Displaying items by tag: China

Austria: RHI Magnesita says that its earnings before interest, taxation and amortisation (EBITA) continued to grow year-on-year during the first quarter of 2023. This was despite an 8% year-on-year drop in refractory sales during the period under review. The refractory supplier attributed its declining sales to reduced construction activity outside of China and India. It said that this slowed demand both for cement and steel. RHI Magnesita noted higher energy costs, while raw materials costs 'remained low.' During the first quarter of 2023, the company acquired India-based refractory producers Dalmia OCL and Hi-Tech. These give it a 20 - 30% market share in India. This advanced its goal of strategic growth in markets in which it is under-represented, including China, India and Türkiye.

Chief executive officer Stefan Borgas said “RHI Magnesita benefited from resilient pricing in the first quarter, as we fulfilled orders placed in the fourth quarter of 2022 during the peak inflationary period. Our improved refractory margin performance benefits from the investments we have made to rationalise our network, and leaves us well placed to meet expectations for the year. We have continued to make steady progress in mergers and acquisitions as we identify value-adding opportunities to grow our business through consolidation in key target geographies and product areas, whilst carefully managing our balance sheet."

Ethiopia: Berenta Cement has signed a strategic cooperation framework agreement with China-based Sinoma Cement to build a cement plant at Shebele Berenta in Amhara region. The two companies will form a joint venture to work on the unit, according to the Ethiopian News Agency. The regional government will support the initiative. The wider scope of the project also includes plans to supply products and services such as gypsum, gypsum wallboard, glass and glass fibre.

China: China Resources Cement (CRC) has appointed Jing Shiqin as its chief executive officer. He succeeds Ji Youhon, who will continue to work as the chair of the board, an executive director, the chair of the strategy and investment committee and the chair of the nomination committee.

Jing, aged 42 years, joined China Resources Group in July 2003 and worked as the Deputy General Manager of the Human Resources Department of China Resources Group from 2018 to March 2021, as well as a non-executive director of both the company and of China Resources Gas Group at around the same time. He joined CRC in mid-2021 and was its Vice President until April 2023. Other roles have included being responsible for the management of the Marketing Management Department, the Smart & Information Technology Department and the Technology and Innovation Department. Jing holds a bachelor’s degree in engineering from the Changsha University of Science and Technology and a master’s degree in business administration from the Nanjing University.

Germany: Robert Habeck, the Federal Minister for Economic Affairs and Climate Action, has visited specialist Flender at the Hannover Messe trade fair. He spoke with the company’s head Andreas Evertz about the energy transition goals for Germany and Europe, Flender's role as a supplier for the wind sector, and the importance of an energy-efficient industry on the way to reach global climate goals. The mechanical drive manufacturer was part of the government minister’s official tour of the exhibition.

Habeck said, "Discussing about the expansion of renewable energies, we usually talk about the electrical output, the production. But here at Hannover Messe, we see also the other side of the coin. A lot of the industrial production is here in Germany, or at least with German companies. And when you say the market is now swinging in and growing, that's good news." He added that “It is challenging to bring electricity production out of renewables to 80% of the demand by 2030, but it is possible."

Evertz said "Flender is a major driver of the energy transition. And this starts with any kind of materials. In drive technology, Flender not only manufactures wind gearboxes, but industrial gearboxes that are involved in the production of raw materials for wind turbines. Flender is part of nearly every supply chain."

Other recent interest shown by the German government include a tour by Foreign Minister Annalena Baerbock of Flender’s plant in Tianjin as part of a tour of China.

Kenya: Savannah Clinker, an associate company of Savannah Cement, has raised around US$480m to build a new integrated cement plant in Kitui county. It said it generated the funding through a privately placed debt arrangement with the bond set to be listed at regulated international exchange, according to the Business Daily newspaper.

Benson Ndeta, chairman of Savannah Cement Group, said “I am extremely proud to have the support of a major international investor who shares our vision and beliefs in what is required to deliver the growth and development of our key infrastructure and affordable housing.”

It was announced in December 2022 that China-based Sinoma International Engineering had been contracted to build the 2.92Mt/yr plant with a completion date planned for late 2024.

Ethiopia: China-based Sinoma International Engineering has signed an agreement with National West International Holding (WIH) Building Materials to build an industrial park development project at Dire Dawa. The project has an investment of US$600m and will include a 6000t/day cement plant and a 1000t/day lime unit, according to the Xinhua News Agency. The proposed industrial park is relatively close to the Port of Djibouti, in neighbouring Djibouti, to allow for access to raw materials and potential export markets.

WIH, a joint-venture between companies based in Ethiopia and China, already operates a cement plant at Lemi in Amhara Region.

Huaxin Cement completed its acquisition of a majority stake in Oman Cement this week. The China-based company estimated that the purchase price was around US$193m. Following the transaction with a subsidiary of the Oman Investment Authority, the country’s sovereign wealth fund, the cement producer now controls just under a 60% share in Oman Cement.

A key part of the deal includes Oman Cement’s integrated plant at Ruwi in the north of the country. The three-line unit has clinker and cement production capacities of 2.6Mt/yr and 3.6Mt/yr respectively. With the partial ownership share of 60% taken into account, this places the capacity purchase price at around US$124/t, a lower figure for capacity compared to other international acquisitions.

