August 2025

India: Prism Cement Limited has appointed Joydeep Mukherjee as its Chief Executive Officer - HRJ (designate) and Key Managerial Personnel with effect from 16 December 2015. HRJ or H R Jhonson is a division of Prism Cement.

Here are the major stories from the cement industry in 2015 as the year draws to a close. 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..

Will the year of the mega-mergers pay off?
2015 showed a global cement industry that was consolidating. Amongst the multinational producers Lafarge and Holcim finished their merger and HeidelbergCement announced that it was buying Italcementi. Yet alongside this international trend the large Chinese cement producers, who represent over a quarter of the world's production capacity, have continued their own-government-favoured consolidation. The on-going boardroom scuffles at Shanshui have been a lively example of this.

Where this will leave the cement industry as a whole in 2016 is uncertain but mergers and consolidation are no 'magic bullet' for difficult market conditions. After the fanfare subsided from the launch of LafargeHolcim the first quarterly report emerged in late November 2015 reporting falling net sales, net volumes and profit markers.

BRICing it – growth stalls in Brazil, Russia, India and China
The economies of the BRIC nations – Brazil, Russia, India and China – have all suffered in 2015. Brazil and Russia are enduring recessions. Growth in China and India is slowing down. All of this has a knock on in their respective construction sectors.

Over in China, we report today that production capacity utilisation is estimated to be 65% and that cement companies lost US$2.63bn in the first nine months of 2015. The same source says that at least 500Mt/yr of production capacity needs to be eliminated. That represents nearly a third of Chinese total production capacity or about an eighth of global cement production capacity.

Multinationals African plans accelerate
One consequence of all these international mergers is the transformation of the situation in Africa. Suddenly LafargeHolcim has become the biggest cement producer on the continent, followed by HeidelbergCement, Dangote and PPC. Africa becomes the big hope for the multinationals as established markets continues to flounder and growth in Asian and South American markets slackens. Perversely though, should African development growth slow it may cast a poor light on the mega-mergers of 2015 in the coming years.

Dangote Cement is growing fast and it may overtake HeidlebergCement soon as the second largest cement producer in Africa. Yet it may not be plain sailing for the Nigerian company. As we report today, sources in Gambia say that Dangote's plans to open a cement plant are on hold in part to protect its domestic suppliers.

The Gambian government has denied a licence to Dangote to open a cement plant. Dangote has built its empire in recent years by forcing out cement importers from Nigeria. As it expands in other countries in Africa it may now be facing a backlash to playing the nationalist card at home as other countries too desire 'self-sufficiency' in cement production.

Iran shakes off the sanctions
In July 2015 Iran and the P5+1 countries agreed to lift trade sanctions from Iran. The implications for the local cement industry are immense given that the country was the joint-fourth largest producer in 2014, based on United States Geological Survey data. Remove the sanctions and, in theory, the local economy should boom leading to plenty of construction activity. Notably, at the launch of LafargeHolcim the new CEO Eric Olsen was asked for the new group's position on Iran. It didn't have one but this will change.

China expands along the Silk Road
China's cement industry may be suffering at home but it has been steadily expanding in Central Asia. Notably Huaxin Cement has plants in Kazakhstan and Tajikistan and it has new projects in the pipeline. Business may be down at home but steady advancement abroad may offer the Chinese cement industry the lifeline it needs.

Cop out at COP21?
And finally... The 2015 Paris Climate Conference announced a diplomatic coup d'etat in December 2015. However, it apparently forgot to include any binding targets. The Cement Sustainability Initiative (CSI) pre-empted the decision by announced its aim to reduce CO₂ emissions by clinker producers by 20 - 25% by 2030... Provided the entire cement industry follows its lead. Cement plants burning vast swathes of dirty fossil fuels may not have to worry quite yet.

For more a more detailed look at trends in the cement industry check out the Global Cement Top 100 Report in the December 2015 issue of Global Cement Magazine.

Global Cement Weekly will return on 6 January 2016. Enjoy the holidays if you have them.

The Cement Sustainability Initiative (CSI) has announced its aim to reduce CO₂ emissions by clinker producers by 20 - 25% by 2030. It made the announcement as part of a new action plan launched on 8 December 2015 at the 2015 Paris Climate Conference (COP21).

