Displaying items by tag: Cementos Artigas

Cementos Artigas inaugurated an upgrade to its integrated Minas plant this week. The joint-venture between Spain-based Cementos Molins and Brazil-based Votorantim Cimentos has been working on the US$40m project since mid-2020. The main plan is to combine the functions of the integrated Minas plant in Lavalleja and the company’s cement grinding plant at Sayago in Montevideo at one site. Key parts of the upgrade included the installation of a new vertical grinding mill, a cellular silo and a bulk cement despatching centre. The Uruguayan president Luis Lacalle turned up for the opening ceremony.

The cement sector in the country is modest compared to those in its much larger neighbours, Argentina and Brazil. It only has four integrated plants with a total production capacity of around 1.4Mt/yr compared to, say, Brazil’s 70-odd plants with a capacity in excess of 85Mt/yr. However, a few things have been happening recently that are worth noting. Firstly, a new integrated plant operated by a new entrant opened in mid-2021. Cielo Azul Cementos y Calizas was set up by investors in Brazil with links to Uruguay. It started in ready-mixed concrete (RMX) in the early 2010s before it contracted FLSmidth in 2017 to build it a 0.6Mt/yr integrated cement plant at La Pacífica in Treinta y Tres. It has also opened an RMX plant in neighbouring Paraguay.

Votorantim Cimentos may have been irked by the opening of a new competitor in Uruguay as it blamed it for a drop in its third quarter revenue in 2022 in its Latin American region outside of Brazil. It described the dynamic in the country as ‘challenging.’ Its local business partner, Cementos Molins, was a bit more balanced in its assessment for 2021, reporting that earnings had falling slightly due to global input cost rises and that sales had fallen due to increased competition from new capacity. Whatever else happens, now that the Minas upgrade project has finished, it seems likely that Cementos Artigas’ costs have the potential to decrease.

The country’s third cement producer, Cementos del Plata, was also busy in 2022. The subsidiary of state-owned Administración Nacional de Combustibles, Alcohol y Portland (ANCAP) announced in September 2022 that is was going to seek a business partner in its business. Its reasoning was that it wants to restore competitiveness to the local cement market and reverse the ‘deficit’ economic situation of the last 20 years. By November 2022, 11 companies had been selected for the next stage of the process. Notable entrants include InterCement-subsidiary Loma Negra, Empresa Publica Productiva Cementos de Bolivia (ECEBOL), Cementos Artigas, Cielo Azul Cementos y Calizas and the Turkish Cement Manufacturers' Association (TürkÇimento). That last name is particularly interesting as it is the only organisation with an obvious link to the cement sector from outside of South America. Two China-based engineering companies are also among the contenders.

Prior to the current initiative to gain inward investment into Cementos del Plata, ANCAP has been noteworthy for union activity at its plants such as strikes in recent years. A reported attempt to privatise the Paysandú plant in 2020 was blocked by the unions, according to local press. In separate news, ANCAP concluded from an investigation in June 2022 that persons unknown had attempted to intentionally damage the kiln of its Minas plant through the introduction of foreign materials. There is no reason to connect the two stories but it does suggest that any investor into the business might want to consider a wide variety of stakeholders as part of any due diligence process.

Uruguay’s cement sector is changing as we have seen above. Cementos Artigas has completed an upgrade to one of its plants, Cielo Azul Cementos y Calizas built a new integrated plant in 2021 and Cementos del Plata is actively hunting for a partner. Just who that new investor might be has implications for the local sector. The Government of Uruguay announced in 2021 that it wanted to set up free trade agreements with China and Türkiye. Unsurprisingly, both Turkish and Chinese organisations are amongst the ones that have made it to the current selection stage.

Uruguay: Cementos Artigas has successfully commissioned its upgraded Minas integrated cement plant. The new plant consolidates the operations of the former 350,000t/yr Minas clinker plant and the 500,000t/yr Sayago grinding plant. Crónica Global News has reported that the project consisted of the construction of a new vertical roller mill and storage facilities at the Minas site. The work lasted 18 months and cost US$40m.

Cementos Artigas says that the Minas integrated cement plant will increase the efficiency and reduce the electricity and transport costs of its operations.

Uruguay: Spain-based Cementos Molins and Brazil-based Votorantim Cimentos subsidiary Cementos Artigas plans to invest US$40m in upgrading its integrated Minas clinker plant with the addition of a vertical roller mill and new cement silos in order to consolidate its clinker production and grinding capacity at the site. The El Periodico newspaper has reported that, as a result, the producer will shut its Sayago grinding plant, leading to a net reduction in production costs of 40%.

Work will begin by early 2021 and the company will commission the new integrated production line in 2022. Cementos Molins chief executive officer (CEO) Julio Rodriguez said, “With this new investment we continue to develop our strategy, in which sustainability and respect for the environment are the first priority. At the same time, it is also a clear sign of our long-term commitment to the Uruguayan market where we have been present since 1991.”

Uruguay: The Administración Nacional de Combustibles, Alcoholes y Portland’s (ANCAP) Minas cement plant has been shut for two months due to union action. The cement producer has been forced to supply cement from its Paysandu plant instead, according to the El Pais newspaper. If the situation continues then ANCAP may need to buy cement from its competitor Cemento Artigas.

ANCAP’s cement division has accumulated debts of US$207m since the early 2000s. Revenues have been reportedly lower than costs since 2004. ANCAP started a restructuring plan at the cement producer in 2017.

Spain: Cementos Molins has sold 10.61% in its Argentina-based unit Cementos Avellaneda to Votorantim Europe for Euro45.2m. Following the deal Cementos Molins retains 51% in the company and Votorantim Europe, part of Brazilian group Votorantim, is holds 49%. The Spanish firm also transferred a 12.61% stake in its Uruguayan-based unit Cementos Artigas to Votorantim Europe for Euro19m, keeping 49% in the subsidiary and its partner raised its stake to 51%.