Oman Cement has a couple of new projects in the pipeline that have been mentioned on and off previously over the last year or so. These include the construction of a new 10,000t/day fourth production line, an upgrade to line 3 to 4000t/day from 3000t/day at present and plans for a new plant at the Special Economic Zone (SEZ) at Duqm. The company said it was looking for a contractor to carry out the upgrades at the Ruwi plant. However, Rashid bin Sultan al Hashmi, the chair of Oman Cement, said in the company’s annual results for 2022 that the Duqm project, operating under the name Al Sahawa Cement, had run into problems with the supply of gas for the proposed unit. Another recent development was the signing of a deal between Omani Environment Services Holding Company (Be’ah) and Oman Cement for the supply of refuse-derived fuel (RDF). As an aside, that last one may also have received a boost this week with the news that the local Environment Authority has suspended licenses for the export of used tyres from the country.

How these existing projects will fare under the new ownership remains to be seen, but Huaxin Cement has a track record for developing new cement production capacity outside of China. The cement producer describes itself as de-facto controlled by Switzerland-based Holcim although Holcim said in its annual report for 2022 that Huaxin Cement is a joint-venture. It currently operates plants in Cambodia, Kyrgyzstan, Malawi, Nepal, Tajikistan, Tanzania, Uzbekistan and Zambia and says that it has 10 additional projects in Africa, the Middle East and elsewhere in preparation for future business expansion. In 2022 it started operating a 3000t/day production line at Nepal Narayani and commenced the second stage of a project to build a 4000t/day clinker line at Maweni in Tanzania. Plus, as mentioned in our recent roundup of China-based producers, 13% of the group’s operating revenue derived from business outside of China in 2022 compared to 8% in 2021.

Other producers from outside of Oman have also been active locally in 2023. In late January 2023 India-based UltraTech Cement agreed a deal to buy a 70% stake in Duqm Cement Project International from Seven Seas for US$2.25m. The agreement covered a limestone mining lease that UltraTech Cement said was important for “raw material security.”

The other big development in the Oman cement market since we last covered the country in September 2021 was an intervention by the Capital Market Authority (CMA) on Raysut Cement. The chief financial officer resigned in November 2022 before the CMA questioned the company’s financial results for the second quarter of 2022. The CMA then replaced the board of Raysut Cement in December 2022 saying it had detected ‘material misrepresentation’ in the company’s third quarter results.

The last four months or so have marked a turning point for the local cement sector with a change in leadership for the two largest producers. Oman Cement reported strong growth in 2022 although it warned of “low priced cement being supplied by competitors.” Raysut Cement, unsurprisingly, recorded a loss in 2022. The construction market in the country is expected to grow as the economy leaves the coronavirus period behind, mounting energy prices boost national revenue and potentially some of this heads into infrastructure development. This puts the new management at both producers in a good position going forward.

Oman: Oman Cement has appointed Xu Gang, Chen Qian, Ian Riley and Li Yeqing as temporary board members following its acquisition by China-based Huaxin Cement. The new personnel will remain in place until the company’s next ordinary general meeting. Former chair Rashid Sultan Al Hashmi and board members Mohammed Sulaiman Al Salmi, Mohammed Abdullah Al Harthi and Sami Abdullah Al Sinani have also resigned.

Li Yeqing is the chief executive officer (CEO), secretary of the party committee and senior engineer at Huaxin Group. He holds a bachelor degree in engineering, a master’s degree in engineering and a Ph.D in business administration. He joined Huaxin Cement in 1987. He also works as the vice chair of the China Building Materials Federation and China Cement Association, and chair of the Hubei Building Materials Federation. He previously held the post of executive vice chair of the Sixth Council of China Building Materials Federation.

Xu Gang is the vice president of the Huaxin Cement. He has worked in various management roles for cement companies such as safety engineer and technical manager. He has also worked as a director for Lafarge and Huaxin Cement. Xu Gang holds a master’s degree in business administration (MBA) from Tsinghua University, a bachelor’s degree in safety engineering from the China University of Geosciences and a bachelor's degree in financial management from the Huazhong University of Science and Technology.

Ian Riley is the head of the World Cement Association. Prior to this, he held various positions such as an executive director of Tianqiao International (Shanghai) Consulting Company, the president of Asilinko Information Technology (Shanghai), the general manager of SIP (Shanghai), Information Director and the assistant and the vice president to the Xeroc. He also served as the head of Holcim Group's China region. Riley holds a bachelor’s and a master’s degree in engineering from the University of Cambridge.

Chen Qian is the vice president and chief financial officer (CFO) of Huaxin Group. Previously he held positions in various financial positions including senior auditor, senior consultant and CFO for several companies. Chan Qian is a Chinese Certified Public Accountant and a fellow member of the Chartered Global Management Accountant. He holds a bachelor's degree in world economics from Fudan University and a master's degree in business administration from the Anderson School of Business in the US.

China: China Resources Cement has forecast a loss of US$4.46 – 5.73m during the first quarter of 2023, which ended on 31 March 2023. Dow Jones Institutional News has reported that the group attributed the anticipated scale of the loss to a year-on-year decline in its cement prices.

China: Xinjiang Tianshan Cement has secured board approval for an issue of commercial paper. Reuters has reported the total value of the paper as US$2.19bn.