Most of the plan follows the CSI's existing aims announced to chime with the on-going COP21 negotiations. The plan depends on a long-term agreement being brokered successfully in Paris at COP21 as a whole. It then recommends policy in each of its key areas to achieve its goals. All of this sits beneath a general policy statement to, '...encourage policies for predictable, objective, level-playing and stable CO₂ constraints and incentives as well as energy frameworks on an international level.'

The Cement Action Plan is part of the World Business Council for Sustainable Development Low Carbon Technology Partnerships initiative (LCTPi). It puts together a series of measures to aspire to reduce CO₂ emissions by 1Gt by 2030 compared to business as usual. However this reduction is dependent on the entire cement industry getting involved, not just the existing 26 CSI members. Together these 26 members represent just a quarter of world cement production.

The drop in emissions is based on the so-called 'best-in-class' CSI company 2020 targets. To reach this the CSI is suggesting actions including focusing on recording Chinese cement industry emissions and energy usage, improving energy efficiency, promoting co-processing of alternative fuels, further lowering the clinker factor of cements, developing new low-energy and low-carbon cements, looking at the entire build chain to reduce emissions and considering other options such as carbon capture and storage. The plan had the support of the CEOs of 16 cement companies at its launch, with CNBM CEO Song Zhiping adding his assent at the event also.

The most prominent step is the clear focus on China for data capture using existing CSI tools such as the CO₂ and Energy Accounting and Reporting Standard for the Cement Industry, the Getting the Numbers Right (GNR) and the Cement Technology Roadmaps. As the CSI puts it, "What gets measured gets managed."

Given that China produces around 60% of the world's cement, according to United States Geological Survey data, the focus on China is essential. Currently the CSI has six Chinese members: CNBM, Sinoma, China Resources, Tianrui Group, West China Cement and Yati Group. Notable exceptions to CSI membership from the world's biggest cement producers include the Chinese producers Anhui Conch and Taiwan Cement, as well as Russia's Eurocement and India's Aditya Birla Group.

So, the CSI has set out its stall ahead of a hoped-for global agreement on climate change at the Paris conference. If some sort of legal agreement is reached then the CSI has its recommendations ready in the wings to hand to policymakers everywhere to promote its aims. If no agreement is reached then the plan loses momentum although pushing forwards makes sense where possible, starting with better CO₂ data reported especially in China.

Problems lie ahead for the CSI whatever happens in Paris given that the LCTPi Cement Action Plan is a series of policy suggestions from only 16 cement producers aiming for a non-binding target. For example, without some sort of world legal agreement there are clear commercial advantages for non-CSI members to burn cheap fossil fuels in their kilns and undercut their more environmentally pious rivals. The sustaining low cost of oil, dipping below US$40/barrel this week, can only aggravate this situation and distract the strategies of fuel buyers away from co-processing upgrades.

Sri Lanka: Harsha Cabral was appointed as the Director of Tokyo Cement Company Lanka one year ago on 1 December 2014. Cabral was appointed to the Board in March 2009

This week we got our first real sense of how things are going at the new global cement leader LafargeHolcim. The group released its first 'combined' results, which cover the third quarter of the year and the nine month period to 30 September 2015.

First impressions are that LafargeHolcim is having a tough time of it, struggling, as many cement industry players are, with an increasingly tricky and uneven global market. It reported a fall in net sales and adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) for the first nine months of 2015, compared to the same period of 2014. Cement sales were also down by 1.3%. The group said that lower than expected demand was the reason behind lower sales, particularly in China and Brazil, which continue to struggle economically. It also picked out India as a country where momentum was lacking.

Of course, it's not all bad. While net sales were down, they were only down very slightly, by 0.6% year-on-year in the first nine months. Many a cement producer would love to pull in Euro20.4bn in sales and ship 189Mt of cement in just nine months! And, after a sticky start to the year, the picture is improving in some regions, with third quarter performance buoyed by improving fortunes in Asia, excluding China and India. LafargeHolcim was able to continue banking on the strong recovery in North America and parts of Europe, where some markets, such as the UK, continue to buck the otherwise depressing trend.

