Displaying items by tag: LafargeHolcim
Ambuja Cement ranks seventh in Dow Jones Sustainability Index
10 January 2018India: Ambuja Cement has been ranked seventh in the Construction Material category of the Dow Jones Sustainability Index (DJSJ) 2017. The subsidiary of LafargeHolcim was invited to participate in the DJSI Emerging Markets Index and beat its score from 2016. Each year about 2500 global companies, listed on the stock exchange, belonging to about 59 economic sectors, are invited to participate in the DJSI.
GICA reports nearly 14Mt of cement production in 2017
09 January 2018Algeria: Groupe des Ciments d’Algérie’s (GICA) cement production rose by 11% year-on-year to 14Mt in 2017 from 12.6Mt in 2016. The cement producer beat its own forecast of 13.2Mt for the year, according to the L’Expression newspaper. Production rose in 2017 due to the opening of its Aïn El Kebira, Sétif cement plant in the first quarter. Local production capacity is forecast to reach 40.6Mt/yr by 2020 with 20Mt/yr supplied by GICA, 11.1Mt/yr supplied by LafargeHolcim and the remainder from other companies.
New cement plants in Uganda expected to swamp demand
09 January 2018Uganda: Three new cement plants or upgrades to existing plants opening in 2018 are expected to dwarf local demand. Hima Cement, a subsidiary of LafargeHolcim, plans to open a new 1Mt/yr grinding plant at Nyakesi, Tororo Cement is expanding its plant to 3Mt/yr and Kenya's National Cement is building a plant at Mbale, according to the Ugandan Independent newspaper. Following completion of the three projects local production capacity will rise to 6.8Mt/yr from 3.6Mt/yr. Local demand is 2.4Mt/yr.
Cement industry executives are expecting growth in the construction industry as the government starts infrastructure projects in the oil and gas sector. The cement producers also expect export markets to support local production capacity growth, particularly in South Sudan, western Kenya and eastern Democratic Republic of Congo.
Cemex pays fine to Colombian competition body
08 January 2018Colombia: Cemex Colombia has paid a US$25.3m fine to the Superintendent of Industry and Commerce (SIC). The penalty follows an investigation into price fixing by Cemex, Cementos Argos, and Holcim and six senior managers, according to the El Economista newspaper. However Cemex plans to lodge an appeal with the Contentious Administrative Court to reverse the fine.
The fine covers behaviour by the companies between January 2010 and December 2012. SIC’s investigation discovered that collusion between the cement producers artificially increased the price of cement by 30% despite inflation being 9% during the period.
Sun shines on the cement industry
03 January 2018Just before the Christmas break one of the Global Cement editorial staff noticed how many solar projects have been popping up in the industry news of late. Looking at stories on the Global Cement website tagged with ‘solar’ five occurred in a six month period of 2017 out of a total of 13 since 2014. It’s not a rigorous study by any means but projects in the US, South Korea, India, Namibia and Jordan all suggest a trend.
All these new projects appear to be providing a supplementary energy source from photovoltaic (PV) solar plants that will be used to supply a portion of a cement plant’s electrical power requirements at a subsidised cost. Typically, these initiatives are preparing to supply 20 - 30% of a plant’s electricity over a couple of decades. These schemes are often supported by government subsidies to encourage decarbonised energy sources and a general trend in societies for so-called ‘greener’ energy sources in the wake of the Paris agreement on climate change.
Global Cement is familiar with this model of solar power in the cement industry from its use at the HeidelbergCement Hanson plant at Ketton in the UK. The project was realised by Armstrong Energy through local supplier Lark Energy and it provides around 13% of the cement plant’s electrical energy needs. Originally the array started off by supplying 10MW but this was later increased to 13MW in 2015. A key feature is that as part of the agreement with Armstrong Energy, Hanson receives 35% of the solar power generated for free and buys the remaining 65% at a fixed rate. Even at this rate the plant expects to save around Euro11m in energy costs over the lifetime of the solar array. In addition it will save 3500t/yr of CO2.
