Displaying items by tag: Hainan
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.
Half-year update on China 2019
28 August 2019The publication of CNBM’s financial results presents a good opportunity to take stock of the Chinese cement industry in the first half of 2019. Looking at the big picture first, cement sales rose by 5% year-on-year to 1.03Bnt in the first half of 2019 from 0.98Bnt in the same period in 2018. Graph 1 below shows the sales over the last five years since 2014. Generally, sales are decreasing each year but there has been some variation in the half-year periods.
Graph 1: Cement sales in China, 2014 – 2019. Source: National Bureau of Statistics of China.
As the China Cement Association (CCA) pointed out in its summary for the first half of 2019, the cement industry ‘swelled in volume and price’ as industry efficiency grew but that the growth rate dropped ‘significantly’ compared in 2018. By region, as Graph 2 shows, variation can be seen between the south-east of the country where growth was slow or even fell compared to stronger performance elsewhere. Cement production increased by above 20% in Jilin, Shanxi, Shandong, Tibet and Heilongjiang and by over 10% in Hebei, Gansu, Tianjin, and Liaoning. However, it fell in Hainan, Beijing, Qinghai, Guizhou, Guangxi, Hunan, Guangdong and Ningxia. Most of these changes were attributed to either rising or falling demand for cement, except for Jilin where reduced imports from neighbouring provinces pushed up its demand. In most of these latter regions it attribute the decline to falling demand for cement.
Graph 2: Cement production growth by province in first half of 2019. Source: China Cement Association.
Other points of note from the CCA include the surge in imports to China. Imports of cement and clinker rose by 149% year-on-year to 8.97Mt in the five months from January to May 2019. Vietnam supplied 68% of this followed by 11% from Thailand. On the production side, 10 new production lines with a total capacity of 15.5Mt/yr were commissioned in the period. These were fairly scattered across nine provinces, in Shanxi, Anhui, Hubei, Fujian, Guangxi, Hunan, Guizhou, Gansu and Yunnan respectively.
Sales and profits were supported by growing demand and prices on the corporate side. CNBM’s operating income for its cement businesses grew by 16% to US$8.14bn from US$7.04bn. Its adjusted profit increased by 40% to US$2.76bn from US$1.98bn. Anhui Conch’s sales rose by 17.9% to US$2.15bn from US$2.11bn. It blamed poorer profits in the south of the country on adverse weather leading to weakened demand.
The weaker sales in the south could be seen in China Resources Cement’s (CRC) results with its turnover down by 6% to US$2.22bn from US$2.36bn. Likewise, its earnings before interest, taxation, depreciation and amortisation (EBITDA) dropped by 8.5% to US$820m from US$896m. The majority of its cement plants are based in Guangxi, Guangdong and Fujian. Jidong Cement was also reported as having received US$30m in subsidies from the government during the first half of 2019 in relation to its ‘daily activities.’
As is usual for these kinds of roundups the dynamic in China is between government industrial policies, like peak shifting and pollution mitigation, and local demand and price trends. One of the latest spins on peak shifting, for example, is a rating system that is being considered to decide which companies should be subject to production limits and for how long. General cement sales are slowly falling each year but the rise of imports into the word’s biggest cement producing nation (!) mark an interesting trend. Also, it may not be connected, but lots of those provinces with falling demand so far in 2019 are those on the south coast facing the heavy clinker exporting nations of South-East Asia. Given the decisiveness with which the Chinese government dispensed with imports of waste materials under its National Sword initiative since 2017, those countries importing cement to China should beware. It could change very quickly. The Chinese cement market is never dull.
Chinese clinker imports rise four-fold
05 January 2018China: Clinker imports more than quadrupled to 184,600t in the first 11 months of 2017. Data published by the Chinese Cement Association suggests that rising domestic cement prices encouraged the import market, according to Caixin Media. Most of the imports were purchased from Vietnam by companies based in Hainan, Shangdong, Zhejiang and Beijing.
China: China Resources Cement has more than doubled its profit so far in 2017 by increasing its prices. Its turnover rose by 16.4% year-on-year to US$2.61bn in the first nine months of 2017 from US$2.24bn in the same period in 2016. Its profit tripled to US$337m from US$102m. At the same time its average selling price for cement rose by 21.5%.
Cement sales volumes fell by 9% to 52.2Mt from 57Mt but clinker volumes rose to 6.16Mt from 2.94Mt. By region cement sales volumes fell in most areas, with the exception of Hainan.
China cement news in brief
18 September 2013National: The Ministry of Industry and Information Technology has released a third list of 58 companies, including cement companies, which should cut their excess production capacity by the end of 2013 as a part of the country's economic restructuring drive. The ministry said that local authorities must ensure that overcapacity is eliminated, rather than transferred to other regions.
Regional: South-eastern Fujian province produced 52.1Mt of cement in the first eight months of 2013, a year-on-year increase of 13.3%, according to data released by the local statistics bureau. Jiangxi Province produced 54.8Mt of cement in the first eight months of 2013, a year-on-year increase of 21.1%.
Central Hubei province saw cement output increase by 8.3% year-on-year to 60.3Mt in the first seven months of 2013.
North-west Shaanxi province saw cement output total 53.9Mt in the first eight months of 2013, a year-on-year increase of 9.3%.
Southern Hainan province has produced 10.5Mt of cement in the first seven months of 2013, a year-on-year increase of 26.3%. South-central Hunan province produced 9.47Mt of cement in August 2013, a year-on-year decrease of 2.8%.
Corporate: Gansu Qilianshan Cement Group plans to spend US$43.4m on acquiring a 100% stake in Longnan Runji Cement to expand into the Gansu province market. Runji Cement currently operates a 2500t/day dry-process cement plant.