August 2025

CRH's ambitions took a setback this week when the Irish Competition and Consumer Protection Commission (CCPC) raided the offices of its subsidiary Irish Cement as part of an investigation into the bagged-cement industry in Ireland. Details are vague but the media reports state that the inquiry is examining whether or not the Irish market leader has abused its dominant position in the market, valued at Euro50m/yr.

Undoubtedly CRH and Irish Cement hold a leading place in the local cement industry. Irish Cement runs two integrated cement plants in the Republic with a combined production capacity of 2.7Mt/yr. This constitutes 79% of the country's 3.4t/yr total capacity.

Previous acquisition activity such as CRH's purchase of Dudman Group's UK import terminals in July 2013 has led to concerns regarding market competition. At that time Irish cement importer Eircem complained to the UK Competition Commission (CC), claiming that 'there is no free competition' in the market and also to initiate proceedings against CRH for damages relating to alleged anti-competitive behaviour in that market.

Roll the clock forward nearly two years and CRH is making the headlines once more for a much larger acquisition portfolio: the purchase of the largest chunk of assets sold from the merger of Lafarge and Hocim. With regards to Ireland and the UK, CRH will take on three (Dunbar, Tunstead and Aberthaw) of Lafarge Tarmac's five cement plants. Lafarge Tarmac's other two plants (Cookstown and Cauldon) will become part of the Aggregate Industries division of Lafarge Holcim. And once again, following acquisition activity competition, questions are looming as the CCPC raid suggests. This time though the potential impact of any market abuse, if it is actually happening, is far larger given the influx of UK and European assets that CRH are taking on.

We don't know what the CCPC will find but we can look at how CRH was viewed in the UK CC report on 'Aggregates, cement and ready-mix concrete market investigation' published in January 2014. At that time the CC concluded that, "We have seen nothing to suggest... that the recent acquisitions by CRH will result in importers collectively or individually offering a significantly greater constraint on cement producers than in the past." Amusingly though CRH also told the CC that it had no major expansion plants for the UK.

We also know how one of CRH's competitors felt about them. One of the more telling quotations from the CC report was from a Commercial Manager, at Lafarge Cement Ireland who viewed expansion in Ireland by Lafarge as a 'mechanism' to control CRH's ambitions by attacking it in its home market by showing CRH that Lafarge was a global player. Ironically the comments of that anonymous manager look very different now that CRH is on track to becoming a global player itself.

Nigeria: Dangote Cement has appointed Douraid Zaghouani as a non-executive director with effect from 29 April 2015. Zaghouani holds a degree in Civil Engineering from École Nationale des Travaux Publics de l'État in France and is also a graduate in Business Administration from the École Supérieure des Sciences Commerciales business school in Paris.

Zaghouani is presently the Chief Operating Officer of the Investment Corporation of Dubai (ICD). In this role, he supports the CEO's Office in corporate strategy development and is responsible for the efficient operational management of the organization.

At the 24th AFCM Technical Symposium in April 2015, Nguyen Quoc Thang, plant manager at Vicem's Binh Phuoc cement plant, delivered an outstanding presentation. He explained the sourcing and processing methods for using cashew nut shells as an alternative fuel to replace coal at the plant.

Around 300,000t/yr of cashews are grown and harvested in the south-east of Vietnam, the equivalent of about 130,000t/yr of cashew nut shell, 85% of which remains after processing. According to Nguyen Quoc Thang, the plant uses cashew nut shells to replace 35% of its fuel and has significantly reduced its CO2 emissions and fuel costs by doing so.

Cashew nuts are grown in large quantities in Brazil, India, Nigeria, Vietnam, the Ivory Coast, Pakistan and Indonesia, among others. In 2012, some 4.15Mt of cashew nuts were grown. Cashew nut demand has risen greatly in both the long-term and the more recent past. New (and delicious) products are being designed to meet the demands of health-conscious people and vegans, including cashew nut butters, cashew milks, cashew cream, cashew ice cream, cashew cheese and cashew cooking sauces. All at premium prices, of course, and all driving cashew nut demand ever-higher.