Most of the new solar projects announced in 2017 are of a similar scale and ambition to what Hanson Cement has done at Ketton. However, JSW Group’s plans are a magnitude larger. The Indian cement producer wants to build a 200MW solar plant next to its cement grinding plant at Salboni in West Bengal for US$124m. However, it has hedged its bets somewhat by saying that it might build a 36MW thermal power plant instead if its proposal fails.
LafargeHolcim and Italcementi have also experimented with concentrated solar power (CSP) plants for the cement industry. In 2007 LafargeHolcim and the Solar Technology Laboratory of the Paul Scherrer Institute and the Professorship of Renewable Energy Carriers at ETH Zurich started researching using high-temperature solar heat to upgrade low-grade carbonaceous feedstock to produce synthetic gas. The intention was to use the synthetic gas as a substitute for coal and petcoke in kilns.
Italcementi’s project at the Aït Baha plant in Morocco uses a CSP process that can be used with the plant’s waste heat recovery unit. Its moveable trough-style solar collectors follow the sun throughout the day to warm up a heat-transfer fluid during the day and store the heat in gravel beds overnight. In this way the CSP process allows for continuous operation over 24 hours. Before Italcementi’s acquisition by HeidelbergCement in 2016 the company had long-term ambitions to roll-out its CSP process across plants in the Middle East and North African region.
New battery technology of the kind backing the growing electric car industry may be further pushing the cement industry’s preference to PV over CSP power. The other renewable energy source slowly being built to support cement plants has been wind. Like PV it too suffers from cyclical disruptions to its power. Technological entrepreneur Elon Musk (of Tesla car fame) notably supplied the world's largest lithium-ion battery to Southern Australia to support one of its wind farms in late 2017. Around the same time local cement producer Adelaide Bighton announced in a separate deal that it had struck a deal to use wind power to part-power some of its facilities in the same region. At present it doesn’t look like solar power will be completely powering cement plants in the near future but perhaps a renewable fuels rate along similar lines to an alternative fuels rate might be a growing trend to watch.
The Global Cement CemPower conference on electrical power, including waste heat recovery, captive power, grinding optimisation and electrical energy efficiency, will return in January 2019.
France: Patrick Debavelaere has been appointed as the director of LafargeHoclim’s Val d'Azergues cement plant near Lyon. He suceeds Thomas de Charrette who has been in post for six years, according to Le Pays Roannais newspaper. Debavelaere, aged 43 years, had been working as an industrial director for Lafarge France’s aggregate business. Prior to this he was the production manager at the Martres cement plant.
Slovenia: LafargeHolcim has lost a legal battle for an environmental permit at its Trbovlje cement plant. The cement producer appealed against a decision by the Environment Agency to decline to issue its consent to the company in May 2016, according to the Slovenian Press Agency. The company has been attempting to increase its cement production capacity to 1250t/day by using petcoke as a fuel.
2017 in Cement
20 December 2017To mark the end of the calendar year we’re going to round up some of the major news stories from the cement industry in 2017. Like last year this piece also complements the corresponding article ‘The global cement industry in 2017’ in the December 2017 issue of Global Cement Magazine. Remember, this is just one view of the year's events. If you think we've missed anything important let us know via LinkedIn, Twitter or This email address is being protected from spambots. You need JavaScript enabled to view it..
Recovery in Europe
2017 was the year that the European cement industry finally had something to shout about after a lost decade since the financial crash of 2007. The good news was led by a revival in cement consumption in 2016 that looks set to have continued in 2017. Prospects in Germany and Spain feel similar and a series of mergers and acquisitions have taken place in Italy suggesting that investors believe that the market is about to recover there too. Sure, Brexit is looming but as contacts have told Global Cement staff throughout the year, if the British want to damage their economy, that’s their business.
