Displaying items by tag: Bangladesh

Bangladesh: LafargeHolcim Bangladesh has unveiled its Supercrete Portland limestone cement (PLC) bag redesign. The new bag features the tagline ‘Top quality, proper construction’ in Bengali. The Switzerland-based LafargeHolcim subsidiary produces the cement with limestone from Meghalaya, India. It says that its product is the only PLC on the Bangladeshi market.

Vietnam: Vietnam’s cement exports totalled 14.9Mt in the first four months of 2021, up by 42% year-on-year from the levels in the corresponding period of 2020. China imported 7.38Mt (50%) of Vietnamese cement exports, up by 53% year-on-year. The Philippines imported 2.51Mt (17%), up by 17%, and Bangladesh imported 1.87Mt (13%), up by 38%.

The Viet Nam News newspaper has reported the total value of Vietnamese cement exports for the period as US$563m. China’s value of Vietnamese cement imports was US$258 (46%), the Philippines’ was US$112m (20%) and Bangladesh’s was US$63.1m (11%).

Bangladesh: Cement producers are warning of price rises due to a ‘significant’ rise in international freight rates. The Bangladesh Cement Manufacturers Association (BCMA) has expressed concern about the situation, according to the New Nation newspaper. Freight rates to transport clinker from Indonesia, Vietnam or the Middle-East have increased by up to 30% in the last few months. The BCMA has called on the government to cut import duties to keep consumer prices low.

Vietnam: SSI Research has predicted that Vietnamese cement exports will not grow in 2021. The reason for this is the expected stabilisation of China’s domestic cement supply, which is forecast to increase its share of the market. The Viet Nam News newspaper has reported that China accounts for 57% of Vietnamese cement and clinker exports. Other factors restricting export growth are safeguard duties in Bangladesh and the Philippines and the Vietnam government’s mandatory minimum domestic sales regulations, variously between 65% and 70% of total output.

A great question was asked at yesterday’s Virtual Global CemTrans Seminar: what impact did the recent blockage of the Suez Canal cause to the cement industry? Luckily, Rahul Sharan from Drewry was on hand discussing freight costs following the start of the coronavirus pandemic.

As most readers will know, the Suez Canal was blocked in late March 2021 when the 200,000dwt Ever Given ran aground, at around six nautical miles from the southern entry of the canal. The ultra large container vessel was subsequently refloated and towed away just under a week later. While this was happening the fate of the ship became a global news story with business analysts totting up the cost of the obstruction. 40 bulk carriers were reported as waiting to transit the waterway the day after the blockage started and some of these were carrying cement. Reporting by the BBC noted that 369 ships were stuck waiting on either side of the blockage on the day before the ship was finally freed. The Suez Canal Authority (SCA) estimated their loss of revenue from the incident at US$14 – 15m/day. Analysts like Allianz placed the cost to the global economy at US$6 - 10bn/day.

In Sharan’s view the blockage of the Suez Canal happened at a potentially risky moment for cement and clinker shipping because there was already congestion in shipping lanes built up on the east coast of South America and around Australia. However, a delay of a week around the canal, followed by the resulting congestion dispersing quickly over the following days, does not seem to have had any major impact so far.

Sharan’s presentation at Global CemTrans also included a summary of cement shipping. The key takeaways were that clinker shipping overtook cement shipping in 2019 with a connected increase in fleets investing in handymax-sized vessels. He also pointed out the key cement and clinker importing countries in 2019, before the coronavirus pandemic started causing market disruption. For cement: the US, the Philippines and Singapore. For clinker: China, Bangladesh and the Philippines. Turkey and Vietnam were the biggest exporters for both in that year.

The Ever Given incident has highlighted the continued importance of the Suez Canal for global trade for commodities. Goods still need to be physically moved around, however much stuff we digitise. It also contrasts with the issues that the Egyptian cement sector has faced in recent years such as production overcapacity. While domestic cement plants have struggled to maintain their profits, plenty of cement carriers have been transiting through the Isthmus of Suez. Local producers may well have gazed at them and wondered where they were going.

One of them, Al-Arish Cement Company, took action in this direction this week with its first export shipment of clinker. The Clipper Isadora ship disembarked East Port Said port for Ivory Coast. Future shipments are planned for West Africa, Canada, the US and Europe. Ship tracking reveals that the Clipper Isadora has not taken the Suez Canal on this occasion.

The proceedings pack for the Virtual CemTrans Seminar 2 2021 is available to buy now

Indonesia: Semen Indonesia has detailed its plans for future exports of cement to North America. The Investor Daily newspaper has reported that the producer and subsidiary Solusi Bangun Indonesia will target 0.5 – 1Mt of cement exports to North America in 2021, according to president director Hendi Santoso. The export plans will be carried out in partnership with Japan-based Taiheiyo Cement, which already has a US market presence and owns a 15% stake in Solusi Bangun Indonesia. Hendi said that the move aims to ‘cushion’ the decline in domestic cement sales, down by 28% bulk and 13% bagged year-on-year in 2020. The company successfully exported cement to Australia, Bangladesh, China, Fiji and Sri Lanka in 2020.

