Displaying items by tag: Cementos Argos

Colombia: Cementos Argos has announced its new commitment to reduce the CO₂ emissionsfrom its cement operations by 29% over a period ending in 2030. The company has additionally committed to producing all of its concrete CO₂-neutrally by 2050. It said that its strategy will comprise several carbon mitigation techniques, including maximised alternative fuel (AF) substitution, clinker factor reduction, energy optimisation, clean technology upgrades and a diversification of its range of its cement range to include more sustainable products.

Chief executive officer Juan Calle said "We are determined to face this important challenge and we are convinced that we can build the future we have planned and achieve a more prosperous, inclusive and low-carbon world if we work together with determination to accelerate this transition." He added "We will continue to strive to implement tangible actions, achieve measurable progress each year and deliver information about out opportunities and progress transparently."

Colombia: Cementos Argos has signed a contract with Klaveness Digital for the supply of the latter’s CargoValue cement terminal logistics platform throughout its supply chain. The move follows a successful trial project carried out by the parties during the second quarter of 2021. Cementos Argos says that it solidifies its digitisation agenda to preserve its strong market foothold in the Americas.

Trading and business intelligence senior director Gabriel Ballestas said “Our business model is focused on the customer and on creating added value for our stakeholders. CargoValue has enabled us to digitise existing processes to improve visibility and make better decisions throughout the supply chain towards that goal.” He added “This wider rollout will improve collaboration between stakeholders and allow us to identify and improve supply chain efficiencies between sites.”

Our latest look at South America starts by posing the question: how far can the market in Brazil keep growing? As Graph 1 shows below, cement sales skyrocketed through the coronavirus pandemic, due to a general recovery locally that started in 2018 and relatively weak lockdown measures compared to other countries. Rolling annual totals on a monthly basis from the National Cement Industry Association (SNIC) suggest that this growth period tailed off from May 2021. SNIC was also keen to point out that, despite nearly hitting nearly a 20% growth rate at one point, the sector was still 11% behind where it was before the lull that lasted from 2015 to 2018. As ever the association has an eye on potential risks. At present these include legislative reforms, price inflation and carbon pricing. It noted that Mexico, Colombia, Chile and Argentina all price carbon already but said that the country ‘has a great ally in the Brazilian cement industry’ on the issue.

Elsewhere the big story in Brazil has been the ongoing sale of Holcim’s local assets. The latest news at the start of August 2021 was that the bidders included CSN Cimentos, Cimentos Mizu, Cimento Apodi, InterCement and Votorantim. The first three companies were reportedly working in a consortium in an attempt to buy 10 production plants while InterCement and Votorantim were focusing on smaller bids to avoid the ire of the competition regulators. Aside from this, CSN Cimentos agreed to buy Cimento Elizabeth for US$220m in July 2021 and Companhia Nacional de Cimento (CNC), part of Italy-based Buzzi Unicem’s 50% subsidiary BCPAR, acquired CRH Brasil following approval by the regulators. Of note on the production side, Votorantim Cimentos started operation of a new production line at its Pecém grinding plant in Ceará in July 2021.

Graph 1: Cement sales in selected South American countries in first half of year, 2019 – 2021. Source: Local cement associations and national statistics offices.

Over in Peru the now familiar gap-tooth pattern of stunted growth in 2020 can be seen in the sector’s cement sales, but sales rebounded far stronger than comparable sized markets in Argentina and Colombia. Sales nearly doubled to 6.42Mt in the first half of 2021 from 3.33Mt in the same period in 2020 and were significantly higher than the 4.94Mt recorded in the first half of 2020. Imports are also worth watching. Combined cement and clinker importers nearly doubled from 0.76Mt in the first half of 2019 to 1.4Mt in the first half of 2021. Clinker imports made up about two thirds of this figure and the Association of Cement Producers (ASOCEM) noted in June 2021 that 88% of the imported cement came from Vietnam while about two thirds of the clinker came from Japan and Indonesia.

Away from the market data, both Cementos Pacasmayo’s and Unión Andina de Cementos’ (UNACEM) financial results bounced back in the first half of 2021. Cementos Pacasmayo attributed the rebound to sales of bagged cement to the self-construction sector and public sector reconstruction demand. UNACEM also noted the effect of the self-construction sector and said it expected its ‘solid’ cement despatches to continue for the rest of the year despite the risk of a third wave of coronavirus in the country and the messy presidential elections. Other stories of note so far in 2021 include new developments in Cementos Interoceanicos long-held plans to build a 1.0Mt/yr cement plant in Puno and a major upgrade planned to Yura’s integrated plant in Arequipa.

In Colombia local cement despatches grew by 34% year-on-year to 6.20Mt in the first half of 2021 from 4.61Mt in the same period in 2020. Cementos Argos reported major improvements in sales, sales volumes of cement and earnings due to the lockdown in 2020. However, a national wave of protests calling for social reform that started in the spring of 2012 forced the company to shut down its integrated Yumbo plant for over a month. This represented 18% of its national sales. The output of other plants in the country was also negatively affected by roadblocks created by the unrest. Cemex reported the same problems in the country.

Finally, Argentina’s cement despatches rose by 44% to 5.52Mt in the first half of 2021 from 3.83Mt in the same period in 2020. Loma Negra reported that its sales, sales volumes and earnings were all up by a similar rate. The subsidiary of Brazil-based InterCement started up the kiln on its new 2.7Mt/yr production line at the L’Amalí cement plant in Olavarría in June 2021 and commissioning of the new mill and despatch centre on the line were reportedly coming soon in early August 2021. Earlier in the year, in May 2021, Holcim Argentina inaugurated a new 0.5Mt/yr clinker production line at its Malagueño cement plant in Cordoba. These expansion projects were ordered long before coronavirus appeared so it will take a while to see their effects upon the local market. However, the government intervened in June 2021 when it persuaded some building materials producers to agree to reference prices in a bid to curb mounting inflation.

