Displaying items by tag: Import
Holcim Ecuador exports cement to Peru
07 June 2022Ecuador: Holcim Ecuador has despatched its first export shipment of bulk cement to the Peruvian market. The volume of this shipment was 32,700t and it was loaded in 2t Big Bags. Holcim Ecuador says that it invested US$2.2m in establishing the infrastructure to realise this achievement.
Philippines: The Philippines imported 6.47Mt of cement from Vietnam in 2021, 91% of a total 7.11Mt of cement imported in the year. The Cement Manufacturers Association of the Philippines (CeMAP) recorded that total imports increased by 14% year-on-year from 6.25Mt of cement in 2020, while imports from Vietnam increased by 20% year-on-year from 5.4Mt.
The Manila Bulletin newspaper has reported that Philippine cement producers increased their production capacity by 23% year-on-year to 35.3Mt/yr at the beginning of 2022. CeMAP projected further capacity growth of 55% to 54.8Mt/yr by the end of 2025, against a domestic demand that year of 66Mt/yr.
Cameroon: The Cameroon Minister of Trade Luc-Magloire Mbarga has authorised cement producers and importers to begin importing more cement from Congo and the Democratic Republic of Congo (DRC) in order to combat a local shortage. The Business in Cameroon newspaper has reported that Mbarga said that authorisation will operate temporarily, until high cement prices drop.
In 2021, Cameroon produced 4.5Mt of cement. Its domestic consumption was 4Mt, up by 14% year-on-year from 3.5Mt in 2021.
Zimbabwe: Livetouch Investments plans to invest US$100m in the construction of an integrated cement plant. The Herald Zimbabwe newspaper has reported that the group plans to establish the new facility in phases, with the first phase costing US$15 – 20m. The phase will include the exploration of possible locations for the plant with suitable limestone resources, which could then also supply its Redcliff grinding plant. The grinding plant currently imports 4000t/yr of Zambian clinker and also buys raw materials from Lafarge Zimbabwe.
Managing director Kyle Wang said “We are still limited by the limestone resources in the country.” He said that the company has identified ‘good limestone deposits’ in Rushinga, Nyamapanda, Bulawayo and Masvingo, however “The problem with some of the limestone is the quality.”
Peru: Cementos Pacasmayo recorded consolidated sales of US$140m in the first quarter of 2022, up by 13% year-on-year from US$124m in the first quarter of 2021. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) also rose, by 21% year-on-year to US$128m from US$105m. The company said that its strong revenue generation enabled earnings growth despite cost increases. Its reliance on imported clinker to meet growing demand increased Cementos Pacasmayo’s exposure to the effects of inflation.
During the quarter, Cementos Pacasmayo produced 882,000t of cement across its three facilities, down by 4.4% year-on-year. The plants’ clinker production rose by 6.7% to 568Mt from 532Mt in the first quarter of 2021.
South Korea: Finance Minister Hong Nam-ki has announced plans for a further increase to his country’s coal imports from Australia in order to enable cement production to continue and prevent a shortage. The Yonhap News Agency News has reported that the government plans to accelerate customs clearance processes around the fossil fuel. Hong added that the government will ‘sternly deal with any illegal hoarding or price fixing’ of cement.
Cement shortages in the southern US
27 April 2022Cement shortages were being reported in the US media last week in Alabama and South Carolina. The owner of a ready-mixed concrete supplier in South Carolina was blaming it on labour and supply shortages. Dan Crosby, the president of Metrocon, told Fox News that his business could only take on 60% of the work it could normally cope with due to the issue despite demand for construction growing in the state. Meanwhile, the Alabama Concrete Industries Association said that its home state saw a 14% increase in the demand for concrete in 2021 but that a cement shortage might cause delays to projects. The association also pointed the blame at labour and supply issues. It pointed out that high demand for concrete during the winter prevented inventory being built up and then the annual cement plant maintenance breaks in the spring added to the problems. Once contractors actually secured supplies of cement they then faced further delays due to a nationwide truck driver shortage!
Graph 1: Annual rolling cement shipments in the South of the US. Source: USGS.
Data from the United States Geological Survey (USGS) doesn’t especially shed light on the situation in Alabama and South Carolina. Alabama was the fifth largest cement producing state in the country in January 2022 but this is unsurprising as it’s the state with the fifth largest cement production capacity. Rolling annual data on Portland and blended cement shipments by origin show the effects of the coronavirus outbreak in the south from the start of 2020 to January 2022. Shipments took a dive in 2020 and then mostly recovered in 2021. However, Alabama, Kentucky and Tennessee saw shipments rise from 7.1Mt pre-pandemic to 7.6Mt in January 2022. South Carolina’s shipments grew from 3Mt to 3.2Mt. Regionally, the North East had a similar pattern although, unlike the South, shipments have surpassed those at the start of 2020. The Midwest and West were different with a general upwards trend over the two years, although the West softened slightly from mid-2021 onwards. Overall the US as a whole has seen its shipments grow throughout this period.
