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New PT Cemindo Gemilang cement plant in Lebak 27 June 2014
Indonesia: A new cement plant being built in the Regency of Lebak, Banten Province, is expected to come on stream in 2015. Construction of the plant is already 60% completed. The cement plant, which is owned by PT Cemindo Gemilang, is being built over a 5km2 plot of land and will have a production capacity of 4Mt/yr of cement when it starts operation in 2015. The Regency of Lebak is included in the Master Plan for Acceleration and Expansion of Indonesian Economic Development, an initiative of the Indonesian government.
Trinidad Cement enters Colombian market 26 June 2014
Colombia / Trinidad & Tobago: Trinidad & Tobago's Trinidad Cement Limited (TCL) has entered the Colombian cement market. The company has imported the first shipment containing cement to be processed at its Barrancabermeja facility in Santander. The shipment contains 300t of Type G oil well cement.
In total, TCL has spent US$320,000 on its facility in Barrancabermeja, and it plans a similar project in Llanos Orientales for the second half of 2014.
Australian and New Zealand cement industry shrinks
Written by Global Cement staff
25 June 2014
Bad news for both cement workers and local clinker production in Australia and New Zealand this week with the announcement of job cuts and planned closures of clinker plants. Holcim New Zealand has confirmed that around 120 jobs will go when its Westport cement plant closes in 2016 along with the rationalisation of a few management jobs when the company integrates its Australian and New Zealand businesses. Meanwhile, Boral announced that it will cut 28 jobs from its Maldon Cement plant in Australia when it ceases clinker production at the end of 2014.
With these planned closures cement production capacity in the antipodes will shrink by just over 1.5Mt/yr to around 7.5Mt/yr, a reduction of over 15% Alongside the drop in native cement production players are re-focusing on an import market.
The trend is highlighted by the fact that Boral's Maldon site will retain its grinding mill. Earlier in June 2014 it was reported that Vue Australia is planning to convert a brownfield site on Kooragang Island, New South Wales into a cement storage and transfer plant. In February 2014 Cockburn Cement cut 44 jobs at its Munster cement plant as it started to restructure its operation for grinding using imported clinker. Also in February 2014 Cement Australia, the joint-owned company between Holcim and HeidelbergCement, had a US$17m expansion of its cement loading and storage facility for processing at Osborne approved by local authorities.
Following its restructuring in 2013, which has seen clinker production cease at Waurn Ponds and soon to cease at Maldon, Boral reported that its cement revenues grew in its 2012 – 2013 financial year. This is likely to continue when the 2013 – 2014 year is reported in August 2014. Likewise, Adelaide Brighton reported growing revenues in 2013. Cement Australia reported growing cement sales year-on-year in the first quarter of 2014 following reduced sales in 2013.
All in all the local cement industry in Australia and New Zealand has taken quite a knock in recent years. Reasons for this have included a poor recovery for the local building materials market, high-energy costs, the Carbon Tax in Australia, competition concerns and the spectre of cheap clinker imports from East Asia undercutting everything. However the return to revenue and then profit suggest that the worst of the job cuts and clinker production shrinkage is over.
In this business environment, revelations such as a China Resources spending upwards of US$300,000 on golf are unlikely to garner sympathy for any measures that appear to reduce international competiveness for Australian industry. The current Australian government led by Tony Abbott is set to make good on its promise to repeal the Carbon Tax from July 2014. The environmental effects will be unclear given that the tax may have cut emissions from participating companies by 7%, falling from 342Mt in 2011 – 2012 to 321Mt in 2012 – 2013, according to the Investor Group on Climate Change. As is usual with localised carbon taxation or legislation, whether global emissions fell during this period or whether emissions grew in looser jurisdictions to compensate is hard to calculate. The trend towards clinker imports suggests that there may be a significant contribution from the latter.
Bamburi Cement appoints separate CEOs for Kenya and Uganda
Written by Global Cement staff
25 June 2014
Kenya/Uganda: Bamburi Cement intends to appoint Bruno Pescheux, the country CEO for Syria, as the CEO of Bamburi Kenya and Daniel Pettersson, the general manager of Hima Cement, as the CEO of Bamburi Uganda. At present the Lafarge subsidiary is run as one unit. The Kenyan business has three subsidiaries - Bamburi Cement, Bamburi Special Products and Lafarge Eco Systems while the Ugandan unit is managed as Hima Cement.
"With a view to improving focus on our markets it has been decided that, starting on 21 July 2014, the Kenya-Uganda cluster will be managed as two separate country organisations each with a country CEO and executive team," said outgoing Bamburi chief executive Hussein Mansi in a staff memo. Pescheux and Pettersson will report to Tom Farrell, group executive vice president.
India: The Cement Manufacturers Association of India has asked the Railway Board to withdraw a 6.5% rise in freight rates that is due to start on 25 June 2014 on the basis that the cement industry cannot absorb the cost. A note to the board said that the increase would further discourage the movement of cement and input materials by rail for an already beleaguered industry.
"In the last two and a half-years, the overall transportation cost of cement has gone up by 40%. With the current 6.5% increase in the freight rates. The cement industry, reeling under tremendous price pressure with around 100Mt of idle excess capacity, cannot absorb this increase," said the note.