Cashew nuts are always sold pre-shelled, as the shell is toxic if consumed. Their growing production volumes and the necessity that they always be pre-shelled for sale or further processing makes cashew nuts an ideal alternative fuel for cement production, with reliable supplies guaranteed for the foreseeable future, subject to good crop yields. Moreover, cashew nuts are mainly grown in regions that currently have low cement plant alternative fuel substitution rates, providing an instant solution to some of the cement industry's environmental challenges.

Cement producers in cashew nut-growing (and other types of nut) countries would do well to note the example that Vicem's Binh Phuoc cement plant has presented. In addition to saving costs and tackling environmental restrictions, the highly-profitable nut industries could provide extra economic value to their home countries through partnership with local cement plants.

Italy: Cementir Holding has appointed Francesco Caltagirone Jr as Chairman and chief executive officer (CEO), Carlo Carlevaris as Vice Chairman and Riccardo Nicolini as General Manager. Paolo Di Benedetto has been appointed as 'Lead Independent Director'. Chief financial officer Massimo Sala has been appointed as the corporate accounting documents officer for 2015.

The board of directors at Cementir have also established the following internal committees.

Executive Committee: Francesco Caltagirone Jr (Chairman), Mario Delfini and Riccardo Nicolini.

Control and Risk Committee: Paolo Di Benedetto (Chairman), Veronica De Romanis and Chiara Mancini.

Nominations and Compensation Committee: Paolo Di Benedetto (Chairman), Veronica De Romanis, Chiara Mancini and Mario Delfini.

With the UK going to the polls on 7 May 2015 in a general election what does this all mean for the local cement industry? Some of the main issues for a buoyant cement industry are market demand, energy costs and government interference through issues like taxation or restrictions on international trading.

Probably the first big problem facing the UK cement industry would be construction market uncertainty following any prolonged post-electoral negotiations. At the time of writing the polls predict that neither of the main political parties will be able to form a legislative majority without the formation of some sort of coalition with a number of minority parties. This also has relevance for eventual policy, so more on this later. Additional political deadlock might also arise from the Scottish Nationalist Party (SNP), potentially the largest minority party, and their demands for further political devolution from the rest of the UK.

Following this, the main two political parties, the Conservatives and Labour, are fairly similar from their manifesto statements advocating deficit reduction, no major new taxes and a continuation of carbon emission targets. If either party gets in, general government should continue as before with major infrastructure projects carrying on as planned and an emphasis on the economy or public spending respectively.

Differences start to emerge with the Conservative Party, a centre-right group with a liberal economic agenda, promising a national referendum on continued membership of the European Union (EU) that could lead to Britain leaving the EU in a so-called Brexit. This could cause complications for businesses with strong European links such as the cement industry. However a 'Brexit' might not be all bad news for heavy energy users as they could potentially renegotiate their carbon emission targets.

Meanwhile, the Labour Party, a centre-left group, immediately takes a negative point since its current leader held a senior economic post in the Labour government in the build-up to the crash in 2008. Since that time three integrated cement plants in the UK have closed. Back to the current election, threats to reform the consumer energy markets might have knock-on effects for business consumers. However, traditionally the Labour Party encourages higher spending that might lead to more large-scale infrastructure projects like the much-maligned High Speed Two railway line from London to the north. These kinds of projects would need lots of cement.

If any of the other minority parties get to carry an influence in a coalition they may be able to influence certain policies as the price for their support. For example, a UKIP right-wing coalition would demand a EU referendum. A Green left-wing coalition would push for decarbonisation energy policies and/or anti-fracking measures. Both of these outcomes could have effects on cement production. The other issue that minority regional players in a coalition might have is concerning changes to cement plants in their part of the world. For example, threats to shut a cement plant in Scotland, Wales or Northern Ireland might then gain a higher profile to any administration that includes the SNP, the Democratic Unionist Party in Northern Ireland or Plaid Cymru in Wales.