Ed Sullivan from the Portland Cement Association (PCA) told the May 2022 issue of Global Cement Magazine that the US cement sector did well in 2021 with a 4.1% year-on-year rise in sales to 104Mt. However, he flagged up supply chain problems that actually slowed growth, led by a lack of staff.
The other point along these lines that Sullivan made was that imports of cement might not necessarily be able to compensate for domestic supply issues due to global demand for shipping post-coronavirus. USGS data placed imports to the US at 13.7Mt in 2019 compared to 16.3Mt in 2021. Notably, Cemex restarted one production line in 2021 at its CPN cement plant in Sonora State in Mexico to export cement to the west of the US. In March 2022 it added that it was going to restart another line at the plant also. It’s not alone though as GCC reported in January 2022 that a line at one of its plants in Chihuahua, Mexico, was exporting cement to Texas. Sullivan reckoned that January 2022 was ‘weak’ but that it was followed by an ‘extremely strong’ February 2022. The first quarter results from Holcim and CRH seem to back this up with the former describing the period as ‘outstanding’ and the region leading its sales and earnings growth rate globally. CRH reported strong demand in central and southern regions.
As the US economy restarted following the peak of the early coronavirus waves in 2020, various supply chain issues have manifested. Staff shortages are one issue and this can also worsen other logistic problems. The south seems particularly vulnerable to all of this as it is both the country’s largest cement market and because demand has held up. In January 2022 research by the International Monetary Fund (IMF) identified several reasons for staff shortages in the US and the UK. These included increased inactivity among older workers, the so called ‘She-cession’ (where female employment has overly reduced due to coronavirus trends) and shifting worker preferences amid strong labour demand.
Staff shortages are expected to sort themselves out throughout 2022 but favourable forecast demand for cement in the US is balanced by inflationary pressure. Persistent low staffing levels could further add to inflation growth. The US cement sector may be doing well at the moment but even success carries risks.
Global Cement’s Robert McCaffrey will be giving a keynote presentation at the IEEE-PCA Cement Conference in Las Vegas on Tuesday 3 May 2022. The May 2022 issue of Global Cement Magazine, including interviews with PCA chief executive officer Mike Ireland and chief economist Ed Sullivan, is available to download now.
Russia: Eurocement has started an initiative to reduce its reliance on spare parts purchased from outside of the country. The programme is designed to start a phased transition to in-house production of components. One of the first examples of the scheme has been the development and installation of a clutch for a mill at the Sengileevsky cement plant.
The cement producer hopes to source at least 90% of the parts it requires domestically. At present it says that around 30% of the equipment used in the local cement sector is imported. The estimated economic effect will be around Euro14m.
The company has also announced an unscheduled indexation of staff wages to over 7000 workers at 16 cement plants. Indexing of wages is typically used to compensate for inflation. Other measures have also included food support. Vyacheslav Shmatov, the general director of Eurocement, said ““We have decided to increase our support measures for our employees during this difficult time in order to strengthen our work teams. Eurocement is, first of all, people, so the company will continue to take care of its employees.”
International economic sanctions were implemented upon Russia by European and North American countries in response to its invasion of Ukraine in February 2022.
Cameroon government bans cement exports from East Region
26 April 2022Cameroon: The government has enacted a ban on the export of cement, along with other commodities including oil and grain, from East Region. The Journal du Cameroun newspaper has reported that the impacts of the Russian invasion of Ukraine have exacerbated a difficult supply situation of the basic commodities in the region, dating to the beginning of the Covid-19 outbreak in the country in March 2020.
The East Region borders the Central African Republic and Congo. It has no cement plants of its own.
Kazakhstan: Steppe Cement recorded rising revenues in the first quarter of 2022 due to stronger cement volumes and higher prices during the period. The manufacturer posted sales revenue of US$14m in the three months to 31 March 2022, up by 29.6% year-on-year from US$10.8m in the first quarter of 2021.
Sales volumes rose by 6% to 281,968t from 266,007t, while average prices for delivered cement also climbed. Exports from Kazakhstan fell by 50% as new factories opened in Uzbekistan. Imports into Kazakhstan, predominantly from Russia, increased from 6.5% to 8% of the market.
Steppe Cement estimates that Kazakhstan's cement market demand will stay at 11 - 12Mt in 2022 but added that there was is a high degree of uncertainty due to the ‘geopolitical situation’ in the region.