Displaying items by tag: China

Several of South Africa’s cement and concrete producers joined up in early March 2021 to form an industry association called Cement & Concrete SA (CCSA). The Concrete Institute, Concrete Society of Southern Africa and the Association of Cementitious Material Producers established the organisation to, “take the lead on all matters relating to cement and concrete in South Africa.” Setting up an organisation like this takes time and it fits with the move in recent years of thinking about the whole building materials chain rather than just focusing on one part. The country is also in the first phase of its carbon tax and no doubt producers feel they need to make a renewed effort to fight their corner. Other aspects such as promoting the ‘value creation story’ of the cement and concrete industry in South Africa, research and training also makes sense.

The timing here is compelling due to the ongoing review of anti-dumping measures that were levied by the International Trade Administration Commission of South Africa (ITAC) upon imports by Pakistan-based cement producers. Local media in South Africa reported that ITAC started reviewing the tariffs in December 2020 in a process expected to take up to 18 months in duration. As reported in January 2021 (GCW 489), imports to the country fell after ITAC introduced tariffs in 2015 but they have started to edge up since then, particularly from producers in other countries such as Vietnam and China. Separately, the CCSA may have scored an early victory with the news that its application that government-based infrastructure projects should only use locally-produced cement was working its way through the government.

Looking at the general market, PPC reported ‘muted’ sales of cement in April and May 2020 due to the country’s first coronavirus-related lockdown from late March 2020. Similar to some other countries, construction projects halted and cement plants stopped producing. However, the market bounced back as the restrictions were relaxed with strong sales from June 2020 to September 2020 for the leading producer. It noted that the increase in volumes was mainly due to consumer retail although it noted that government infrastructure cement demand was also starting to be felt. PPC’s cement sales volumes fell by 5 – 10% in South Africa and Botswana from April to June 2020 but then rose by 20 – 25% from July to September 2020. The continuation of this sales momentum was also noted in October and November 2020. Dangote Cement’s operations in the country reported a similar situation, with sales up by 7% year-on-year in the first nine months of 2020 due to a surge in home improvement related demand after the first lockdown ended. Similar to PPC, it reckoned that demand increased by 25 - 30% year-on-year in the third quarter of 2020 as limitations in travel and entertainment led to some people saving money instead.

After the summer sales bounce, producers were soon complaining about rising import levels in the autumn of 2020 with volumes catching up with the amounts recorded in 2019. Hence the ITAC review is a timely reminder of the perils facing local producers.

South Africa’s general coronavirus experience has been an outlier compared to the rest of Africa with higher cases and deaths reported. Yet, it’s still reported lower per capita rates than many comparable countries in Europe and the Americas. Like the UK and Brazil, the country also holds the dubious distinction of having a coronavirus variant named after it. Its cement market appeared to snap back with pent up demand following the lifting of restrictions in common with other countries that implemented tougher public health rules. At which point the importers caught up again a few months later. The effects of South Africa’s second wave of coronavirus led to a lockdown in late December 2020. The effects upon building materials sales are likely to be less drastic than previously because this lockdown has had lighter restrictions compared to March 2020. Surrounded by all of this, the CCSA has sure picked a busy time to start work.

China: Jidong Cement’s operating income rose by 3% year-on-year to US$5.46bn in 2020 from US$5.31bn in 2019. Its net profit attributable to shareholders grew by 5.5% to US$438m from US$415m. The large-scale producer said that its clinker and cement production capacities reached 117Mt/yr and 170Mt/yr in the reporting period. It operates in Hebei, Beijing, Tianjin, Shaanxi, Shanxi, Inner Mongolia, Jilin, Chongqing and Henan with a focus in the Beijing-Tianjin-Hebei region.

China: China Resources Cement’s turnover rose by 3% year-on-year to US$5.16bn in 2020 from US$5.02bn in 2019. Its profit attributable to shareholders was US$1.15bn, up by 4% year-on-year. Sales volumes of cement grew by 6% to 87.3Mt from 82.5Mt. Volumes increased in Guangdong, Guangxi, Yunnan and Guizhou but decreased in Fujian, Hainan and Shanxi.

