Cement company shares prices in India fell this week due to energy supply concerns in the wake of the US-Israeli-led war with Iran. The situation appears similar, so far at least, to the energy shock that followed the Russian invasion of Ukraine in early 2022. We will look at the available news on the situation so far and reflect on what happened in 2022.

The decision by the Islamic Revolutionary Guards this week to ‘close’ the Strait of Hormuz in retaliation to US and Israeli air strikes is the key challenge to energy intensive industries outside of the region. Today’s news reports of commercial ships being damaged in the area further heightens tensions. The International Energy Agency (IEA) estimates that 20% of the world’s seaborne oil trade transits through the waterway. The markets reflected this with a jump in oil prices this week as well as a dip in the share prices of industries likely to be adversely affected, such as the cement sector.

At the end of last week, trade analysts Kpler released an assessment of how the start of the war had affected bulk commodity trade. It noted that Qatar’s decision to declare force majeure on gas exports was contributing to the increase in the price of gas and has major implications for the economics of switching between gas and coal not seen since 2022. Demand from Europe for seaborne coal might rise consequently. It also identified that petcoke exports from Saudi Arabia, the UAE and Oman to China and India were particularly vulnerable to disruption in the Strait of Hormuz. It said that, “Indian cement producers, reliant on fuel-grade petcoke, face the sharpest supply risk and would be forced to source US petcoke at a premium or switch to coal.”

Sure enough the stock market in India reacted at the start of this week. As the Business Standard newspaper noted, for example, the stock price for Ramco Cement fell by 7%. It linked this to the vulnerability of cement production to energy prices, particularly those of petcoke and coal. Oil price increases can also increase logistics costs of moving input and output materials around, and raise the cost of electricity. It placed the volume of petcoke going through the Strait of Hormuz at 0.4 - 0.6Mt/month with India “...absorbing the majority of this.” The country imports half of its requirements of petcoke, signalling that prices are likely to rise. The brokers quoted predicted that these costs would be passed straight on to consumers.

In Pakistan the Iran war has prompted calls for development of the Thar coalfield to be exploited faster to reduce reliance on imports. This is a long-term project but recent events may hasten it. The Dawn newspaper reported that imported coal prices increased by 22% year-on-year in recent weeks to around US$110/t FOB. The local cement sector in Pakistan uses 5Mt/yr of coal and it plans to use up to 20% coal from Thar. Meanwhile, the local press in Bangladesh has been keenly interested in which ships had made it through the strait before the war. Shipments of liquefied natural gas and liquefied petroleum gas that had transited in time were noted. As too were vessels carrying clinker, gypsum and limestone from the Gulf. The first of those is of particular interest in Bangladesh given its relative lack of domestic clinker production. However, alternative sources should be easy enough to find in a world making too much clinker.  

The energy market consequences of the Russian invasion of Ukraine in 2022 were a spike in energy prices in the short term. In March 2022, for example, the head of Türkçimento warned that a jump in the price of Newcastle Coal posed a serious threat to the sector and that the cost of cement from a plant using imported coal might rise by around US$15/t. In the medium term, Russian gas and coal exports shifted away from European markets to Asian ones. For example, the US Energy Information Administration (EIA) reports that Europe and Türkiye received 32% of Russia’s coal exports in 2020. By 2024 this had fallen to 13%, with Türkiye accepting the vast majority. Natural gas exports fell from around two-thirds in 2020 to over one-third in 2024. Major multinational cement producers reported a mixed response to energy costs in 2022. Reasons for this included regional variation within operations, the hedging of energy costs and the use of alternative fuels. Cemex, for example, noted that it had been subject to “uncertain energy supply availability” as a result of the war in Ukraine. Heidelberg Materials said that the “...2022 financial year was characterised by a significant increase in production costs, especially in relation to energy, fuels, and raw materials, which we countered with price adjustments.”

Finally, there is no information readily available of the effects on the war upon the cement industry in the Gulf countries and Iran. Industrial sites such as refineries or desalination plants have reportedly been damaged in the Gulf countries. There is little to no information on the situation inside Iran. If readers have any information on the situation locally they should get in touch.

So far the war in Iran has shown the reliance that cement production in India has on petcoke from the Gulf. Stronger repercussions are likely the longer that the Strait of Hormuz remains blocked. Energy users may start to switch fuel types as the cost of previously favoured fuels escalate. Cement producers are likely to be hedged against this to an extent but there will be considerable regional variation. All of these price rises are expected to be passed to end consumers and inflation rates could rise. This, in turn, may slow construction rates. One positive to end on is that rising alternative fuels utilisation rates may protect cement producers somewhat. Expect more impetus for thermal substitution rates to carry on rising.

Molins’ proposed acquisition of Portugal-based Secil seems set to complete. First, the competition body the Autoridade da Concorrência (AdC) approved the transaction this week. Then Molins’ shareholders consented to the deal on the following day. Let’s take a look at what’s been happening.