In summary, it is easy to identify what the UK cement industry wants but far harder to determine what will happen after the election. Assuming there is a government that is! The country holds a mature cement industry with limited infrastructure opportunities. Barring real political change such as a Green surge it will be business as usual on 8 May 2015. Cement kilns will keep turning.

Ireland: CRH has said that its Group Finance Director - Maeve Carton - will become the company's new Group Transformation Director. The position is a new strategic group function within the company and Carton's new role will start in January 2016.

As Group Transformation Director, she will identify and implement the optimum financial and business model for the group in the years ahead. She will report to, and work closely with CRH's Group CEO Albert Manifold, and will continue to contribute directly to the board as an executive director.

The building materials group said that a search to appoint a new finance director for the group will start shortly. It is hoped that this process will be completed by the end of the year. Carton will continue as finance director until her replacement has been appointed, which will ensure an "effective transition process".

Striking news from Libya this week with the announcement that an investor with international backing wants to buy the majority stake in the Libyan Cement Company.

Libya holdings owner Ahmed Ben Halim is in the process of buying out the Austrian Group Asamer that originally bought a majority share for US$145m back in 2008. Most of the remaining share was owned by the Economic and Social Development Fund. Taking over the company now seems bold from a European perspective or Ahmed Ben Halim got a very good price. No financial information regarding the deal has been made public.

Libya has remained politically unstable since the civil war in 2011. According to the Libyan Herald, following the war a strike at the Libyan Cement Company's plants for lost wages stopped production. Since then two of the three cement plants the company runs in east Libya near Benghazi have remained shut due to their proximity to fighting with the Ansar Al-Sharia militia. Before the civil war in 2011 the Libyan Cement Company had a combined cement production capacity of 6Mt/yr almost half the USGS estimated production for the entire country in that year.

The Libyan Cement Company's plants are all located in the east of the country under the nominal control of the Council of Deputies based in Tobruk. Its two plants in Benghazi have remained shut due to their proximity to fighting with the Ansar Al-Sharia militia. A third plant near Derna has also had security issues. Halim told the Financial Times that he was not 'crazy' to be investing at this time. "We have a long-term strategic plan" he said, "that Libya's going to rebuild its infrastructure. And a key element of this is cement." If he can hold out until the rebuilding starts then he may just be right.

Meanwhile across the border in Egypt, Minister of Supply Khaled Hanafy announced this week that cement prices had remained 'stable' for the fifth month in row. Some commentators placed improved energy supply security at the heart of this situation allowing producers to build up inventory. However, given the situation in Libya, it is worth considering what will happen once Libyan demand for cement does pick up both in competition for energy supplies like coal and a keener export market.

Finally, our editorial director Dr Robert McCaffrey was at the IEEE-IAS/PCA Cement Conference in Toronto, Canada this week. Here's his snapshot of PCA economist Ed Sullivan's forecast for future US cement supply and demand.

Ed Sullivan's forecast for future US cement supply and demand, at IEEE in Toronto. pic.twitter.com/RUoT7uHGtg

— Robert McCaffrey (@DrRobMcCaffrey) April 28, 2015

The UK London Underground has 'mind the gap' as its well-known warning phrase to prevent passengers falling between the platform and the trains when boarding. The favourable supply gap Ed Sullivan is talking about in US will be one cement producers will definitely not want to miss.

Poland: Lafarge has appointed Jacek Patyk as new director of the Malogoszcz cement plant. He will replace Miroslaw Majchrowicz, who will be in charge of Lafarge's cement plant in Beocin, Serbia

Cameroon announced this week that it intends to ban imported cement to aid the sales from the new Dangote owned cement plant in the country. Readers should note that Dangote is a Nigerian-based company. Protective legislation such as this should come as no surprise given the rise of Nigeria's own cement industry and similar initiatives in that country. The difference here, however, is that the Cameroonian government is protecting investment by a foreign company rather than propping up any home grown concerns.