In February 2020 the cement producer completed the construction of one 1.4Mt/yr clinker production line and two cement grinding lines with a combined cement production capacity of 2Mt/yr in Anshun City, Guizhou. Also in 2020 the group commissioned one new concrete batching plant and shut down two others.

During the reporting year the Group co-processed 183,100t of municipal solid waste, 52,800t of urban sludge with an 80% moisture content and 6100t of hazardous industrial waste. It operates seven co-processing projects with four more either under trial operation or under construction. It also said that it had been following policies for carbon emissions with trial activities conducted in preparation for a future unification of national carbon market. Eight company plants in Guangdong and five in Fujian were reported as having settled their carbon credit quota for 2019.

Other operations of note include the start of Phase 1 of the group’s intelligent manufacturing pilot project at a unit in Tianyang in conjunction with Siemens. The group has also commenced trial operation of its in-house developed intelligent manufacturing system at a cement plant in Pingnan, Guangxi. The project interacts with system quality management systems and advanced kiln controls. The next step will be to use the quality management system at cement plants in Shangsi and Guigang, Guangxi. A so-called ‘lighthouse plant’ is also planned to work with environment, health and safety, operation, production, equipment, quality, mines and logistics at a cement plant in Fengkai County, Guangdong. The group’s platform for sharing auxiliary materials and spare parts was launched in Fujian in April 2020 and has since been rolled out to sites in Guangdong, Guangxi and Hainan. Finally, the company’s ‘Smart Card’ logistics system has put into operation at cement plants in Fengkai, Huizhou, Luoding and Dongguan, Guangdong and has been operating at 25 cement production plants by the end of 2020.

Ethiopia: East African Holding and China-based West China Cement have formed a joint venture. The Xinhua News Agency has reported that the partners plan to establish a multi-industrial complex in Ensaro Woreda district, Amhara regional state. Called Lemmi National Cement complex, the facility will house a 10,000t/day cement plant in addition to other industrial plants. The partners say that the facility will create 5000 jobs.

The first phase of the project will establish the cement plant and reach completion in late 2022.

US: Data from the US Geological Survey (USGS) shows that cement producers achieved volumes of 87Mt of Portland cement in 2020, a slight increase from 2019 levels. Portland and masonry cement volumes rose by 1% year-on-year to 89Mt from 88Mt, while clinker volumes remained level at 79Mt. Total cement shipments remained level at 103Mt. The value of shipments in 2020 was US$12.7bn. Total exports of cement and clinker were 1.0Mt, down from slightly over 1.0Mt in 2019. The USGS said that on-going upgrades, closed and mothballed plants, low capacity utilisation and relatively inexpensive imports constrained the industry’s growth.

Domestic consumption fell by less than 1% to 102Mt from 103Mt. Cement imports totalled 15.0Mt, up slightly from 14.7Mt, while clinker imports rose to 1.4Mt from 1.2Mt. This corresponded to a 15% rise in reliance on imports of cement and clinker. The main exporters of cement and clinker to the country were Canada, accounting for 33% of US imports, Turkey (16%), Greece (15%) and China (12%).

China: Anhui Conch Cement recorded consolidated sales revenue of US$27.0bn in 2020, up by 12% year-on-year from US$24.0bn in 2019. Its net profit rose by 5% to US$5.38bn from US$5.14bn.The company said that its total assets were US$30.8bn in 2019, representing an increase of 12% from the end of last year.

China: Starlinger says that its Ad*Star bag has received designation as one of three types of national standard cement bag type specifications by the Chinese government. The supplier developed the block bottom valve bags made of woven polypropylene tape fabric in 1995. Global production was 15.7bn in 2020.