Renewal and recrimination at LafargeHolcim
Lafarge’s conduct in Syria during the civil war has cost its successor company LafargeHolcim dear, with the loss of its chief executive officer (CEO) Eric Olsen and potential reputational damage if the on-going investigation in Paris finds fault. At the time of writing Olsen, former Lafarge CEO Bruno Lafont and the former deputy managing director for operations Christian Herraul are all being questioned by the inquiry into the affair as it attempts to determine who knew what and when. LafargeHolcim has drawn a line under the debacle by appointing outsider Jan Jenisch as its new CEO in mid-2017. He has made changes to the group’s management structure that were announced this week but has he done enough? If anything truly ‘explosive’ emerges from the investigation, the question for anyone across the world buying LafargeHolcim’s products may be whether or not they want to finance extremism through their purchase.
US doesn’t build wall but does okay anyway
The US Portland Cement Association (PCA) may keep downgrading its forecasts of cement consumption growth but the local industry is doing fairly well anyway. All sorts of cement producers with a presence in the US have benefited from the market, despite extreme weather events like Hurricane Irma. President Donald Trump may not have delivered on his infrastructure development promises or built his fabled wall yet but his recently-approved tax reforms are likely to benefit the profits of cement producers. The decision by Ireland’s CRH to buy Ash Grove Cement in September 2017 may remove the largest domestically-owned producer from US hands but it shows confidence in the market and heralds the continued creeping growth of the building materials company into an international empire.
South America shows promise… just don’t mention Brazil
Countries like Brazil, Colombia and Venezuela may not be performing to expectations but other countries south of the Darian Gap, have been growing their respective cement industries. The leader here is Argentina that is riding a full-scale construction boom with capital investment chasing it from the producers. Bolivia is following a decade of growth although this may be starting to slow somewhat. Chile appears to be realigning itself to take in more exports. And finally, Brazil may also be starting to return to growth too. Although cement sales were continuing to fall year-on-year in the first nine months of 2017 the rate has been slowing. Local producer Votorantim also reported improved market conditions at home.
India stares into the demand gap
UltraTech Cement finally managed to buy six cement plants and five grinding plants from Jaiprakash Associates for US$2.5bn in 2017. The acquisition marked the end of the long-running deal between the companies and what may be a new phase in further integration in the Indian industry. In September 2017 the Cement Manufacturers Association (CMA) complained that the sector had 100Mt/yr of excess production capacity out of a total 425Mt/yr. The government’s demonetisation policy sank cement production growth in late 2016 and production has struggled to improve since then. Some estimates expect growth to return in around 2020 as the demand gap shrivels. Further merger and acquisition activity can only help until then, although the current government flip-flopping over a petcoke ban and import duties may get in the way.
China restructures with an eye on overseas market
As discussed last week the mind-bogglingly massive merger between China National Building Material (CNBM) and China National Materials (Sinoma) is proceeding with the press equivalent of radio silence. If one trusts the company figures then the largest cement producer in the world will get even bigger following completion. Once the big Chinese producers start building lots of overseas plants then the implications of combining a major producer with a major plant builder may become clear outside of China. Alongside this the buzzword on the Chinese cement company balance sheets this year have been a major rollout of co-processing at plants and a policy of ‘peak shifting’ or simply shutting off production at selected plants in the winter months. Somehow despite all of this the official figures suggest that cement production is still growing in China.
The African mega deal that wasn’t
The prospective bidding war for South Africa’s PPC has turned out to be a bust. A low offer was made in September 2017 by a Canadian investment firm with the aim of merging PPC with local rival AfriSam. Vague expressions of interest from the usual suspects followed over the following months before everything fizzled out. What the dickens was going on? A difference of opinion between the board and shareholders? A poor market in South Africa giving everyone the jitters? If any readers know, please get in touch. PPC’s poor showing at home mirrors Dangote Cement’s travails. Both companies have suffered domestically whilst going full tilt elsewhere in Sub-Saharan Africa.
Indonesia about to pick up?
