Global Cement News

Japan: Sumitomo Osaka Cement has announced plans to lift sales of power generated in-house at its Tochigi Prefecture plant using wood biomass fuel. The current fuel mix is 85% wood chips and 15% coal, 20% more wood chips than previously.

The group's operating profit is expected to surge by 41% to US$144m in the fiscal year ending March 2013. Sumitomo Osaka Cement does not disclose power-related earnings, but the steady advance of power sales is expected to become a factor that boosts operating profit by US$12.5-25m.

The power generation facilities at the Tochigi plant were completed in February 2009 and went into full operation in April 2009. Current output is 25,000kw.

Sumitomo Osaka Cement suspended operations at one of the plant's two kilns in January 2012 as part of restructuring measures, giving it capacity to supply more of its leftover power. It aims to contribute to the power supply by selling the excess electricity, especially with Japan's nuclear plants remaining offline due to the aftermath of the Fukashima radiation leak following the March 2011 earthquake and tsunami disaster.

Qatar: A new report by Commerical bank Capital has forecast massive compound annual growth rate (CAGR) for cement consumption in Qatar, one of the wealthiest countries in the Middle East. Investment in Qatar's construction sector on the back of what the report termed 'strong economic fundamentals' will trigger demand for cement, with a forecast CAGR of 12% to 2015.

Qatar's current production capacity stands at 6.2Mt/yr, which meets the country's existing demand. However, Commercial bank Capital expects consumption to peak in 2013 and 2014. The majority of Qatar's large-scale projects that are planned or under construction will be completed by 2015.

The report said that Qatari companies would be 'unlikely' to be able to match the impending demand, meaning that it will have to seek cement imports, likely to come from Saudi Arabia and the UAE.

Cement producers in Qatar are planning to further expand their capacity in preparation for anticipated massive investment in the country's construction sector. The majority of construction activities will be in relation to infrastructure upgrade and real estate developments. Qatar National Cement Company (QNCC), already the country's largest cement producer with a market share of around 70%, is going to add 0.93Mt/yr to take its capacity to 5.36Mt/yr in the coming years.

"The Cement price in Qatar has been stable as it is controlled by the government," the report said. "Going forward, we do not expect any volatility in the cement price and believe that it will continue to remain stable at current levels."

US: Cemex USA has announced a novel plan to install four 120m-tall wind turbines at one of its US cement terminals and quarry in order to cut carbon emissions and energy costs.

The Victorville Planning Commission has unanimously approved the two turbines proposed at Cemex's cement manufacturing plant, with the company stating the project would help keep jobs in the Victor Valley.

"Our operations will continue at Victorville even if the turbine permits are not approved," said Cemex spokeswoman Sara Engdahl. "However, the wind turbine project at our Victorville site is beneficial not only to our operations but to the environment as well. The project will contribute to the local economy through jobs created for the construction and engineering of the turbine, and the project directly partners with California-based Foundation Windpower."

The two turbines in Victorville will produce an estimated 6500MWh of electricity in an average year, enough to sustain 650 average homes, according to the company. The other two proposed turbines will be built at the Black Mountain Quarry in an unincorporated area of Apple Valley. They are under review by San Bernardino County.

The project will reduce greenhouse gas emissions and stabilise energy costs for Cemex, while preparing the company to comply with future carbon emission requirements, according to Cemex's proposal to the city of Victorville.

"The wind turbine project at our Victorville plant is part of our vision and commitment to reduce our environmental footprint and contribute to a cleaner environment," said Engdahl. "Cemex is increasingly using renewable energy to generate power for our operations."

She added that Foundation Windpower began working on foundations of the Victorville site in August 2011. It is scheduled to start erecting the turbines in September 2012.

Spain: The Spanish cement producer Cementos Portland Valderrivas (CPV) has announced that it expects to swing to profit in 2013 thanks to its 'Plan NewVal' launched recently. Plan NewVal 2012-2013 is focused on cost reduction and securing new sources of revenue.

CPV's new chairman and CEO, Juan Bejar, said that CPV's earnings before interest, tax, depreciation and amortisation (EBITDA) are now expected to reach Euro200m in 2013.

Speaking more widely, Bejar noted that cement consumption in Spain came to just 20.4Mt in 2011, down a massive 64% from the 2007 high. Worse is expected in 2012, when consumption is expected to fall another 20% to just 16Mt.

Brazil: Cade, the Brazilian anti trust agency, has recommended that the acquisition of Portuguese cement producer Cimpor by Camargo Corrêa should be approved but that that Votorantim Cimentos should divest its stake in Cimpor.

In 2010, Camargo Corrêa teamed up with industrial conglomerate Grupo Votorantim to acquire 54% of Cimpor, blocking a bid by Brazilian steelmaker CSN in the process. Camargo Corrêa has since raised its stake in Cimpor to nearly 33%, later launching a Euro2.5bn bid for the rest of Cimpor in March 2012 at Euro5.50/share.

Camargo Corrêa's buyout of Cimpor could help competition in Brazil by reducing Votorantim's market share, Cade chief Olavo Chinaglia told the press in April 2012. Votorantim may have to sell some of its Brazilian cement assets to reduce its market concentration. The conglomerate's market share is about 40% nationally but reaches nearly 90% in some regions.

In November 2011 Cade found that Votorantim, along with Camargo Corrêa and four other rivals, colluded to fix prices, hampering competition in the Brazilian cement market during a construction boom. Further approval of Camargo Corrêa's purchase may depend on certain conditions, such as selling assets in some markets and avoiding participation in other cement companies.