The new Dangote-run cement plant in Douala will start with a cement production capacity of 0.95Mt/yr with the intention to rise to 1.5Mt/yr in 2016. A meet-and-greet by company officials with local press in early April 2015 revealed that the company intends to snatch 30% of the local cement market in 2015 with prices primed to just undercut the other major producer.

What then of the country's two other integrated cement plants? Both have foreign ownership. Cimenteries du Cameroun, with a 1Mt/yr plant, is a subsidiary of France-based Lafarge. Ciments de L'Afrique, with a 0.5Mt/yr plant, is a Moroccan firm. Add the new 1.5Mt/yr Dangote cement plant and domestic production in Cameroon is anticipated to exceed local demand.

When this happens how will the Cameroonian government view the two non-Dangote producers who may well be importing clinker and other products into the country for their operations? If the experience of Nigeria is a model then a 'self-sufficiency' battle may ensue in the media. Alongside this the price of cement may well stay fairly stable despite any alleged 'gluts'. This week, for example, the Cement Producers Association of Nigeria has lobbied the President-elect of Nigeria, Muhammadu Buhari, to cut the price of cement by half. The hypocrisy during the Nigerian spat over imports was that Nigeria wanted (and has become) a cement exporter.

At the time this column asked how that could work if imports at the time were so much more competitive that they had to be banned at home. Then as now deals seem to mark the way. At that time, in early 2013, Liberia relaxed its tariffs on cement just as Dangote was building a new plant there. Now, in Cameroon, once again Dangote appears to be negotiating some form of preferential treatment.

At the root of these issues, Cameroon's citizens and industry want to build and develop their country. Cheaper cement will enable them to do this by pushing up per capita cement consumption. Protecting their domestic industry or those that have invested in the country may not necessarily lead to cheaper cement.

This week saw the announcement that Cemex and Holcim are both upping their stakes in Nicaragua to increase production. The companies have stated that they expect cement demand to grow significantly in the near future.

Holcim has started work on a US$10m project to increase production by 30% to 400,000t/yr at its Nagarote grinding plant. A second expansion phase will see production raised another 30%. Cemex, for its part, is building a US$55m, 440,000t/yr grinding plant in Ciudad Sandino. Completion is expected by 2017.

These new developments will make significant additions to Nicaragua's cement industry. Currently, it consists of one Cemex-owned 600,000t/yr integrated plant and one Holcim-owned 300,000t/yr grinding plant.

Nicargua has the dubious honour of being Central America's least developed economy and one of the poorest among all of the Americas. In recent years, however, its economy has grown dramatically, with significant expansion in the construction and mining sectors, indicating that Holcim and Cemex are right to bet on Nicargua. Indeed, late in 2014 president of the High Council of Private Enterprise, José Adán Aguerri said that the country had a significant cement shortage and was currently importing from Mexico and Colombia to meet its needs.

Driving cement demand in Nicaragua is the residential housing sector boosted by the growing population, much-needed infrastructure projects and the country's most controversial project, the Nicaragua Grand Canal. The canal will be, according to local media, a 'commercial waterway that will reshape commercial shipping, reap a windfall for investors and haul one of the hemisphere's poorest nations out of poverty.' Heavily backed by Chinese investors, it is deeply unpopular with industry experts and locals alike. There have been lots of questions as to whether there is enough demand for the canal, while its construction will divert scant resources, particularly water, away from agriculture, the country's main industry. The project will, however, contribute significantly to cement demand until its completion, which is expected in 2019.

So is Nicaragua the place to be? Its near-future economic and construction sector outlooks certainly look strong, but the cement industry relies heavily on long-term infrastructure plans, which are sorely lacking. Additionally, none of Nicaragua's neighbouring countries have noteworthy cement deficits. This means that export market opportunities from Nicaragua are in short supply. Nicaragua's future depends overwhelmingly on its leaders' long term-planning abilities...