Global Cement News

Iran: The Khazar Cement Plant, one of the largest in Iran was forced to stop production for 10 days due to a dispute with truck drivers. The drivers had refused to transport cement at the rate that they had been paid by the Gilan Province Government. As the plant cannot store the cement it has produced, it had to be shut down temporarily. The drivers have now returned to work after accepting a 15% pay-rise.

The Khazar plant exports cement to Russia, the Republic of Azerbaijan, Iraq and Turkmenistan.

Peru: Cementos Lima, Peru's largest cement producer, has posted a second-quarter net income of US$20.3m, down from US$22.2m a year earlier. The company blamed an increase in its costs.

Lima's second-quarter revenue however, was up year-on-year to US$111.7m compared with US$98.0m a year earlier. The company said that its cement production in the quarter was 0.87Mt, an increase of 12.4% compared to that seen in the same quarter of 2011.

Mexico: Mexico's cement giant CEMEX has released its financial results for the second quarter of 2012. These show total consolidated net sales of US$3.9bn during the period, a 1% rise on a like-to-like basis compared to the second quarter of 2011. Operating earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 11% during the quarter to US$702m. On a like-to-like basis operating EBITDA increased by 22% in the same period.

Cemex attributed the increase in consolidated net sales on a like-to-like basis to higher prices in local currency terms in all of its regions. It reported that infrastructure and residential sectors were the main drivers of demand in most of its markets.

Net sales in Cemex's operations in Mexico decreased by 14% in the second quarter of 2012 to US$833m compared with US$968m in the second quarter of 2011. Operating EBITDA decreased by 4% to US$300m versus the same period of 2011. The groups's operations in the US reported net sales of US$795m for the quarter, up by 15% year-on-year. Here its operating EBITDA increased to US$27m, comparing favourably to a loss of US$17m in the same quarter of 2011.

In Northern Europe, net sales for the second quarter of 2012 decreased by 18% to US$1.10bn, compared with US$1.34bn in the second quarter of 2011. Operating EBITDA was US$122m for the quarter, a 19% fall from 2011. Second-quarter net sales in the Mediterranean region were US$384m, 20% lower compared to the US$477m taken during the second quarter of 2011. Operating EBITDA decreased by 23% to US$96m for the quarter compared to the same quarter in 2011.

Cemex's operations in South & Central America and the Caribbean reported net sales of US$529m during the second quarter of 2012, representing an increase of 20% over the same period of 2011. Operating EBITDA increased by 58% to US$189m in the second quarter of 2012 from US$120m in the second quarter of 2011. Operations in Asia reported a 10% increase in net sales year-on-year to US$142m compared to the second quarter of 2011. In this region its operating EBITDA was US$30m, up by 35% from the same period of 2011.

Fernando A González, Executive Vice President of Finance and Administration, said, "We are pleased with our 22% growth in operating EBITDA on a like-to-like basis, on back of a 1% growth in consolidated net sales. This is the highest EBITDA generation since the third quarter of 2009 and the fourth consecutive quarter with a year-over-year EBITDA increase. We are particularly pleased with the quarterly performance of our operations in the United States, South & Central America and the Caribbean and Asia regions."

Switzerland: ABB, EKZ GETEC and Jura Cement have signed an agreement to install an ABB waste heat recovery (WHR) system at the Wildegg AG cement plant in Switzerland. The WHR is based on organic Rankine cycle (ORC) technology, less common than the steam Rankine cycle, which currently dominates the waste heat recovery sector for cement plants. It is expected that Jura Cement will have to purchase about 20% less electricity from the grid for its operations at Wildegg as a result of the installation. EKZ GETEC is financing the system. It is also supported by the Swiss Federal Department of Energy within its 'Energy Switzerland' programme.

ABB has the expertise required to completely integrate the power plant into the cement production process. The turnkey power station order includes design, project management, delivery, installation and commissioning and is scheduled to be commissioned in November 2013.

Marcel Bieri, production manager at Jura Cement, said, "We will be able to generate 14,400MWh of electric power using ABB's waste heat recovery system. That's enough to satisfy the power demand of about 3600 Swiss households." Cement companies that use WHR technology benefit over the medium to long term because they are less exposed to rising energy prices. Payback times on the capital expenditure necessary for installing WHR plants vary but can be as little as two years in some cases.

According to government advisors cement producers pay more in the UK than other nations for their electricity and it's getting worse.

A Department for Business, Innovation and Skills (BIS) report published on Friday 13 July 2012 has shown that firms in the UK will be forced to pay an extra Euro36 in green taxes on top of the market price they pay for every megawatt hour of electricity by 2020 due to climate policies. This compares with Euro22 in Germany, Euro20 in Denmark, Euro19.3 in France and Euro12.7 in China.

As the Mineral Products Association (MPA) put it, "...cement is an internationally traded commodity and, if it costs more to make it here than to import it, then we are threatening a strategic indigenous manufacturing industry for no environmental gain." Or to put it more bluntly, if the cost of importing cement from France to the UK is less than the energy saving then say 'goodbye' to the UK cement industry. The issue raises one of the core problem of any carbon tax in a global economy. If your neighbours don't have the same tax as you then they can undercut you. Similar arguments rage in Australia and the US.

The UK will be the first country with legally binding targets for greenhouse gas emissions beyond 2020, with a pledge to introduce a carbon floor price of Euro19.98/t in 2013. As Edwin Trout explained in his recent article in Global Cement Magazine on the British Cement Industry in 2011 and 2012 the government took steps to address this in November 2011 with a Euro318m package for energy-intensive industries. Unfortunately as the MPA has now pointed out, the cement industry is ineligible for the first Euro140m of this package because the EU has ruled against such support for the sector in relation to the EU Emissions Trading Scheme.

Unsurprisingly alternative fuels trials are thriving in the UK, such as that at Lafarge UK's Aberthaw plant, which celebrates 100 years of operation this weekend.