Displaying items by tag: Refractory

China: Austria’s RHI Magnesita plans to invest Euro20m in its dolomite plant in China. It is intended to address global pressures in the supply of raw materials to the refractory industry and ‘rapidly’ provide additional volumes to its customers worldwide. In the medium term more than 250 jobs will be created at the brick plant and raw material mine in Chizhou.

The Chizhou site includes an ‘extensive’ dolomite mine and raw material production as well as facilities for the production of high-quality dolomite-based finished products. Successful trials are already underway in the brick plant in Chizhou where it is planned to start production by the beginning of 2019. The raw dolomite mine is planned to resume operation by the end of 2019. This overall investment will eventually lead to the creation of up to 250 jobs.

“After the completion of the investment, RHI Magnesita will be able to offer a fully integrated dolomite source in each of the big regions of the world to our customers and simultaneously offer dual sourcing options,” said Stefan Borgas, the chief executive officer (CEO) of RHI Magnesita. He added that the investment will allow the company to offer its customers in Asia shorter lead times and provide additional capacity to customers in North America, Europe and Asia from local sources.

Borgas went on to say that stricter environmental regulations in China have led to local plant closures, resulting in shortages of both magnesite and dolomite, ‘dramatic’ increases in raw material cost and supply security issues. These developments have accelerated the shift from magnesia- to dolomite based products. High stainless steel production has further fuelled demand for refractory products and compounded the pressure on raw material supplies.

US: Plibrico has appointed Norm Phelps as its new Vice President of Sales. Phelps will be responsible for aligning sales strategy and objectives with Plibrico's long term vision and corporate goals. He will be based in Atlanta, Georgia and will report to Plibrico president and chief executive officer Brad Taylor.

Phelps has worked in the refractory industry for 18 years, holding sales and marketing positions at Vesuvius and Zampell in the US. Later he moved to Europe to join Calderys as Global Market Manager responsible for the aluminum and boiler segments in 2011. In 2014, he took on the role of Business Development Manager, leading the Calderys expansion into North America, including the purchase and integration of Spar and the creation of Calderys USA. Most recently, he served as General Manager for Calderys North America.

Phelps holds a degree in Materials Science and Engineering from Pennsylvania State University and is a graduate of the Executive Development Program at the University of Chicago Booth School of Business.

US: HarbisonWalker International has obtained ISO 9001:2015 certification for its Thomasville monolithic and precast refractory plant in Georgia and its South Shore refractory brick plant in Kansas. The refractory manufacturer now plans to achieve the new ISO standard at the rest of its plants by the end of 2018.

France: Imerys has reorganised its Kerneos and Imerys Refractory Minerals businesses into one division: Imerys Aluminates. The new organisation will be managed by Jean-Marc Bianchi, Vice-President and General Manager, and it will become one of Imerys' 12 divisions.

Imerys Aluminates is expected to generate a yearly turnover of approximately Euro650m, it operates 23 industrial sites in seven countries, and is supported by a global commercial presence. It will offer customers a broad product portfolio across a range of segments, including refractories, building chemistry, civil engineering, investment casting industries and wastewater systems.

US: Refractory manufacturer HarbisonWalker International has decided to close its plants at Oak Hill, Ohio and Sproul, Pennsylvania as it opens a new US$30m refractory plant at South Point, Ohio in early 2018. The closures will affect around 88 employees. Previously in 2016 the company negotiated an end to eleven months of industrial action at the Oak Hill site.

Belgium: Stefan Borgas, the chief executive officer (CEO) of RHI Magnesita, has started working as the new president of the World Refractories Association (WRA). He succeeds François Wanecq, the former CEO of Vesuvius.

The WRA was founded in 2014 by refractory industry associations and multinational companies. The WRA constitutes a forum to debate regulatory issues affecting global trade, circulate aggregated industry statistics, promote the interests of the worldwide refractory industry, and act as a counterpart to other world industry organizations such as the World Steel Association. The WRA is composed of continental associations including Europe (PRE), Latin America (ALAFAR) and North America (TRI) as well as national associations from China (ACRI), India (IRMA) and Japan (JRA). Multinational companies are also direct members.

US: Refractory manufacturer HarbisonWalker International (HWI) has announced two new members of its senior leadership team. Ross Wilkin has joined as chief financial officer (CFO) and corporate treasurer, and Michael Werner has joined as senior vice president, Commercial and corporate officer.

Wilkin joins HWI from Universal Stainless & Alloy Products, where he served as CFO. Before his role at Universal Stainless, he was CFO at Dynamics. Much of Wilkin’s career has been spent with HJ Heinz Company where he eventually became the became the vice president and CFO for the company’s Australia and New Zealand organisation. He began his finance career at KPMG, serving both in Toronto, Canada and in Cleveland, Ohio. A graduate of Carlton University with a Bachelor of Commerce degree in Accounting and Finance, Wilkin is a certified public accountant in both Canada and the US.

