Global Cement News

Bosnia-Herzegovina: The Bosnian-Herzegovinian cement producer Tvornica Cementa Kakanj (TCK), part of Germany's HeidelbergCement, has announced that it expects its net profit to increase by 20 - 25% to Euro5.6 - 6.1m in 2013, while it expects cement sales to be broadly flat at around 425,000t. The effects from ongoing investment and process-optimisation measures are expected to kick in in 2013, generating savings that should lead to the projected rise in net profit, according to company director Branimir Muidza. Speaking to regional news agency SeeNews, he described the targets as ambitious and optimistic but not unrealistic.

TCK is making its claims in the midst of a Bosnian market that is estimated to require only 1.05Mt of cement in 2013, a decrease from the 1.10Mt/yr consumed in 2012. In 2008 - 2009 cement consumption was as high as 1.85Mt. Muidza expects that the lack of new investments in the industrial sector and new infrastructure, rising unemployment, illiquidity in the construction sector and a crisis in the real estate market would lead to a continued slump.

Muidza said that the expected impact on TCK's business from the recent EU accession of Croatia, which is the company's largest export market, would not cause problems for TCK, as its cement is already made to EU standards. He added that if Croatia benefits from EU accession further down the road, so will TCK.

Going forward, TCK's investment pipeline for the 2013 - 2014 period features a project for the automation of cement milling and packing operations, modernisation of its sampling laboratory, upgrade of its weighing system, construction of an administrative building and procurement of new IT equipment. No production capacity upgrades have been planned over the medium term as the existing capacity is sufficient to meet the current market demand.

When it comes to long-term investments, which covers the period until 2018, the company plans the construction of a cement silo which should further expand the range of its products and therefore put it in a better competitive position. The cost of the investment is currently thought to be US$10.3m.

Saudi Arabia: Saudi Cement Company has reported a 5.9% year-on-year increase in its second-quarter net profit. It identified a rise in local demand for cement as among the reasons for the improvement.The company posted a second-quarter net profit of US$81.7m compared to US$77.3m in the same period in 2012. Net profit for the first six months of 2013 was US$172.5m, a 5% rise compared to the first half of 2012.

Meanwhile, Yanbu Cement Co's first-half net profit rose by 44.7% year-on-year to US$138.9m, thanks to higher production and sales volumes supported by the start of its kiln line No 5 in 2012.

New Cement Sustainability Initiative (CSI) data for 2011 shows that the global cement industry has reduced its specific net CO₂ emissions per tonne of cementitious product by 17% since 1990. This represents a serious amount of carbon prevented from entering the atmosphere. Using United States Geological Survey (USGS) world production data, if cement producers in 2011 were still emitting C0₂ at 1990 levels 456Bt of additional CO₂ would have been released between 1990 and 2011.

Unfortunately there are a couple of problems.

Firstly, submitting data for the project is voluntary. As the CSI points out in its press release the data set comprises 55% of cement production outside of China. A rough calculation based on global cement production capacity suggests that this could only account for about one third of cement made. So how much carbon does the other two-thirds of cement made emit?

Secondly, although CO₂ emissions per tonne of cement have gone down by a sixth since 1990, global cement production more than tripled (!) in the same time period. USGS data placed world production at 1.40Bt in 1990. It estimated 3.59Bt in 2011. In terms of net CO₂ released into the atmosphere, in 1990 this was 1058Bt. In 2011 it was 2260Bt.

The big cement producers compare as follows to the CSI data, which reports emissions of 629kg/t. Lafarge reported 592kg/t cementitious in 2011 and 585kg/t in 2012. Holcim reported 584kg/t in 2011 and 579kg/t in 2012. HeidelbergCement reported 621kg/t in 2011. Cemex reported 612kg/t in 2011 and 2012. No data on specific net CO₂ emissions were available for the major Chinese cement producers.

The CSI data shows that the cement industry has made an effort to reduce CO₂ emissions since 1990. Yet this has been counteracted by a rise in cement production. To compensate for the rise in production between 1990 and 2011 the specific net CO₂ emissions per tonne of cementitious product would have had to have fallen to below 300kg/t, a drop of 60%.

Environmentally sensitive readers shouldn't despair yet though as the CSI has demonstrated that emissions and production are gradually separating in the cement industry. From 2010 to 2011 specific net CO₂ emissions per tonne of cementitious product fell from 638kg/t to 629kg/t. If this trend continues - and if it is representative for the cement producers the CSI doesn't cover – then the industry may be getting a handle on its emissions. We may be about to hit peak emissions for the cement industry sooner rather than later.

Pakistan: Muhammad Arif Habib has resigned as director from the board of directors of Thatta Cement with immediate effect. Habib bought Thatta Cement with Al-Abbas Group in 2004 when the cement producer was privatised. The company has since become part of Arif Habib Group.

Dominican Republic: President Danilo Medina has inaugurated the Cemento Panamericano (PANAM) plant at Villa Gautier, San Pedro in the Dominican Republic. PANAM executive Manuel Estrella said that the US$80m plant will create 800 direct and 2400 indirect jobs. The PANAM cement plant will increase Dominican domestic cement production capacity to nearly 7Mt/yr.