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China cement news in brief 19 June 2013
National: China saw cement output increase by 8.9% year-on-year to 866Mt for the first five months of 2013, according to the recent data released by the National Bureau of Statistics. Cement output grew to 224Mt in May 2013, a year-on-year increase of 8.5%.
Regional: Shanghai saw cement output slide by 4.1% year-on-year to 0.77Mt in May 2013, according to the local statistics bureau. However, the municipality's cement output grew by 2.4% year-on-year to 3.05Mt for the first five months of 2013.
Hubei Province, in central China, saw cement output edge down by 0.6% year-on-year to 40.7Mt in the first five months of 2013, according to the Commission of Economy and Information Technology.
Corporate: Asia Cement (China) has said that it has agreed to provide US$68m in loans to Far Eastern New Century (China) Investment Limited from 17 June 2013 to 16 June 2014. The loans will be used for working capital by the borrower.
Jiangxi Wannianqing Cement posted a revenue of US$9.6m from product rebates, government grants and investment returns over the first five months of 2013, according to a company announcement. The company will count the revenue to its total profit for the first half of 2013.
India: HeidelbergCement India sold a grinding plant in Raigad, Maharashtra to JSW Ispat Steel for an undisclosed sum. The announcement was made at the Indian cement producer's annual general meeting on 16 May 2013.
HeidelbergCement India also announced that its shareholders have given it approval for raising funds of up to US$340m through borrowings.
Al Jouf spends two weeks offline 19 June 2013
Saudi Arabia: Al Jouf Cement, which operates in the east of Saudi Arabia, announced on 17 June 2013 that it has been forced to stop cement production until 30 June 2013 for unscheduled maintenance work to be carried out. Al Jouf said that the maintenance would cost around US$1.6m and would be reflected in its second quarter results for 2013.
Zimbabwe: Lafarge Cement Zimbabwe has announced plans to invest US$200m within the next 10 years towards setting up a new cement manufacturing plant. Lafarge Managing Director Jonathan Shoniwa told local press at the company's launch event for Lafarge's 'Building Better Cities" branding campaign that Lafarge Zimbabwe would add 1Mt/yr of cement capacity to its current 0.45Mt/yr. He said the move would also increase its market share from its current level of 38%.
In 2013 Lafarge Zimbabwe is targeting a market share of 40% on account of its strong branding in the country and expects to continue to benefit from the continued growth in demand for cement. In 2012 local demand grew 10%. Growth of 5% is expected in 2013.
Like many other local manufacturing firms, cement producers are facing competition from imports. Recently, PG Industries indicated plans to import cement after seeing an opportunity in the market. "I think competition is always there and you can't shut it out completely," said Shoniwa. "You need to just play the game but we have a strong brand. Other players can import cement, but it takes time to build a brand. They can push volumes but it's not an overnight job to build a brand," Shoniwa said.
Shoniwa also took advantage of the Building Better Cities branding campaign to also announce plans for a multi-million US Dollar low-cost, high-density residential housing scheme. He said the cement producer would partner with banks, local authorities and other relevant players to see the project through.
"We are at the design stage. We are having discussions with possible partners and so far it's looking very positive," Shoniwa said, adding Lafarge's target was to bring the cost of constructing a standard high-density residential housing unit to US$10,000. When people talk of affordable housing, the thing that comes to mind is cheap. It does not necessarily have to be cheap in terms of quality so there is that innovation to say we should come up with new building materials that are
cost-effective."
Authorities are expected to provide land parcels while banks are expected to provide long-term and affordable funding for the scheme to enable beneficiaries to build houses at their own pace. Lafarge Zimbabwe is targeting a 29% increase in the top line in the current financial year after reporting revenue inflows of US$69.9m in the year to December 2012, an increase of 41% from 2011.
Shoniwa said that Lafarge Zimbabwe's full-year revenue is expected to rise to US$90m in 2013, with individual home builders expected to continue supporting the upward trend.
Colacem seeks expansion abroad 19 June 2013
Italy: Colacem, Italy's third-largest cement producer, is increasingly relying on foreign markets, according to director general Giuseppe Colaiacovo, who was speaking at a news conference. Colaiacovo said that the company was looking to offset the 'dire' Italian market.
The company plans to boost its presence in the Caribbean, where it already has a plant in Santo Domingo, Dominican Republic and is looking at the potential oil markets of some African countries such as Nigeria, Mozambique and Angola.