While these results will be a concern they are by no means horrific. However, they have already given rise to (or at least sped up) LafargeHolcim's future divestment plans. According to Dow Jones, LafargeHolcim plans to raise Euro3.23bn in 2016 from selling off assets, around half as much as Lafarge and Holcim had to sell to allow the merger to go through. The company has reportedly started discussions with interested parties, including private-equity firms and industry rivals about some of the assets. The proceeds will be returned to shareholders through dividends or share buybacks, according to CEO Eric Olsen.

Which assets will be divested remains to be seen. However, it reportedly won't involve LafargeHolcim's assets in Australia and New Zealand, at least in the short term. In the past week or so local media has reported that LafargeHolcim's assets in the two countries were to be sold off. However, since then Holcim Australia's Chief Executive Mark Campbell said the company was 'not currently being sold.' Campbell also added that he couldn't rule out a possible sale in the future.

So, while being clear that LafargeHolcim has no plans to sell its Australian and New Zealand assets at the moment, what could happen if it did? The starting point is complex, especially in Australia. According to the Global Cement Directory 2016, there are six operational integrated cement plants and 12 grinding plants in the country, which share a combined 13.9Mt/yr of cement capacity. LafargeHolcim has a 50% interest in Cement Australia's 4.0Mt of cement capacity, giving it 2Mt/yr of capacity and around 14% of national capacity. The other 50% of Cement Australia is owned by HeidelbergCement. Other major players include Adelaide Brighton, which has 2.3Mt/yr in its own name and a 50% stake in Independent Cement, and Boral Cement, which owns 2.3Mt/yr of capacity outright and 50% of SunState Cement's 1.5Mt/yr of capacity. In New Zealand there are two integrated plants, one operated by Golden Bay Cement and one by LafargeHolcim. The latter, however, is due to be closed in 2016.

If LafargeHolcim was to leave the mix in Australia, it is possible that neither Adelaide Brighton nor Boral would be able to take over its share, due to their already-large market presences. This may leave the door open for other regional players, perhaps a Chinese player looking to exit that country's rapidly-declining domestic market? Cemex is contracting and still heavily indebted, leaving it out of the running. While it is also possible that assets could be sold to private equity firms, another interested player could be Ireland's CRH, with 'cash to burn' and recent disappointment from its failure to buy Lafarge and Holcim's former assets in India.

Of course, if the assets aren't for sale, it won't be possible to buy them, meaning that for now the above is just speculation. However, the quick analysis above does highlight the relative lack of viable cement industry suitors in this region. If LafargeHolcim does ever decide to sell in this region, it might find the assets hard to shift.

Australia: Martin Brydon has been appointed the Managing Director of Adelaide Brighton. He is currently the Chief Executive Office of the Australian construction materials company.

Brydon, aged 60, trained in electrical and electronic engineering with BHP before completing a Masters Degree in Business Administration and the Stanford Executive Program in the USA in 1998.

Brydon joined Cockburn Cement Limited as an Electrical Engineer in 1981. In 1998 he was appointed Cockburn Cement Limited's Chief Executive Officer. Following Cockburn Cement's merger into Adelaide Brighton in 1999, Brydon became the Group General Manager for the Western Division.

In 2001, Martin was appointed to the position of General Manager, Strategy and Business Development for the Adelaide Brighton group of companies. In 2005, Martin was appointed to the position of Executive General Manager, Cement and Lime at Adelaide Brighton and in 2014 in became its Chief Executive Officer.

Nine-month financial results from the major Brazilian cement producers have been reported this week and they are not looking good. The local construction market is weak and cement sales volumes are down. This has been blamed on a 30% shrinkage of real estate financing and a 20% decrease in infrastructure works.

Votorantim has seen its cement sales volumes drop by 4% year-on-year to 26.7Mt for the first nine months of 2015. InterCement has seen its cement and clinker sales volumes drop by 7.2% to 21.1Mt. LafargeHolcim has reported unspecified declines in its cement sector in its disappointing third quarter results.

