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News GCW478

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Update on the US: October 2020

21 October 2020

Ed Sullivan was present to tell Global Cement Live viewers about the Portland Cement Association’s (PCA) autumn forecast last week. The PCA expects US cement consumption to drop by 1.5% year-on-year on 2020. This is a weighted average of its three projections, which cover a gradual recovery from coronavirus-related economic disruption, a less controlled scenario and one where wide-spread vaccination has a positive effect in the second half of 2021. The first scenario is the PCA Market Intelligence’s most likely one but only the fast vaccination scenario predicts a return to growth in 2021. This is wide but understandable deviation from the PCA’s autumn forecast in 2019 that expected moderate growth albeit a slowly weakening economy. Almost nobody seriously expected 2020 to turn out like it has. Follow the link at the bottom of this article to view the presentation in full.

Graph 1: Portland & Blended Cement shipments by US region in 2019 and 2020. Source: United States Geological Survey (USGS).

Graph 1: Portland & Blended Cement shipments by US region in 2019 and 2020. Source: United States Geological Survey (USGS).

We’ll now take a general look at the US cement industry so far in 2020 to compliment Sullivan’s economic overview. Up until 2020 cement consumption, production and imports had been growing steadily since the financial crash in 2008. Using August 2020 data the PCA says this is changing. Graph 1 above shows a general reverse of the position in the autumn of 2019 [LINK] with declines in the South and North-East and growth in the West and Midwest. Imports alongside this have continued to build. Overall, national cement shipments increased by 2.2% year-on-year to just under 50Mt in January to July 2020 from 48.9Mt in the same period in 2019. This was driven by growth of 10.8% in the Midwest. Missouri is the standout in the region, behind only Texas and California nationally as the third biggest cement shipping state so far in 2020.
From the corporate side, LafargeHolcim, the US’ biggest cement producer, described North America as having, “…the most resilience of all regions despite Covid-19 restrictions in some areas.” It reported an overall fall in cement volumes of 1.4% year-on-year to 8.9Mt in the first half of 2020. However, it didn’t go into specifics for the US. Cemex’s experience seemed to be doing better with an 8% rise in cement volumes supported by the infrastructure and residential sectors. HeidelbergCement went further and described the impact of coronavirus on the US economy as ‘significant.’ It reported a decrease in cement deliveries at its North American plants of 4.9%, to 7.1Mt. Both Buzzi Unicem and CRH reported cement sales growth of 4 – 5%, with CRH noting that, “strong volume trends in West supported by growth in our downstream businesses drove performance.”

Perusing the industry news reveals a slew of environmental stories. So far in 2020, Holcim US said it was going to run a carbon capture and storage (CCS) study at its Portland cement plant in Colorado, Alamo Cement signed a deal to build a solar farm, Grupo Cementos de Chihuahua’s (GCC) Rapid City plant in South Dakota announced plans for a wind farm, CalPortland launched a sustainable product line with a lower clinker factor, LafargeHolcim launched its ECOPact low-carbon concrete range, LafargeHolcim US also said it was adopting new environmental product declarations and Holcim US opened a solar power plant at its Hagerstown cement plant. There have been a few upgrade stories, like the new line being built at National Cement’s Ragland plant in Alabama or Lhoist’s new lime kiln projects, but Lehigh Hanson said it was suspending work on the upgrade to its Mitchell plant in Indiana in April 2020.

At this point all eyes are on the US Presidential election scheduled to run on 3 November 2020. Donald Trump’s long promised but never delivered infrastructure still hasn’t arrived although blame could be apportioned to both sides of the local political divide for this. The PCA believes that both presidential candidates will probably see it through although the Republicans’ interpretation might well involve more cement! In the interest of balance though, it also expects the Democrats to focus on low-income housing construction. At this stage it seems more likely that the early arrival of a coronavirus vaccine will have more impact on the cement industry in the short to medium term than the results of the election.

View Ed Sullivan’s presentation at Global Cement Live

Published in Analysis
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Jayesh Doshi resigns as chief financial officer of Dalmia Bharat

21 October 2020

India: Dalmia Bharat’s chief financial officer Jayesh Doshi has submitted his resignation to the board of the company. Hi departure will become effective after 31 October 2020.

Published in People
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UltraTech Cement’s sales and profit grow as operations resume post-lockdown

21 October 2020

India: UltraTech Cement’s consolidated net sales grew by 8% year-on-year to US$1.39bn in the second quarter of its financial year to 30 September 2020 from US$1.29bn in the same period in 2019. Its profit after tax more than doubled to US$167m from US$78.5m. The group attributed its progress to, “strong quarterly performance on the back of operational efficiencies and its ability to serve all India markets.”

It added that it had focused on health and safety and ‘efficient working conditions’ as it had gradually resumed operations following coronavirus-related lockdown restrictions. Overall, the group’s revenue from operations fell by 14% year-on-year to US$2.44bn in the first half of its financial year from US$2.85bn in the same period in 2019.

