. Heliogen hopes to apply the methods it is developing to prevent the direct emissions of cement production.


China: China Building Materials Academy has patented a new 3D printing method which uses short rebars to reinforce printed layers. The developer says that this will enable builders to ensure structural strength without the disruption caused to 3D printing by the long rebars of conventional building skeletons.

China Building Materials Academy said that an 'inverted U-shaped or inverted L-shaped short rebar is vertically inserted into the cement slurry layer, wherein the bending mechanism comprises two bending members, separately disposed on two sides of a clamp.'


US: The US Department of Commerce has concluded a review of anti-dumping duties of imports of grey cement and clinker from Japan. The review established that the duties are necessary to the prevention of cement and clinker dumping. The department launched its review in June 2022, in line with legal requirements. Japanese cement and clinker have been subject to anti-dumping duties in the US since 1991.


Panama: Waste management company EMG has won a contract with Cemex Panama for the supply of solid recovered fuel (SRF) derived from commercial and industrial waste, beginning in early 2023. EMG is working to expand its SRF production capacity to 18,000t/yr from the start of the supply contract.


India: JSW Cement has taken a loan of US$48.9m with which to finance its planned 47% capacity growth to 25Mt/yr from 17Mt/yr. MUFG Bank India provided the loan subject to sustainability-linked criteria. Press Trust of India News has reported that the producer’s subsidiary Shiva Cement is in the process of establishing a US$183m 1.36Mt/yr clinker plant and 1Mt/yr grinding plant in Odisha’s Sundergarh District.


Peru: Grupo Gloria subsidiary Yura says that it is contemplating a cement production capacity expansion. The producer says that process optimisation across its Arequipa and Southern Peruvian cement footprint might go some way towards achieving the envisioned growth. It added that any such projects would go hand in hand with a reform of its customer service practices. Yura is also evaluating possible new limestone mining projects at Pampas del Pongo and Zafranal, and an expansion of its lime production.

DF Sud News has reported that Yura expects to increase its Peruvian cement deliveries by 8 – 10% year-on-year in 2022. Its cement, concrete and lime director for Peru, Chile and Bolivia, Julio Cáceres, forecasts that Peru’s construction demand will continue to grow at twice the rate of gross domestic product. He acknowledged that the company’s 2023 results will likely reflect the country’s expected muted growth compared to 2022. Cáceres said that US$700m-worth of private investment across 30 residential projects in Arequipa is currently suspended, pending the publication of the city’s revised metropolitan development plan.


India: Research by the Indian Institute of Technology – Madras (IIT Madras) has concluded that limestone calcined clay cement (LC3) production emits 40% less CO2 than ordinary Portland cement (OPC) production, and is 20% less energy intensive. United News of India has reported that the Switzerland-based Swiss Agency for Development and Cooperation supported the study.


India: UltraTech Cement and India Cements are reportedly poised to conclude a deal for the acquisition of the latter’s 185ha Pawai limestone mine in Panna, Madhya Pradesh, by Mumbai-based UltraTech Cement. Marketline News has reported that the Aditya Birla subsidiary expects to pay US$98m for the asset.


France: Hoffmann Green Cement Technologies is supplying its low-CO2 clinker-free cement for the construction of an industrial prototype glass wool recycling plant in Chemillé-en-Anjou by Saint-Gobain subsidiary Isover. The company will supply its H-UKR cement for use in the facility’s foundations.

Hoffmann Green Cement Technologies co-founders Julien Blanchard and David Hoffmann said "This unprecedented project is totally in line with what we want to embody since the creation of Hoffmann Green: the promotion of the circular economy in the construction sector through the revalorisation of waste from industry."


India: Jaypee Group subsidiary Jaiprakash Associates is reportedly seeking to sell its remaining assets after receiving a new insolvency bid from State Bank of India. The Times of India newspaper has reported that the company has previously sold US$4.92bn-worth of assets to pay off debts.

Jaiprakash Associates chair and chief executive officer Manoj Gaur said "We have kept faith in the law of the land and helped maximise recoveries of the bank. The setback is due to circumstances and issues such as the UltraTech deal. Our intent is to clear all the dues.”

The producer failed to sell a cement plant to UltraTech Cement under a US$2.05bn, 21.2Mt/yr cement capacity deal in 2017.


Brazil: CSN Cimentos has announced its second issuance of non-convertible debentures totalling US$125m in value through a restricted efforts public offering. LC news has reported that the company’s subsidiary Elizabeth Cimentos guaranteed the transaction.


France: Fives has secured a contract to supply a 65MW Pillard NOVAFLAM Evolution burner to a cement producer. The customer’s aims are to continue to maximise alternative fuel (AF) use, to improve clinker quality and to reduce NOx emissions at its cement plant. The order also includes precalciner burners and a natural gas-powered 35MW Pillard hot gas generator, as well as valve trains and pumping systems.