Spain-based Molins announced in late December 2025 that it had struck a deal with Portugal-based Semapa to buy the latter company’s cement subsidiary outright for €1.4bn. The transaction was expected to be completed in the first quarter of 2026. Barring the unexpected, this now looks likely to happen. Molins said it would pay for the acquisition using a combination of cash and funds from a syndicated credit agreement and a bond issuance.

Molins placed Secil’s cement production capacity at around 10Mt/yr. This compares to an integrated capacity of 9.1Mt/yr as calculated from the Global Cement Directory 2025 with integrated plants in Angola, Brazil, Lebanon, Portugal and Tunisia. In addition the group also runs a grinding plant in Angola. Plus, on the cement side, Secil manages a terminal in Spain, a terminal in the Netherlands and has operations in Cape Verde. This gives a price of €153/t for the integrated cement plant capacity in the acquisition deal using the latter capacity figure.

This should be added to Molins’ existing cement footprint around the world. It operates majority-controlled cement companies in Spain, Argentina and Tunisia. It also holds joint-control of Cementos Moctezuma in Mexico (with Buzzi) and owns minority stakes in cement companies in Bangladesh, Bolivia, Colombia and Uruguay. Working out Molins’ current cement production capacity around the world is difficult due to the number of minority stakes it owns. However, Global Cement Magazine placed it at around 11Mt/yr in the December 2025 issue. Molins placed its ordinary Portland cement (OPC) production capacity at around 23Mt/yr in its annual report in 2024.

The addition of Secil is a serious acquisition for Molins that expands its geographic footprint. The new network of plants in the Iberian peninsula is the obvious sign of enlargement in its home territory. Yet, the plants in Brazil give the company the makings of a regional market leader in Latin America approaching the likes of Cemex, Cementos Argos and Votorantim. Molins’ made acquisitions in 2024 in the aggregates business in Spain and Bangladesh, and the concrete business in Colombia. Investments in recycled aggregates in Spain and alternative fuels - with a focus in Argentina, Uruguay, Colombia and Bangladesh - were also made that year. Major acquisitions in 2025 included a deal with Titan to buy 80% of Baupartner, a Bosnia-based pre-cast company, the purchase of a 90% stake in Zenet, a Spain-based manufacturer of reinforced and prestressed precast concrete components, and Concremat, the leading precast concrete company in Portugal.

A separate point to note was the resignation of Molins’ previous chair Juan Molins Amat in mid-2025. He was succeeded by Julio Rodríguez. Local press has framed this as a battle between the three arms of the Molins family that controls the company. However, the three parties reportedly coordinated to vote for the Secil deal.

Molins’ decision to buy Secil looks set to take the cement business to a new level, particularly in Iberia and South America. To finish, concrete is a major part of this deal that we’ve not really covered here. Molins reported concrete sales of 1.6Mm³ in 2024. However, Secil said it produced just under 2Mm³ in the same year. This will be a major increase in output in addition to all of these recent precast expansions in Europe.

Holcim published its financial results for 2025 this week. Most of the larger cement producers with operations in Europe have now released either preliminary or full results too. This makes it a good time to recap how these multinational companies all performed in 2025.

Graph 1: Sales revenue from selected cement producers in Europe. Source: Financial releases. HM – Heidelberg Materials.

Graph 2: Cement sales volumes from selected cement producers in Europe. Source: Financial releases.

The first point to note from Graph 1 is the reduction in Holcim’s sales revenue. However, the graph shows the restated figure for 2024 from the reduced business. Its sales were around €25bn before the American business Amrize was spun-off in mid-2025. All of the other companies here continue to have operations in North America to varying degrees. Cemex has its headquarters in Mexico and CRH moved its primary stock market listing to the US in 2023 (but still has its headquarters in Ireland).

Holcim’s sales were down on a like-for-like basis in 2025 mainly due to Europe. Here, even the sales figures for the adjusted sales figures such as in local currencies and organic growth also declined. This may be a problem given that about half of the group’s revenue comes from the region. Happily for Holcim though, its recurring earnings before interest and taxation (EBIT) rose in Europe. All the other regions showed sales revenue growth of some kind. The other point of interest is that the group’s Building Solutions product line delivered lower sales growth than the Building Materials line. The former is the group’s building envelope segment away from heavy building materials. In terms of merger and acquisition activity, the big deal for cement has been the agreement to buy Cementos Pacasmayo in Peru that was announced in December 2025.

CRH is now the biggest cement producer with operations in Europe based on overall group sales revenue. Of course, a hefty chunk of that comes from its businesses in North America. Its International Solutions division, covering operations outside of North America, reported sales revenue of €11.4bn in 2025. Cement divisions in North America and elsewhere both grew revenue and earnings on the back of acquisitions and price increases. The group’s largest acquisition in 2025 was of supplementary cementitious materials (SCMs) supplier Eco Material Technologies in the US.