President commissioner Rudi Antara said, "The Covid-19 outbreak still colours our lives. There is no other choice but to increase business efficiency and the top line outside of our main markets."

Bangladesh: Protesters in Chhatak, Sunamganj District have accused LafargeHolcim Bangladesh of selling limestone illegally. The New Nation newspaper has reported that protesters allege that the company sold imported Indian limestone on the open market. They allege that the limestone was imported exclusively for use as a raw material in cement production under Bangladeshi tax law.

Bangladesh: Cricketer and Bangladesh national team captain Tamim Iqbal has secured a brand ambassador contract with Seven Rings Cement. United News of Bangladesh has reported that the parties signed the contract at a ceremony at which director and chief executive officer Raihan Ahmed and chief financial officer and company secretary Kausar Alam were in attendance.

Iqbal said, “I am very proud to be associated with Seven Rings Cement, which is the only cement company that has three cement plants in three different places in Bangladesh."

News has been dripping out slowly over the last few months about which assets HeidelbergCement is planning to divest. This week reporting from Bloomberg suggested that the German-based building materials producer might be seriously considering selling one or more integrated plants in Spain. The idea is reportedly part of a wider review of its portfolio in the country with the possible inclusion of cement plants at San Sebastian and Bilbao at a future date also. A proposed price of Euro300m for the national business was put forward by the sources to the reporters but it is unclear how many cement plants that figure includes.

HeidelbergCement announced in July 2020 that it had reduced the value of its total assets by Euro3.4bn following a review. It blamed this on reduced demand for building materials due to the coronavirus pandemic and the devaluation of its Hanson subsidiary in the UK, in part related to the UK’s exit from the European Union. A divestment plan followed at its Capital Markets Day event in September 2020 when it said it was simplifying its country portfolio and prioritising the strongest market positions. To this end it said it was setting up a watch list of underperforming assets to keep an eye on.

Over the next few months a number of corporate reorganisations and actual confirmed divestments occurred as well as plenty of speculation. HeidelbergCement-controlled Suez Cement started to acquire a 100% stake in its own subsidiary, Tourah Portland Cement, in September 2020. Suez Cement then sold its majority stake in Kuwait-based Hilal Cement in late January 2021. This week HeidelbergCement Bangladesh informed the local stock exchange that it is planning to amalgamate its subsidiary Emirates Cement.

Signs that European reviews had taken place could be seen later in the autumn of 2020. In November 2020 the Italian press picked up on rumours that HeidelbergCement was planning to move subsidiary Italcementi’s research centre from Bergamo, Lombardy, to Heidelberg in Baden Württemberg. Whether this was ever a serious proposition or not, this appeared to have been avoided in early February 2021 when an Italian union said it had agreed with Italcementi to keep the research centre in Italy as well as a preserving jobs generally. Meanwhile, also in November 2020, France-based subsidiary Ciments Calcia announced a major upgrade at its integrated Airvault cement plant but along with the conversion of two other integrated plants into a grinding unit and a terminal respectively, and changes at the French headquarters at Guervill.

Just before Christmas the bigger speculations started to appear in the press, with a story suggesting that HeidelbergCement was considering selling assets in California, US, with a target price of US$1.5bn for three integrated plants and associated concrete and aggregate units. That story is particularly beguiling given Cemex’s decision this month to reopen a kiln in Mexico to supply cement to the southwest US to meet shortages (See GCW 493)! Incidentally, readers should also note the story this week about a shortage of natural gas exports from Texas, US, that has caused cement plants in northern Mexico to shut down. This week, as mentioned at the start, has seen Spain added to the list of places that HeidelbergCement might be considering selling up in. The Spanish market like Italy has been rationalising heavily over the last decade particularly as export markets have dwindled. Oficemen, the Spanish cement association, reported that domestic cement consumption fell by 10% year-on-year to 13.3Mt in 2020 from 14.7Mt in 2019. On top of this Oficemen has repeatedly warned of the threat that CO₂ emissions prices pose for its members’ exports.

Group chairman Dominik von Achten told Reuters this month that the company plans to sell the first of the five assets in early-to-mid 2021. Of course he wouldn’t say where, except for adding that the company would stay in ‘rock solid’ markets like Northern Europe. Indonesia has been seen as a candidate for disposal by analysts, likely due to local production overcapacity levels and LafargeHolcim’s own departure in Indonesia 2018. All Von Achten would say on the matter was that Indonesia was an ‘important’ market for the group. Whether it’s seen as important for reducing company debt or building value remains to be seen. HeidelbergCement hasn’t exactly been shy about saying what they are doing over the last half year or so but they are only going so far and they won’t comment on speculation. So in the meantime we must wait to find out more.

Bangladesh: HeidelbergCement Bangladesh plans to amalgamate its subsidiary Emirates Cement. The Daily Star newspaper has reported that fellow HeidelbergCement Bangladesh subsidiary Emirates Power Company will also be merged as part of the reorganisation.

The subsidiary of Germany-based Heidelberg Cement acquired Emirates Cement Bangladesh and Emirates Power for around US$21.5m in 2019. Emirates Cement Bangladesh operates a plant at Munshiganj with a production capacity of 0.66Mt/yr.