Published in Global Cement News
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Robecco acquires inerting business from Yara

21 October 2020

Germany: Robecco says that it took over the inerting business from Yara on 1 September 2020. The acquisition is intended to support customers and their future needs. The company says that combination of Yara’s inerting systems and robecco’s monitoring and control technology is a ‘unique tailor-made solution’ to maximise safety in preventive explosion protection.

With over 25 years’ experience, Robecco has become a specialist in preventive explosion protection and can provide complete packages of equipment for monitoring, control and CO2 / N2 inerting systems from a single source and one interface according to the relevant international and European norms and rules. The company holds long-established business relationships with customers worldwide providing preventive explosion protection solutions and automation services for the integration of explosion protection solutions into customers’ systems.

Published in Global Cement News
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Samrat Cement and Dang Cement receive approval for new cement plant investments

21 October 2020

Nepal: The Investment Board Nepal has granted approval to Samrat Cement and Dang Cement for cement production at their upcoming integrated cement plants. New Business Age has reported that Samrat Cement will begin production at its 1.3Mt/yr cement plant in Dang Region in December 2020, and plans to increase the plant’s capacity to 1.6Mt/yr after a total investment of US$132m. Dang Cement’s 2.0Mt/yr cement plant, also in Dang region, is due for commissioning in late 2023 at a total investment cost of US$277m.

Samrat Cement Chair Mukunda Timilsina said, “We have brought modern machineries with German technology and skilled manpower is coming from India for this purpose.” He added that the plant will directly employ 500 local people and supply cement throughout western Nepal.

Published in Global Cement News
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Dewan Cement and Lucky Cement called before environmental hearings

21 October 2020

Pakistan: The Sindh Environmental Protection Agency (SEPA) has arranged hearings on 21 October 2020 over alleged environmental protection regulation violations by Dewan Cement and Lucky Cement at their respective Kamilpur and Karachi cement plants in the province. The provincial agency, “has expedited its monitoring activities throughout the province to manage different types of pollution at their source.”

Published in Global Cement News
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Kilns break down at Akhangarancement and Almalyk Mining and Metallurgical Combine cement plants

21 October 2020

Uzbekistan: Cement sales volumes has decreased by 29% to 5000t/day from 7000t/day at the Akhangarancement cement plant in Toshkent and by 55% to 5000t/day from 11,000t/day at the Almalyk Mining and Metallurgical Combine cement plant in Jizzakh. Uzbekistan Newsline has reported the cause of the decline as the breakdown of two kilns at the plants. This has led to a decrease in domestic cement production to 37,000t/day and sales to 35,000t/day, resulting in a slight price increase. Prices had previously been falling due to the effects of the post-coronavirus lockdown economic recovery.

Published in Global Cement News
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Mexican cement sales fall by 2% in first half of 2020

21 October 2020

Mexico: Jaime Rocha Font, the president of the National Cement Chamber (CANACEM), says that cement sales fell by 2% year-on-year in the first half of 2020 due to low demand from construction companies and the private sector. He added that sales fell by 6.3% year-on-year in the second quarter of 2020, according the El Financiero newspaper. Annual sales were 43Mt in 2018 and 40Mt in 2019.

Published in Global Cement News
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Lafarge Canada, Geocycle Canada and Rio Tinto join forces for aluminium recycling project

21 October 2020

Canada: Lafarge Canada, Geocycle Canada and Rio Tinto are working together to reuse waste from the aluminium smelting process to make cement. The three companies have developed a new product called Alextra, made from used potlining, as part of the aluminium electrolysis process that would otherwise go to landfill. Lafarge Canada plans to produce on average 1Mt/yr of cement at its plant in Bath, Ontario, using Alextra as an alternative to raw materials such as alumina and silica. The companies will also explore options to further expand the supply of Alextra from Rio Tinto’s Potlining Treatment Plant in Saguenay-Lac-St Jean to Lafarge Canada's network of cement plants.

"This partnership shows how Rio Tinto is innovating to find new ways to reuse waste, generating value from our operations and reducing their environmental footprint,” said Rio Tinto Aluminium manager valorisation and marketing Stéphane Poirier. “We have worked closely with Lafarge Canada and Geocycle Canada over the past two years to develop a product that meets their needs and look forward to building on this partnership,”

Published in Global Cement News
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Tanzanian government working on connecting gas to cement plants

21 October 2020

Tanzania: The Ministry of Industry and Trade said it is working to connect natural gas supplies to the local cement industry to help reduce operation costs and ultimately reduce the cost of cement to consumers. "The government is looking for the best way to ensure that gas is easily available, especially for existing (cement) industries in the Coastal Zone," said Minister for Industry and Trade Innocent Bashungwa.

The minister has also held a joint meeting with Minister of State in the Prime Minister's Office (Investment) Angellah Kairuki and nine cement manufacturers, according to the Tanzania Daily News newspaper. The meeting covered issues such as poor roads, energy supplies and taxation.

In 2018 the government set cement prices both locally and for import.

Published in Global Cement News
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