This is what recovery looks like so far in 2021 in the larger cement producing countries in South America. The Brazilian market’s growth phase may be waning after a furious period that even coronavirus wasn’t allowed to slow. Peru’s potential seems set to take off, Colombia’s rebound should have been greater (but it was dented by social unrest) and Argentina seems to be resetting to its usual level. Whatever else happens in the coming months the story to watch going forward will be which company picks up Holcim’s assets in Brazil.

Colombia: London Stock Exchange Group subsidiary FTSE Russell has listed Grupo Argos subsidiary Cementos Argos among the top companies on its FTSE4Good environmental, social and governance sustainability index. The index evaluates company performance across 150 indicators including water efficiency, health and safety, labour standards, human rights, fiscal transparency and anti-corruption.

Legal and Sustainability Vice President María Isabel Echeverri said, “We are very excited about being included in the FTSE4Good because it recognises the importance of sustainability management and value creation for us, as well as the efforts we have been making to communicate our goals in a transparent and timely manner in environmental, social commitments and government aspects.”

Colombia: Grupo Argos subsidiary Cementos Argos recorded consolidated sales of US$1.30bn in the first half of 2021, up by 11% year-on-year from US$1.17bn in the first half of 2020. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 30% to US$267m from US$205m. Cement shipments were 8.60Mt, also up by 30%, from 6.62Mt. The company said its performance was ‘solid’ in every region in which it operates. The sharpest sales increase was in Colombia, where sales rose by 38% to US$314m from US$228m and cement shipments rose by 40%. It continued to execute its BEST efficiency programme and RESET plan for a sustainable restart post-Covid-19 pandemic. Additional challenges included 40 days of roadblocks in Colombia and political and a period of social instability in Haiti.

Cementos Argos’ CEO Juan Esteban Calle said “We are very satisfied with the figures achieved during the first half of the year in our three regions, and we are optimistic about the future for our customers, the progress of their housing and infrastructure projects, which are contributing significantly to employment recovery, as well as the levels of economic activity and the creation of social value in all the countries and markets where we are present, and with the noteworthy recovery of the company's financial flexibility in recent months, which is thanks to the commitment, creativity, passion and innovation of all our employees and to the success in the deployment of the BEST and RESET programmes.”

He added “Our strategy of creating social value is at the centre of the corporate strategy and in our higher purpose, and today, we are reassuring our commitment to contribute to the reactivation of the economy and to closing equality gaps. During the first half of 2021, we continued investing in the expansion of Cartagena Port, which generates additional employment and brings great social investment to the area. Additionally, we are making progress in initiatives such as Casa para Mi and Hogares Saludables that will allow us to contribute to the dreams of having decent housing for thousands of people in the country.”

US: Colombia-based Cementos Argos subsidiary Argos USA’s Newberry, Florida cement plant produced 140,000t of cement in June 2021. The plant shipped 129,000t of cement. The company says that the production figure beats its previous production record of 128,000t in June 2019 by 9%. The figure for shipments beats the previous shipment record, also from June 2019, of 121,000t by 7%.

Plant production manager Daniel Ball said, “Everyone at the Newberry Plant is excited and proud to see these records being set. With the current sales climate, we are able to show the untapped potential Newberry has. This sustained sales commitment would not be possible if it wasn’t for all the hard work and dedication of everyone at the plant as well as from Argos plant support staff and Argos Corporate. But with the new record set, we strive to set new records going forward.”

US: Colombia-based Cementos Argos is planning to export 0.4Mt of cement to the US in 2021. The cement producer’s exports to the country grew by 419% year-on-year to 135,000t in the first five months of 2021 from 26,000t in the same period in 2020. It says that it expects the US cement market to grow by 2.2% year-on-year in 2021.

The company is currently upgrading its integrated plant in Cartagena, Colombia and improving the associated port terminal. The US$40m project is scheduled to be completed in the second half of 2021. It is intended to support the export market to the US and elsewhere.

Puerto Rico: Colombia-based Grupo Argos subsidiary Cementos Argos has combined the distribution capacities of its Dorado and San Juan cement terminals at the Dorado site. It recently upgraded the terminal with a new mixing system and 3000 bags/hr packaging system, up by 100% from 1500 bags/hr previously. New sensors have improved safety, while efficiency and reliability have both also increased. The company said that the consolidation has enabled it to expand its portfolio of products on offer at the major Caribbean hub.

Caribbean and Central America regional vice president Camilo Restrepo said, “At Argos, we ensure the high reputation Argos Colombia is maintained wherever we go. We are convinced that this transformation in Puerto Rico will only serve to benefit our clients. We have the assets, the capabilities, the talent and all the passion to satisfy the island's needs, all while strengthening our export vocation in the Caribbean, making this operation an important commercial maritime hub.”

Colombia: Grupo Argos has formed an alliance with five other Colombian companies to boost the number of women and young people in work. The alliance will focus on creating sustainable and competitive job opportunities. The participants say that they will jointly offer 6000 mentorship places. Youth and female unemployment respectively rose to 25% and 31% nationally during the on-going Covid-19 outbreak. Grupo Argos said that it is part of its corporate social responsibility to take action to create quality work.

US: Colombia-based Grupo Argos subsidiary Cementos Argos has agreed to sell its 24 ready-mix concrete plants in Dallas, Texas, to SRM Concrete. The Diario Financiero newspaper has reported the value of the deal as US$180m. Cementos Argos called the sale an ‘important milestone’ in the fulfilment of its non-strategic asset divestment plan.