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Tanzania allows cement imports for the moment 27 February 2013
Tanzania: The Tanzanian government has rejected calls by local cement companies to place trade barriers on imported cement because local production is still insufficient. Tanzania's Minister for Industry, Trade and Marketing, Dr Abdallah Kigoda said that despite the expected progress from cement industries, the government will still allow cement imports until local producers meet domestic demand.
Kigoda admitted that although imported cement is sold at a lower price compared to locally-produced cement, it should stand as an 'eye opener' for local industries to become competitive. Tanzania has three cement factories: Tanga Cement, Mbeya Cement and Twiga Cement. Another four plants are under construction. The country's cement production capacity stands at 3.25Mt/yr with actual demand placed at 4Mt/yr.
"In order to control importation of more cement local factories had to increase production to meet the demand as the country was surrounded by potential market opportunities such as Southern Africa Development Community (SADC) and the East Africa Community (EAC)," said Kigoda. He also mentioned other challenges facing the domestic cement industry such as a unreliable power sources and high distribution costs caused by poor infrastructure.
CPV and CRH swap assets 26 February 2013
Spain/Ireland/UK: On 26 February 2013 Irish buildings materials supplier CRH plc announced that it and Spanish cement business Cementos Portland Valderrivas SA (CVP) had reached an agreement, effective immediately, regarding an asset swap in relation to certain Spanish assets.
CRH will transfer its 26% stake in Corporacion Uniland SA to CPV. In return, CPV will transfer its 99% stake in Cementos Lemona SA to CRH. CRH will also acquire Southern Cement Ltd, a cement importation business, based in Ipswich, UK as part of the transaction. As part of the transaction CRH and CPV will terminate all legal disputes with each other.
EAPCC returns to profit, eyes expansion 25 February 2013
Kenya: The East Africa Portland Cement Company (EAPCC) plans to expand after returning to profit during the six months ending 31 December 2012. The company said that it was boosted by cost reduction and improved cement sales. EAPCC, Kenya's third largest cement producer, said that it was optimistic of strong full-year results and was exploring expansion into Tanzania. The company already operates in Uganda and South Sudan.
"We are now discussing the financing of these (new) projects," EAPCC's managing director Kephar Tande told investors in Nairobi. The company plans to raise new capital through the Nairobi bourse, with the aim of increasing clinker production to 1.5Mt/yr by 2016 from 0.45Mt/yr at present. Tande also expects EAPCC to double its exports (as a proportion of total production) to 10% by 2014.
EAPCC made a pretax profit of US$4.3m during the six months ending 31 December 2012, compared with a pretax loss of US$2.82m during the same period of 2011. Tande said the business boosted profits by saving about US$9.7m through increased efficiency.
This news is in stark contrast to EAPCC's 2012, which was blighted by boardroom disagreements, strikes, sackings, protests and even a shooting at the plant.
China produces 2.18Bt of cement in 2012 22 February 2013
China: Cement output in China increased by 7.4% year-on-year in 2012 to 2.18Bt, according to data released by the Ministry of Industry and Information Technology. Clinker output rose by 1% to 1.28Bt. Obsolete cement production capacity of 220Mt/yr was eliminated.
In other news the China Building Material Federation has released production information for regions in north-western China. Xinjiang Uyghur Autonomous Region produced 41Mt of cement in 2012, a year-on-year increase of 32.8%. Ningxia Hui Autonomous Region saw cement output increase by 10% to 16.1Mt. Shaanxi Province saw cement output increase by 16.3% to 76Mt. Gansu Province saw cement output increase by 32% to 36.7Mt.
Binani Industries looks to sell cement arm stake 21 February 2013
India: Binani Industries is in talks with potential financial investors such as JP Morgan and state-owned funds in the Middle East to sell up to a 40% stake in its subsidiary Binani Cement as it seeks to raise capital to cut its debt and expand its cement capacity. Potential investors may include Abu Dhabi Investment Authority and Qatar Investment Authority.
The company, which has a total cement capacity of 11.25Mt/yr, has integrated cement plants in Rajasthan, India and a 2Mt/yr grinding unit in Dubai's Jebel Ali Industrial Area. The company has previously expressed an interest in expanding both inside and outside of India.
At US$130/t of installed capacity, Binani Cement will be valued at US$1.47bn. A 40% stake is thus worth around US$568m."The valuation of Binani Cement will be evolved in discussions with the financial investors and will be in compliance with the regulatory guidelines," said Sunil Sethy, executive vice-chairman and MD of Binani Industries."Given the overcapacity (in the Indian market) the absence of mergers and acquisitions has been surprising."