Overall, the Sindicato Nacional Da Indústria Do Cimento (SNIC) - Brazil's cement industry body, has reported that domestic cement sales fell by 7.7% to 49.2Mt for the period. Particular sales drops by region have been observed in the Midwest (5.8Mt, -11.2%) and the Southeast (22.8Mt, -9.4%). That last region, Southeast, is pertinent given that it contains the country's biggest cement producing state, Minas Gerais.

Votorantim has been pointing out all year that its costs are soaring due to issues in Brazil. Maintenance costs, energy-related costs and the impact of the depreciation of the Brazilian Real on petcoke were all hitting costs. Net revenue has grown so far in 2015, with a growth of 5% to US$2.75bn, mainly due to the company's geographic spread outside of Brazil.

InterCement has noted that new cement production capacity in north-eastern and southern markets have reduced its sales volumes and prices by 1.7%. It too has experienced a rise in energy costs, pegged to the US Dollar. To act against this InterCement is implementing adjustment measures including suspending production at two grinding units and the closure of concrete units.

Alongside this Camargo Corrêa, the Brazilian construction group that owns InterCement, has been planning to sell a stake in InterCement to pay off debt since at least mid-2015. At the time local media reported that Camargo Corrêa planned to sell 10 – 18% of Intercement for between US$648m and US$1.17bn. CEO Vitor Hallack confirmed this week that Camargo Corrêa is still looking for a buyer. In the meantime it has extended US$536m of its short-term debt.

All of this is mirrored by wider economic woes in the country. In October 2015 the International Monetary Fund projected a 3% drop in real Gross Domestic Product (GDP) in 2015. The situation has been blamed on a wider world economy, the slowing Chinese economy and internal factors.

Back on cement, in July 2015, SNIC announced that domestic cement demand could contract by 10 - 15% in 2015 and that consumption could fall to around 60Mt in 2016. Brazil's cement production capacity currently stands at 70.75Mt/yr. Perhaps not coincidentally LafargeHolcim announced a 'portfolio optimisation' in its third quarter results with asset sales of US$3.5bn in 2016. Brazil may be on that list.

For more information on the Brazilian cement industry look out for our report in the December 2015 issue of Global Cement Magazine

People matter in cement companies. Just ask Bruno Lafont, the originally proposed CEO of LafargeHolcim before the merger plans between Lafarge and Holcim changed in mid-2015. Another example is Zhang Bin, the chairman of Shanshui Cement. Some of the shareholders at Shanshui Cement are working hard to remove him. The next attempt has been scheduled for 1 December 2015.

Shanshui Cement, one of the biggest Chinese cement producers, called for the liquidators this week possibly in response. It decided to apply for provisional liquidation after determining that it would default on onshore debt payments due on 12 November 2015. Earlier in the month it had announced doubt whether it could pay its debts.

The scale of this liquidation is monumental for the cement industry. It is broadly similar to a producer at least the size of Dangote going bust. Shanshui Cement is one of China's top ten cement producers. It defaulted on a US$314m onshore debt payment on 12 November 2015.

Based on Global Cement Directory 2015 data, Shanshui Cement is the seventh largest cement producer in the country with 15 cement plants and a cement production capacity of 30.5Mt/yr. Shanshui Cement itself reports that it has a production capacity of 102.6Mt/yr making it the country's fourth largest cement producer. In its 2014 annual results Shanshui Cement reported sales revenue of over US$2.4bn. Its net profit was over US$48m. Sales and profits were down year-on-year in 2014 compared to 2013 and its interim report for 2015 reported the same downward trend. Sales revenue fell by a third to US$793m year-on-year for the first half of 2015. In 2014 its total debt was reported to be US$2.5bn with a gearing ratio of 56.9%, a relatively high figure leaving it vulnerable to decreasing profits.

As the Wall Street Journal and others have reported, the situation has as much to do with corporate politics as it does with over-borrowing. Hot on the heels of Shanshui's liquidation announcement came an offer of help to pay the debts from local rival Tianrui Group if its attempts to change the board of Shanshui were finally successful. Tianrui became the largest shareholder of Shanshui in April 2015 when it increased its stake to 28%. In the process it beat China National Building Material Company and Asia Cement Corporation, who hold 16.7% and 20.9% stakes in Shanshui respectively.

