Global Cement News

Italy: Construction equipment and machinery manufacturer CIFA celebrated its 85th year of business on 12 September 2013. In attendance at a ceremony held at the company headquarters in Senago were the company's senior management, the CEO of CIFA Davide Cipolla and the President of Zoomlion Zhan Chunxin.

Highlights of the celebration included the inauguration of a company museum and showroom and the publication of a history of the company entitled 'CIFA: The winning anomaly.' The company also inaugurated the TEC (Testing European Centre), a centre where experimental activities and tests are carried out on machine bodywork and components. Other on-going activities for the anniversary included an in-house design centre that was launched earlier in 2013 as part of the anniversary and a facelift of the company headquarters due for completion in the autumn of 2013.

Austria: Ghassan Broummana has been appointed managing director of A TEC Group from 1 October 2013. As managing director Broummana will be responsible for sales and marketing within the A TEC and A TEC GRECO group.

Broummana started his career in 1987 designing and starting-up cement plants. In 1996 he joined Holcim Group Support in Switzerland where he developed and implemented various corporate initiatives. In 2004, he moved to Holcim's subsidiary in Thailand, Siam City Cement, to start up a new business unit preparing alternative fuels and raw materials from industrial and household waste.

In 2009 Broummana joined the managing committee and executive committee respectively of Holcim's subsidiaries in India, ACC and Ambuja Cements. Here he restructured Techport, the unified technical support service centre that provides expertise to both ACC and Ambuja Cements with the aim of improving the efficiency and effectiveness of over 25 integrated cement plants and grinding stations and managing all the major capital expenditure projects for both companies.

Broummana holds a Diploma in Electrical Engineering and a Diploma in Wirtschafts-Ingenieur (MBA) from the University of Dortmund. He has also completed a 'Program for Executive Development' at IMD-Lausanne and 'Advanced Management Program' at Harvard Business School, US.

US: The Portland Cement Association (PCA) has forecast that cement consumption will increase by 4% in 2013, followed by 9.7% in 2014 and 2015.

"Nearly two-thirds of the anticipated growth in 2013 cement consumption will be caused by gains in the residential construction market," said PCA chief economist Ed Sullivan. "Home inventories are declining, signalling that it is time to start building, while the lingering effects of damaged credit due to foreclosure activity have created a robust apartment demand."

According to the PCA's forecast, consumer and business attitudes are expected to increasingly focus on the recovering economy rather than political uncertainty. However Sullivan hoped that the US House of Congress would avoid the political brinksmanship shown during the fiscal cliff crisis of early 2013 during future debt limit discussions.

Sullivan predicts that an increase in local spending on public construction starting in the 2016 financial year will drive a recovery in cement consumption in the US. Due to the high level of cement usage in road construction a rise of 11% in cement is forecast for 2016.

Mozambique: Cimentos Mozambique has signed a contract for the manufacture and installation of a filter to reduce the emissions from its cement plant in the southern city of Matola. The US$8m order has been placed with American Air Filter for installation in 2014.

"Protecting the environment and the health and well-being of the residents of Matola and the surrounding area was one of the first points on the agenda of the new management of the factory. We are convinced that we will be in a much better situation when the new filter is installed next year," said Cimentos Mozambique spokesman Sergio Bandeira.

Cimentos Mozambique is Mozambique's largest cement producer. In late 2012 Brazilan cement producer InterCement took over the company from Cimpor.

At the beginning of September 2013 Lucky Cement reportedly resigned from the All Pakistan Cement Manufacturers Association. The implications of this departure raise interesting implications for Pakistan's cement industry and its export markets.

Lucky Cement reacted to a growing row over energy prices for cement producers in Pakistan. The government increased electricity taxes for industrial consumers by 55% but only increased gas prices by 17.5%. This has created an uneven rise in the cost of production between those smaller cement producers powered off the national electricity grid and those larger cement producers using captive power plants. Suddenly smaller cement producers have found it much more expensive to make cement than their larger competitors.

Although Pakistan's cement industry contains over 20 producers, it is dominated by four major players - Lucky Cement, Bestway Cement, DG Khan and Maple Leaf – who hold nearly half of the country's cement production capacity of around 45Mt/yr. According to local media covering the spat, Lucky Cement uses 100% captive power generation, DG Khan Cement uses 40% and Maple Leaf Cement uses 45%.

In 2009 the Competition Commission of Pakistan issued fines to 20 cement producers found guilty of acting as a cartel and co-ordinating rises in cement prices. Following the action cement prices fell by 30%. Since then prices have steadily risen again with the industry publicly denying the existence of a cartel as recently as April 2013.

Regardless of whether any collusion exists today, with new cement production capacity announced this week by DG Khan, the incentives for Pakistan's larger cement producers are growing to keep their prices low with the benefit of seizing greater market share. Meanwhile the smaller cement producers could be squeezed on both energy input costs and price.

In Pakistan, if the larger cement producers act on the new market opportunities, industry consolidation seems possible. Internationally, if the big cement producers in Pakistan concentrate more on the domestic market then this presents opportunities elsewhere. For example, markets in East and South Africa receive significant cement imports from Pakistan. If the volumes of these imports decrease then local African producers and rival exporters will benefit.

Changes in Pakistan's cement industry carry implications both at home and abroad in its export markets. Who exactly these changes will be 'lucky' for remains to be seen.