Global Cement News

US: A forecast from the Portland Cement Association (PCA) expects a 7.5% rise in cement consumption in 2012. However, the association says that these gains could be immediately erased in 2013 if the so-called US 'fiscal cliff' is not resolved. The fiscal cliff refers to tax increases of US$400bn and federal spending cuts of US$200m currently scheduled to come into effect on 1 January 2013.

If the US House of Congress resolves the fiscal cliff during its session in 2012, the PCA expects the economy to continue to grow and cement consumption in 2013 to increase by 6%. Adversely, even if Congress addresses the policies by the first quarter of 2013, this delay will cause significant economic harm and cause a 2.7% drop in cement consumption.

"Because we believe the odds for either outcome are even, we have adopted a forecasting approach that minimises up and downside risk," said Ed Sullivan, the chief economist at the PCA. "Our baseline scenario blends the two possible outcomes and projects a 1.8% increase in cement consumption in 2013."

Sullivan also reported that the longer the US Congress delays in addressing the fiscal cliff, the greater the adverse effect on economic growth and construction activity in particular. "If no action is taken by mid-2013, the country could be headed into a severe recession," said Sullivan.

According to the PCA report, cement consumption from 1 January 2012 to 30 September 2012 had increased by 10% compared to 2011, with 16 consecutive months of growth. Sullivan attributed this growth to the return of consumer confidence, a strong housing market and, most importantly, growth in employment.

South Africa: The South African National Regulator for Compulsory Specifications (NRCS) has confiscated 'sub-standard' cement imported from Vietnam and is investigating complaints lodged about the quality of two other imported brands.

Daniel Ramarumo, a NRCS spokesman, confirmed that it had received complaints from NPC-Cimpor about Vietnamese cement, which was 'later confiscated by the regulator' in August 2012. The NRCS received a second complaint in September 2012 about Lucky Cement and had instituted an investigation. A third complaint from NPC-Cimpor was lodged on 5 November 2012 about Lucky Cement and Falcon Cement. He said that these complaints were currently under investigation.

PPC (Portland Pretoria Cement) chief executive Paul Stuiver commented that his company had tried to engage with the NRCS about allegedly inferior quality and underweight imports but was 'getting nowhere' because the NRCS had indicated it had tested the cement and it had complied with the standard. Stuiver now plans to raise the issue with the Economic Development Minister Ebrahim Patel.

Stuiver also added that one of the imported cement brands had an elephant on its bags, which resulted in PPC taking them to the Advertising Standards Authority and 'getting them stopped', as PPC also has an elephant on its bags.

Nigeria: Lafarge Cement WAPCO has called on the Nigerian government to explore more ways of using cement, especially in the construction of roads. Joe Hudson, managing director of the Lafarge subsidiary, made the call at the Lagos International Trade Fair.

"The federal government must be commended for successfully implementing the cement backward integration policy, which has seen cement output in Nigeria soar to unprecedented levels, making the country fully independent in cement production and supply," said Hudson. "Following this great achievement, the next step is for all stakeholders to begin to create more value by seeking other applications for the essential commodity." He added that the Nigerian cement industry is now capable of producing far more cement than the country consumes.

UK: French multinational cement producer Lafarge has been named in a list of top ten companies surrendering offsets into the European Union's (EU) emissions trading scheme (ETS) by environmental campaign group Sandbag. According to Sandbag's report 'Help or Hindrance? Offsetting in the EU ETS,' Lafarge purchased 181,425 certified emissions reduction (CERs) credits in 2011.

Carbon offsetting by the European cement sector grew by 246% in 2011 compared to 2010 figures. Carbon offsetting by all European companies grew by 85% in 2011. The companies policed by the EU's Emissions Trading Scheme (ETS) submitted a total of 254 million credits to offset 13% of their carbon emissions. Sandbag's report observed that the majority of these offset credits were due to be banned from the scheme in 2013.

Lafarge surrendered 181,425 credits in 2011, HeidelbergCement surrendered 101,314 credits in 2008, Miebach Gruppe surrendered 65,813 credits in 2011, Colacem surrendered 59,756 credits in 2009 and Italcementi surrendered 37,867 credits in 2010. Sandbag did not report the breakdown of so-called 'grey' and 'green' credits for the cement industry.

"Offsetting was supposed to be a price containment measure to ensure that carbon prices didn't rise too high, but carbon prices have remained low due to excess supply in the market. Offsets are contributing significantly to this oversupply and are now depressing prices so low that the EU ETS almost ceases to have a function," said Rob Elsworth, policy officer at Sandbag.

Zimbabwe: South African cement producer PPC (Pretoria Portland Cement) has announced that its Zimbabwe subsidiary Portland Holdings Limited (PHL) has been awarded an indigenisation certificate by the government of Zimbabwe.

Zimbabwe's Indigenisation and Economic Empowerment Act requires that non-indigenous manufacturing companies operating in Zimbabwe must submit an empowerment plan, to satisfy a 51% indigenous Zimbabwean ownership requirement by October 2015. PHL had a pre-existing indigenous shareholding of 21.4%. It will sell an additional 29.6% to four indigenous parties in the country.

"We see the Zimbabwe market as an exciting growth opportunity and expect our operations to approach full capacity over the next two-three years. This opens up further investment opportunities for PPC in Zimbabwe," said PPC chief executive officer, Paul Stuiver.

PHL is the largest cement producer in Zimbabwe. Together the clinker manufacturing plant in Colleen Bawn and the milling depot in Bulawayo can produce over 1Mt/yr of cement. Zimbabwe has experienced a rapid increase in cement demand since 2009. National cement demand is currently estimated at more than 1Mt/yr.