The heart of the Shanshui debacle is the 'key man' clause as reported by Reuters. Borrowing to the company is dependent on current chairman Zhang Bin retaining his position. As soon as he leaves it triggers the repayment of offshore bonds worth US$500m. Normally not due for payment until 2020, the bonds contain a clause that forces the company to sell them within 30 days should Zhang Bin depart.

Shanshui seems likely to be able to pay its debts judging from its sales revenue, assets and the strength of its main shareholders. However, it has chosen to default for the moment. The question for analysts watching this from outside China is whether it masks deeper problems in the Chinese economy as growth continues to slow and industrial overcapacity lingers. Shanshui is the sixth mainland Chinese company known to have defaulted on a bond this year, according to Bloomberg. It's also likely to be operating at a cement production utilisation rate of around 50%.

If the Shanshui Cement situation is more to do with markets than personalities, then it may represent an alarming acceleration of the slowdown of the Chinese economy for the cement industry. If personalities matter more, then the situation is a battle comparable to the politics on the television show 'Game of Thrones.'

Both HeidelbergCement and Italcementi released their third quarter financial results for 2015 this week. The results are worth comparing given the impending acquisition of Italcementi by HeidelbergCement.

HeidelbergCement has reported a rise in revenue of 8% to Euro10.1bn for the first nine months of 2015. Its net profit rose by 27% to Euro762m from Euro599m. Its earnings before interest and income taxes (EBIT) rose by 17% to Euro1.4bn. By region, growth in revenue was reported everywhere except for the group's Eastern Europe-Central Asia region. Notably growth in the group's Asian region is slowing, growth is growing in Africa and markets are recovering in North America and the UK. It is also worth noting that the group's cement and clinker sales volumes fell by 1.1% to 60.6Mt in the first nine months of the year.

Italcementi has reported a rise in revenue of 3% to Euro3.2bn for the first nine months of 2015. It reported a loss of Euro8.1m, down from a loss of Euro63.8m in the previous period. Its EBIT fell slightly to Euro166m. By region the group reported that 'positive' trends in North America, India and Morocco, together with reducing operating expenses in Europe, would be insufficient to counteract revenue losses in France and Egypt. Overall cement and clinker sales fell by 1.4% to 32.1Mt.

Compared to its 2014 results, HeidelbergCement seems set to recover some of its revenue and profit growth after fluctuating income since 2008. Meanwhile, Italcementi has been continuing to cut costs, rebuild its business and profitability. So there are no obvious shocks to the apparent value of either company at this stage. It is also worth noting that the good geographical complementarity of each company's assets could make any potential renegotiation less likely. Everybody looks set to gain something should the purchase go through.

The deal in late July 2015 announced that HeidelbergCement would be purchasing 45% of Italcementi's shares at a price of Euro10.60 per Italcementi share for a total price of Euro1.67bn. The only clause mentioned so far has been 'subject to contractual purchase price reductions'. The deal is still expected to be completed in the first half of 2016 following approval from competition authorities. Approval from the Competition Commission of India was announced in September 2015.

The diverging values of Lafarge and Holcim before their merger in mid-2015 had consequences that led to haggling over the deal and the removal of Bruno Lafont as the proposed CEO of LafargeHolcim. The difference here is that HeidelbergCement is buying Italcementi as opposed to merging with it. However, the performances of both companies remain paramount. Now as then the question will be: is the cost worth it?

For more information read Global Cement's article on the HeidelbergCement purchase of Italcementi in our September 2015 issue.

Colombia: As of 1 March 2016, the current President of Cementos Argos, Jorge Mario Velasquez, will be the new President of the entire Argos group in Colombia.

Velasquez, born in Bogota in 1960, will replace the retiring Jose Alberto Velez. Velasquez joined Cementos Argos in 1984 and, on his way up within the company, has served as General Director of Cementos del Nare, President of Cementos Paz del Rio and Vice President of Logistics at Cementos Argos. He became the latter's President in June 2012. Velez has said that the main challenges awaiting Velasquez are the integration of Odinsa into Grupo Argos, the consolidation of Pactia (the property fund established with Conconcreto) and the expansion of Cementos Argos and Celsia.