Heidelberg Material’s (HM) early results indicate a modest rise in sales revenue and a higher increase in operating earnings in 2025. Small rises in revenue were reported in Europe and North America, alongside a decline in Asia - Pacific and sharp growth in Africa-Mediterranean-Western Asia. Earnings were stable in North America but grew modestly in Europe and markedly in Africa-Mediterranean-Western Asia. Naturally, given the investments it has made, the group was keen to highlight that its specific net CO₂ emissions fell by 3% to 512kg/t of cementitious material.

For Cemex, its Europe, Middle East, and Africa segment reported significant increases in sales revenue and earnings due to higher prices, volumes and cost cutting. The group’s other two larger geographic regions, Mexico and North America, didn’t perform as well. Recovery was reported in Mexico in the second half of 2025 though.

Of the other larger Europe-based cement producers, Buzzi improved net sales in Europe, outside of Italy. A fall in sales in the US was blamed on weak demand at the start of the year, particularly in the residential market. Vicat’s overall sales and earnings were up. It did best in Europe outside of France and in its Mediterranean region. Cementir’s revenue was down but its earnings were up. It attributed this to negative currency exchange effects particularly in Türkiye as sales volumes of cement were up. Growth was reported in Türkiye, Egypt, and Asia Pacific in contrast with decline in Northern Europe and Belgium.

In summary, Europe remained a mixed market for most of the companies covered above in 2025. Yet, with a slowdown reported in the US, Europe also delivered growing sales revenue and/or earnings for most of these businesses. Decline in Europe for heavy building materials may be overrated in 2025 based on these results at least.

Finally, some of these multinational companies have operations in the Middle East and all of them run energy-intensive operations. Holcim, for example, divested companies in Iraq and Jordan in 2024 but it retains other businesses in Iraq and the UAE. The war launched by Israel and the US upon Iran in late February 2026 is likely to have an economic impact upon the next set of financial results for many of these cement companies, even if the war ends swiftly.

The European Union (EU) Emissions Trading Scheme (ETS) carbon price took a tumble this week following comments suggesting a rethink by German Chancellor Friedrich Merz. Minds have been focused by the start of the Cross Border Adjustment Mechanism (CBAM) in January 2026, high energy prices and poor growth. The challenge is now on in the lead up to the next proposals to update the EU ETS, expected by July 2026.

As the abrupt change in the carbon price shows, words have power. Especially from prominent politicians. So, when former President Barack Obama told a podcast host this week that aliens were real, the world took notice. Obama subsequently clarified, with some exasperation, that he had responded to a light-hearted question in kind with his belief. Similarly, when Merz said last week that the EU’s carbon market should be revised or delayed, the markets took note. The ETS carbon price fell by 12% from €79/t on 11 February 2026 to €69/t on 16 February 2026. The share prices of large Europe-based cement producers such as Holcim and Heidelberg Materials also fell.

Merz’s speech to the European Industry Summit in Antwerp on 11 February 2026 called for the EU to become competitive again. He noted that the economy had grown by 8% in China in recent years, by 2% in the US and only 1% in the EU. His remedy is to reduce bureaucracy, promote a common European legal framework to make trans-national business easier, improve the common energy market to reduce energy prices, cut AI regulations in and make ‘better’ merger rules. However, all of these well-signposted measures paled in comparison to comments Merz made on a panel at the event about the possibility of changing the ETS. His words were also similar to those of Italy’s Prime Minister Giorgia Meloni, who told reporters last week that the EU needed to review the ETS.

Meanwhile, across the channel in the UK, the government launched its second consultation on its CBAM. The British version is set to start in 2027 and exactly the same kind of arguments and counter-arguments are popping up as in the run up to the EU CBAM. The UK’s Mineral Products Association (MPA) has been lobbying to make sure that the scheme doesn’t hurt the local cement and concrete sectors. Cue familiar issues such as time to test the new system, clarity on the default values importers will pay when emissions can’t be verified, protection for local manufacturers… and so on.

Carbon taxes like the EU ETS are political instruments. They require certainty that they will persist for years or decades before companies will make investments in response to them. So, if the heads of some of the largest economies within the EU start to publicly question the viability of the ETS, why should anyone take it seriously, much less open up the cheque book to build fancy untested technologies such as carbon capture plants!? Naturally, European Commission President Ursula von der Leyen defended the scheme at the Antwerp event. She argued that decarbonisation has been possible in tandem with economic growth over the longer term. It is likely to have been a tough crowd, given that she was making this point at a conference about industrial competitiveness in Europe.

The most likely amendment to the ETS being touted in the press may be an extension of the free allocation system beyond the mid-2030s. Or, in other words, a brake could be imposed on how fast the cost of the carbon tax mounts up for protected industries such as cement. This would also effectively restrict more expensive forms of sustainability such as carbon capture to projects funded by governments, unless there was a step-change in the technology, CO₂ transport infrastructure and so on. All the talk by industry in the run-up to the CBAM was about stopping an external leak of the system and exposing local industry to ‘unfair’ imports. At the moment it looks like the actual leak will come from within. At which point, accusations about carbon taxes merely being a form of economic protectionism seem more credible.