The new Chinese standard for cement packaging was released in October 2020. It applies to cement bags holding up to 50kg and lists laminated woven plastic bags (made of one layer of laminated plastic fabric or with additional paper liner), paper bags (three-layer, three-layer with PE liner, four-layer bags), as well as paper-plastic composite bags (paper bags with plastic liner) as possible packaging options. All three types of bags must be designed as block bottom valve bags.

The standard specifies the dimensions as well as physical and mechanical requirements of the cement bags. Regarding break resistance, for example, a cement bag has to survive a drop from 1m height a minimum of six times before it breaks. Furthermore, printing and marking, general bag appearance, testing methods, and rules for quality inspection during bag manufacture are established in the standard. It also stipulates that each bag must be provided with a certificate before selling.

Local cement companies have been given a transition period until 31 March 2022 to adapt to the new standard. Starlinger expects to deliver and install machines for an additional production capacity of more than 2 billion Ad*Star bags on the Chinese market in 2021 and 2022.

China: China National Building Materials (CNBM) plans to increase its stake in Tianshan Cement to 88% from 46% as part of its restructuring drive. Tianshan Cement will acquire outright fellow CNBM subsidiaries China United Cement and Sinoma Cement. It will also acquire CNBM’s majority stakes in Southwest Cement and South Cement. The group says that it has completed the audit, evaluation and evaluation filing for the reorganisation. It follows an announcement in the summer of 2020 about the plan.

In a related transaction, Tianshan Cement said it had agreed to buy Jiangxi Wannianqing Cement’s 1.3% stake in South Cement. Reuters has reported that value of this deal as US$96.0m.

CNBM said that the restructuring is intended to, “promote the integration of high-quality resources, strengthen the company’s leading position in the cement industry and facilitate resolving industry competition among subsidiaries of the company in the cement business sector.”

China: The government of Jiangsu province has awarded an Environmental Protection certificate to Imerys subsidiary Calderys’ Zhangjiang refractory plant. The company said that the certification results from years of hard to enhance environmental efforts beyond national requirements. One example of the work is dust-proof partitioning around all dust-emitting equipment.

Environment, health and safety supervisor Ricken Ren said, “In 2016, the plant improved the quality of its raw materials. With major work no longer required to lessen the water content of the materials, it was able to reduce the use of its dry kiln, which uses natural gases in its drying process, in turn greatly reducing the plant’s energy consumption. ” He added, “Keeping the plant’s environmental impact as low as possible is a never-ending job, and we cannot lose focus. We perform daily checks to ensure devices such as our dust collectors are working effectively, and we are always monitoring our emissions during operation according to national laws. Every department worked together on environmental protection performance. It is a great teamwork result.”

Switzerland: LafargeHolcim’s consolidated net sales in 2020 were Euro21.1bn, down by 5.6% year-on-year on a like-for-like basis from Euro24.4bn in 2019. The group recorded recurring earnings before interest and taxation (EBIT) of Euro3.35bn, down by 2% from Euro3.74bn. Its cement sales fell to 190Mt, down by 7% from 208Mt. It noted an increase in bagged cement sales in emerging markets.

By region the group reported like-for-like growth in sales and earnings in Asia-Pacific driven by recovery in India and China despite weaknesses in the Philippines and Australia. Earnings rose despite falling sales in Europe, Latin America and North America with a resilient market noted in Central Europe and an ‘outstanding’ year reported in Latin America. Middle East Africa reported falling cement demand and adverse market affects from the coronavirus pandemic, although Nigeria remained buoyant.

Chief executive officer Jan Jenisch said, “2020 was an unprecedented year for everyone, challenging us to be more resilient, while stepping up to take care of those around us.” He added, “This crisis has really proven the resilience of our strategy and business model. By the fourth quarter of 2020 we were back to growth, with a 1.5% increase in net sales and over-proportional recurring EBIT of 14%.” The group completed eight ‘bolt-on’ acquisitions in 2020 and signed an agreement to acquire Firestone Building Products, a producer of flat-roofing systems in the US. It also claimed that, “Every tonne of cement we produced in 2020 was more carbon-efficient and contained more recycled material than the year before.”