And finally, a report from Fitch Ratings this week suggests that growth in Indonesia is set to pick up once again. The market dragged down HeidelbergCement’s mid-year financial results as cement consumption dropped in the same period. Like India, Indonesia faces a consumption-capacity mismatch. However, with annual consumption poised to grow at over 6%, the time to close that gap will narrow. Some good news to end the year with.
Global Cement Weekly will return on 3 January 2018. In the meantime Merry Christmas and a have Happy New Year!
LafargeHolcim makes changes to management structure
15 December 2017Switzerland: LafargeHolcim has changed its management structure to make it more market focused. It has appointed Marcel Cobuz as the head of its European region and René Thibault as the head of its North American division. Two of the group’s global business functions, Performance & Cost and Growth & Innovation, will be merged into a new corporate department, Growth & Performance, under one leadership. Further changes will be made to the reporting of its regions with the addition of Mexico to its Latin America region, the addition of Australia and New Zealand to Asia and its Chinese and Trading divisions will now report directly to the group’s chief executive officer (CEO).
“Establishing a market-focused management organisation is an important step towards generating an attractive growth profile and taking the company to its next level of performance,” said CEO Jan Jenisch. “The strengthening of the profit and loss responsibility of the countries and the simplification of global business functions will create a leaner and more agile operating model. Countries will be fully empowered and accountable for market strategies, cost discipline and results. The new organisation will be complemented by a strengthened performance management system focusing on growth, cash conversion, capital efficiency and people development.”
The group’s 30 largest country organisations will directly report to the Executive Committee and the global business functions will be merged under one leadership. As a result of these changes, the Executive Committee will be reduced to nine members. All of the management changes will take effect from 1 January 2018.
Marcel Cobuz, aged 47 years, has been appointed as Head Region Europe and a member of the Executive Committee. He succeeds Roland Köhler, who has decided to retire. Cobuz, a Romanian and French citizen, joined LafargeHolcim in 2000. He has held various operational roles in six different countries and has been country chief executive officer (CEO) in Indonesia, Iraq and Morocco.
Köhler will retire at the beginning of 2018. He has worked for LafargeHolcim and its predecessors for more than 30 years and has been a member of the Executive Committee since 2010, most recently as the Head of Europe, Trading and Oceania. Köhler will continue to support LafargeHolcim as chairman of the LafargeHolcim Foundation for Sustainable Construction. He will also continue to represent the group as a non-executive director in local subsidiaries of the company.
René Thibault, aged 51 years, was been appointed as Head Region North America and a member of the Executive Committee. He succeeds Pascal Casanova, who has decided to pursue opportunities outside of the group. Thibault, a Canadian citizen, joined LafargeHolcim in 1989 and has held various roles in France and Canada. He has been the CEO of Western Canada since 2012.
Urs Bleisch, currently Head of Performance & Cost and Member of the Executive Committee, has been appointed Head of Growth & Performance. Gérard Kuperfarb, Head of Growth & Innovation, has decided to pursue a career outside the group.
Finally, the group’s new chief financial officer (CFO), Géraldine Picaud, will take over the role on 3 January 2018, earlier than the February 2018 date that was originally announced.
Lafarge Zambia fined for market abuse
20 December 2017Zambia: The Board of Commissioners of the Competition and Consumer Protection Commission (CCPC) has fined Lafarge Zamiba over US$19,000 for abusing loyalty discount schemes, price discrimination and excessive pricing. The fine represents 10% of its annual turnover in 2012, according to the Times of Zambia newspaper. It follows an investigation in the cement producer from mid-2013 following accusations of ‘persistent’ price rises.
The CCPC says that Lafarge Zambia’s pricing policy discriminated the domestic market against the export market and particularly distorted the sector in Lusaka. It has ordered the company to cease and desist such behaviour and to report to the board in early 2018 regarding how it is complying with the ruling.
Lafarge Zambia operates two cement plants in the country. It says it made revenues of US$171,000 in 2016.