Werner previously led global commercial operations for Loparex. Prior to this he spent 20 years at GE Plastics and Sabic in numerous domestic and global roles, where he progressed to become Product General Manager. He began his career at Monsanto as an engineer in Technical Development and as a manager of Business Development in the thermoplastic elastomer business. Werner holds a Bachelor of Science degree in Polymer Science from the Pennsylvania State University.

US: Jon R Tabor has been appointed as the chairman of Allied Mineral Products. He succeeds Jon K Tabor who becomes Chairman Emeritus of the refractory producer. Paul Jamieson, Corporate Vice President of Steel and Domestic Foundry, has been promoted to President.

In the role of chairman and chief executive officer (CEO), Jon R Tabor will retain responsibility for international and affiliate operations, Research and Development, Strategy, Finance, and the global scope of all other departments. Jamieson will take over Columbus-based Domestic Sales, Domestic Operations and Human Resources and report to Tabor.

Allied Mineral Products acquired the monolithic refractory and precast shapes producer Pryor Giggey in early 2017. It also plans to open a production plant in Russia.

France: Julien Soum has been appointed as the European business development manager at Anderman Ceramics. Soum has worked as a commercial engineer in Europe for the last five years with knowledge of the refractory markets for cement and steel working for Refractaria and Hepha. He was educated at the University of Montpellier and the Kedge Business School in Marseille.

As mentioned last week, there were a number of big news stories, one of which was the planned merger between RHI and Magnesita. On 10 October 2016 both companies announced that they were combing to form a ‘leading’ refractory company with complementary assets and a completion date penned in for 2017. As Informed’s Mike O’Driscoll presents a good overview of the two companies and the general implications of the merger we will focus on the cement industry aspects of the merger here. It is worth noting here that the new company will be established in the Netherlands but its shares will be listed in London. O’Driscoll reckons that had the UK voted to stay in the European Union the new company would have been based in London.

Comparing like-with-like for RHI and Magnesita is difficult because Magnesita doesn’t publish figures on its refractory sales to the cement industry. However, RHI produced 443,000t of refractory materials in 2015 for its Industrial Division, including the cement and lime industries, and Magnesita produced 151,000t for its Industrial Division at the same time. As can be seen in Graph 1 RHI produces nearly three times as much refractory as Magnesita in this area. Sales volumes for RHI have fallen over the last five years and Magnesita’s sales hit a high in 2013. Total revenue for RHI, across all business lines, was US$1.95bn or about double that of Magnesita.

Graph 1: Refractory sales volumes to industrial divisions for RHI and Magnesita, 2011 – 2016. Sources: RHI and Magnesita financial reports. Note: Figures for Magnesita are calculated from percentages.

RHI reported that 12.6% of its revenue in 2015 came from the cement and lime industries. It pointed out that this sector of its business benefited from the growing construction industry in North America. Elsewhere, it had a tough time in most of its territories, with the exception of Indonesia where its revenue grew due to a major contract won in the lime segment. Over the last five years RHI’s revenue from its cement and lime customers dipped to a low in 2013 before recovering year-on-year since then.

However, the situation has deteriorated during the first half of 2016 with revenues from the cement and lime industries falling by 13% year-on-year. China was blamed as the biggest single factor, with business down by roughly a quarter as a result of the downturn in the construction industry, falling property prices and lower investment activities. One interesting point that RHI made at this time was that, “the globally weak economic situation and regional excess capacities are causing a decrease in repair volume.” Another was the importance the refractory producer placed on Africa and on Nigeria and Algeria in particular. This seems to belie the petrodollar woes Nigeria has experienced recently and the scaling back by Dangote Cement of its international expansion plans.

Magnesita reported that sales volumes for its industrial segments sector, including cement, dropped by 11.7% year-on-year to 133,000t in 2016. It blamed the shortfall on the declining cement industry in Brazil with problems in Venezuela also contributing. In contrast to RHI though it reported growing sales in the Middle East and Africa, notably in Saudi Arabia and Egypt. Sales revenue actually rose by 10.2% to US$145m due to favourable exchange rates on sales outside of Brazil.

In the first half of 2016 the negative trend in Brazil continued for Magnesita with sales volumes falling by 22% in its so-called ‘established’ markets. This was compensated for by Bolivia, Mexico, Argentina and the Middle East, Africa and the Commonwealth of Independent States territories. Sales volumes for its industrial segments sector rose slightly by 1.1% to 75,200t in the first half of 2016. Again, sales revenue grew on the back of exchange rates.

As with mergers between large producers in the cement industry, if global growth is stagnating, then mergers offer an alternative way for refractory companies to compensate. However, LafargeHolcim’s promise of savings and synergies has withered to periodic news bulletins of what assets the group is planning to sell next. One question to pose is whether the merger of RHI and Magnesita will herald a similar drip-drip of assets disposals in coming years or whether it will usher in a new era for the refractory industry. A large part of this will depend on the health of the steel industry, as well as minority markets such as cement.