Displaying items by tag: Anhui Conch

China: On 5 March 2012 Premier Wen Jiabao lowered China's growth target for 2012 to 7.5% from 8%, signalling Beijing's determination to manage a 'soft landing' to moderate its runaway economic expansion. The slowdown will likely hit China's construction sector, which accounts for most of China's rampant cement consumption. China exported only 10.6Mt/yr of cement in 2011, just 1.1% of national output. The worries over China's plans are affecting certainty in all major materials markets.

Credit Suisse described China's more moderate growth target as 'acceptance of slower medium-term growth.' It also said that infrastructure spending was on a downward trend due to the completion of many large highway, railway and airport projects.

Despite this, Guo Wensan the chairman of China's largest cement producer Anhui Conch, has announced that demand for cement remains strong in China. He said that the government's drive to push the construction of subsidised affordable housing is successfully offsetting declining cement demand from the private housing market.

Guo said that cement demand from the 10 million affordable housing units started in 2011 will peak from the second quarter of 2012 onwards. "This year there will be another 7 million public housing starts, so we remain confident," he said. Guo added that the cement industry has benefited from consolidation since the start of 2011, which has seen the removal of older, inefficient kilns and the closure of some companies.

China: China's environment ministry is planning to launch stricter rules regarding nitrogen oxide emissions from cement plants, according to local press. An industry expert said that the policy change could wipe out a third of the industry's total net profits.

The report illustrates the challenges faced by the government to balance pressures for strong economic growth with public demands to lessen pollutants caused by industries that currently operate with few environmental restrictions. China had previously said that it planned to cut the cement industry's overall nitrogen oxide emissions, a key cause of acid rain and photochemical smog, by 10% by 2015.

Chinese Vice Minister of Environment Protection, Zhang Lijun, during a visit to the Anhui Conch Cement Company in January 2012, told accompanying officials and executives that the ministry plans to introduce stricter rules.

Kong Xiangzhong, the president of China's cement industry association, said that the ministry is considering tightening nitrogen oxide emission standards to 400mg/m³ from the current 800mg/m³. "It will translate into huge pressure for the cement industry," Kong was quoted as saying.

China's cement industry, polluting but profitable, has thrived during China's infrastructure spending spree. Anhui Conch, for instance, announced that its 2011 net profit is expected to be at least 80% higher than in 2010. China is the world's largest cement producer, with some 3000 plants producing 2Bt/yr. Beijing announced earlier that it wants to shut at least a third of the country's least efficient cement plants by 2015.

China: Anhui Conch Cement Co Ltd, China's biggest cement producer, plans to add 10Mt/yr of cement production capacity to its annual total by 2015 via overseas expansions. This will include both setting up its own new facilities and acquiring international rivals that are currently weakened by the European debt crisis, according to Wang Jianchao, manager of Anhui Conch's foreign economic cooperation department. Anhui Conch wants to expand its production to other countries because China has restrictions on new cement projects, which aim to combat the industry's overcapacity. The Shanghai-listed company produced 110Mt of cement in China in 2010 according to its annual report.

Jianchao said that the company, which currently has no overseas production, is engaged in a 'go-global' strategy. "Many cement plant owners in the Eurozone want a quick bailout because they need cash to save their businesses, which were hit hard by the European debt crisis," said Wang, adding that the company is moving at the best time to build its overseas operation. He declined to disclose the budget for strategy, but said the company is financially strong enough to expand.

Anhui Conch Cement began its overseas expansion in late June 2011 when it signed a memorandum of understanding to invest USD2.35bn in several Indonesian cement plants. Wang offered no details on the status of the proposed Indonesian projects, but he hinted that the Anhui Conch's first foreign factory may open elsewhere because opportunities in other countries are also being explored.

"Apart from Indonesia, we are in discussions with potential business partners in Mongolia, Central Asia and South America. It's hard to say whether our foreign production will operate in Indonesia first, because other foreign projects may proceed more smoothly," said Wang.

To help its overseas expansion plan go smoothly, Anhui Conch teamed up with the Swedish industrial leader Atlas Copco Group AB to gain access to its cutting-edge mining machinery and training systems. The two companies have a history of cooperation dating to 1993 and the drilling equipment used by Anhui Conch is supplied by Atlas Copco.The Swedish company has a strong customer base in Indonesia.

China: CNBM was China's biggest cement producer in 2010 followed by Anhui Conch and Jidong according to newly-released data from OneStone Research.

In China the top 10 cement producers comprised 817.4Mt/yr (34%) of a cement capacity of 2.41Bnt/yr. The market leader with a capacity of 200Mt/yr (8.3%) was CNBM, followed by Anhui Conch with 150Mt/yr (6.2%) and Jidong with 89Mt/yr (3.7%). Next places in the ranking were taken by Sinoma Cement, Shanshui, Huaxin, CRC, Tianrui, TCC (China) and Hongshi.

Companies in the top 11 – 20 rankings included BBMG, Jinyu Group, Lafarge, Yatai and Asia Cement, combining about 9.5% of China's cement capacity. In total the top 20 companies comprised 43.5% of the national capacity.

The only foreign producer within the top 10 besides Holcim (which hold a 39.9% participation in Huaxin) was Taiwan Cement Corp. (TCC) Other major foreign cement producers in China include Lafarge, CRH, HeidelbergCement, Asia Cement Corp., Taiheiyo, Italcementi, Cimpor and Cemex.