India: Ambuja Cements says that it has created a non-disposable undertaking (NDU) on more than half of its 50% stake in fellow Adani Group subsidiary ACC. The Telegraph newspaper has reported that the producer intends to use the NDU as collateral for its loans.


India: Police in Madhya Pradesh have arrested the head of human resources of a cement producer in connection with the killing of trade union leader. The victim, Manish Shukla, worked at a cement plant in Maihar in the district of Satna. The Times of India newspaper has reported that Shukla was fatally wounded in a knife attack by three men on 19 September 2022. His killing sparked protests outside the Maihar police station, in which other cement plant workers reportedly participated.

Maihar is the location of cement plants belonging to KJS Cement, Birla Corporation subsidiary RCCPL and Aditya Birla subsidiary UltraTech Cement.


US: The Board of County Commissioners of Boulder, Colorado, has denied Cemex USA’s application for a 15-year extension to its Dowe Flats quarry mining licence, following its expiry on 30 September 2022. Commissioner Claire Levy cited dust, traffic, noise and disturbances to wildlife as reasons behind the decision.

Cemex USA’s nearby Lyons cement plant has previously relied on the quarry for the supply of 760,000t/yr of limestone.


India: Ramco Cements has commissioned its new US$366m Kolumigundla cement plant in Andhra Pradesh’s Kurnool District. The Hindu Business Line News has reported that the plant has a clinker capacity of 2.25Mt/yr. It will be equipped with a 12.2MW waste heat recovery plant, 6MW-worth of which will be commissioned in October 2022, with the remainder to follow in 2023. A dedicated fossil fuel-fired power plant and 35km-long railway siding will follow some time in the 2024 financial year.


US: Thailand-based Siam Cement Group (SCG) has invested in Rondo Energy, developer of the Heat Battery. The cement company aims to help its various business lines to decarbonise their operations through deployment of Rondo Energy’s technology. Rondo Energy said that the partnership will support and earlier expansion of its product’s footprint across Southeast Asia and worldwide.

Rondo Energy chief executive officer John O’Donnell said “Rondo is excited to be working with SCG. Rondo’s technology opens a new pathway for SCG to achieve their deep decarbonisation goals and simultaneously reduce their operating costs. SCG’s deep capabilities in execution and quality will enable Rondo to deliver reliable energy infrastructure rapidly and at scale. Together, Rondo and SCG have the global footprint to deliver deep decarbonisation projects, including heat as a service projects in Southeast Asia and worldwide.”


UK: Breedon Group, together with Australia-based First Graphene, Morgan Sindall Construction & Infrastructure and the University of Manchester, is developing a new reduced-CO2 graphene-enhanced cement. The consortium is currently formulating the cement using varying doses of First Graphene’s PureGRAPH graphene-enhanced grinding aid. The project received a research grant from the UK government earlier in 2022. First Graphene says that the study involves one of the largest commercial trials of its kind to date globally. It is simultaneously collaborating on another similar trial with a Europe-based speciality chemicals producer.

On 29 September 2022, First Graphene launched its latest range of graphene-enhanced cement grinding aids and concrete additives. These join recent launches PureGRAPH AM, an admixture developed in collaboration with South Africa-based Nanoproof/Glade Chemicals, and HexMortar, a dry mortar mix which will be distributed by New Zealand-based GtM Action.

First Graphene says that its cement and concrete segment’s order pipeline totals US$113m in value. Managing director and chief executive officer Michael Bell said “It is pleasing to see our efforts, and those of our collaboration partners, coming to fruition at a commercial scale. One of the primary drivers for the adoption of graphene solutions in this segment is the reduction of CO2 emissions. We’re seeing considerable benefits both in the immediate reductions that can be achieved through the use of graphene-enhanced grinding aids, as well as the potential reductions in concrete usage because of the enhanced physical properties these products provide.” Bell concluded “Working with industry-focused partners such as Nanoproof/Glade Chemicals, GtM Action, Breedon Cement and Fosroc opens the way to an estimated addressable market of more than 12,000t of PureGRAPH across the medium to long term.”


India: Adani Group plans to invest US$100bn in capital expenditure across all of its operations between 2022 and 2032. Mint News has reported that the conglomerate will establish 45GW-worth of new hybrid renewable power plants under the plans. It will also build three new green hydrogen plants, with a combined capacity of 3Mt/yr. It plans to support the latter move with an investment of US$70bn in the establishment of an integrated hydrogen-based value chain.


Russia: The Ministry of Industry and Trade of the Russian government says that building materials are in high supply, but projected possible future shortages, beginning in 2024. The ministry named white cement as one product which it has adequately secured through new import sources. Russian construction remains dependent on imports, and the government says that it will look to further develop domestic production capacities of non-metallic materials from 2024.