Displaying items by tag: Import

Kazakhstan: China Gezhouba Group has inaugurated a 0.9Mt/yr clinker production plant in the Kyzylorda region. Central Asia News has reported that the plant will produce nine types of cement, with oil well cement its major product. This is aimed at diminishing the Kazakh oil industry’s dependence on cement imports. China Gezhouba Group chairman Li Ming said: “the alignment of China’s Belt and Road Initiative and Kazakhstan’s Bright Path economic policy brings great prospects for the China-Kazakhstan cement production capacity.”

The new cement plant is the first in the region and will employ 260 people.

Cambodia: Thai-based Thai Boon Rong Cement is conducting pilot testing at its newly constructed 1.3Mt/yr integrated cement plant in La’ang, Kampot province, with a view to it entering production in November 2019. Asia News Network has reported that the cement plant, located in the Thai Boon Rong Special Economic Zone, will be the fourth in Kampot, bringing the province’s total production capacity to 6.4Mt/yr. Fellow producer Chip Mong Insee, whose plant in Kampot, owned jointly with Siam City Cement, produces 1.5Mt/yr of cement, released a statement expressing hope that the new plant will help to “slash imports by a great amount, which means that we can be nearly 100% self-reliant.”

Including the fifth plant in Battambang, Cambodia’s cement production capacity will stand at 8.2Mt/yr as of the November 2019 inauguration of the new plant by Prime Minister Hun Sen. The figure confronts a rapidly growing domestic demand which is 7.7Mt/yr and shows no signs of slowing. Figures from Chip Mong Insee estimate that national cement demand in 2020 may be as high as 9.0Mt/yr.

Panama: 0.87Mt of domestically produced cement was sold in Panama in the six months to 31 July 2019, corresponding to a drop in production of 12.8% compared to the same period of 2018. Figures released by the treasury office showed total cement imports at a high of 85,600t; 10% of domestic consumption.

Germany: Data from the German Cement Works Association (VDZ) shows that cement consumption rose slightly to 29Mt in 2018. Imports were 1.5Mt and exports rose by 1.5% year-on-year to 6.3Mt. The association says that this shows the industry is in a stable phase that is expected to continue in 2019 and 2020.

"There has been an upward trend in the German cement market for four years now, thanks in particular to the positive development in the apartment block sector," said VDZ president Christian Knell. He added that annual growth in consumption had slowed but that this was ‘hardly surprising’ given the ‘tight’ capacities along the construction value chain.

Ukraine: Antidumping duties on clinker and Ordinary Portland Cement (OPC) from Russia, Belarus and Moldova introduced by Ukraine in mid-2019 have benefitted local producers. Mykola Kruts, the chairman of the board of Ivano-Frankivskcement, said that his company has been operating at a 90% capacity utilisation rate, according to Interfax-Ukraine.

South Africa: South Africa imported 0.1Mt of cement in July 2019, 293% more than in July 2018. The Algeria Press Service has reported the value of July 2019’s imports as US$4.85m. This represents a decrease from the June 2019 figure of US$6.73 of 28%. Vietnam continues to be the main contributor to the June and Julyimport figures, with Pakistan notably absent in both months. In the record seven months to 31 July 2019, South Africa imported 0.6Mt of cement at a total cost of US$29.6m.

Njobo Lekula, managing director of PPC, has stated that cement prices are ‘critically’ low for domestic producers, whose 18Mt/yr capacity faces a domestic demand of 13Mt/yr. In August 2019, South Africa’s major cement producers applied to South Africa’s International Trade Administration Commission (ITAC) for a tightening of cement standards, which may take the form of a blanket tariff on imports.

The news from Mali this week is that a new cement grinding plant is in the works. Ciments et Matériaux du Mali plans to build a 0.5Mt/yr plant near Bamako. Work on the US$34m project is set to start in October 2019 although there has been no word on the equipment supplier. The project is a long-standing one from France’s Vicat.

A new plant is probably very welcome following the last six months in the local market. Prices spiked by a third in May 2019, leading local producer Diamond Cement Mali to arrange a press conference to defend itself. Director Ibrahima Dibo explained that the company had fixed its prices in conjunction with the government at its units at Astro and Dio Gare since 2012. Instead, he blamed importers and traders for the situation, as well as low import rates from Senegal and Ivory Coast. The company proposed that it tackle the situation by importing more cement from one of its plants in Takoradi in Ghana and then transporting it into Mali via Dakar in Senegal. Although it noted that it would need permission from the government to do this.

The country has also been targeted by Nigeria’s Dangote Cement for several years. Back in 2016 the Nigerian cement producer was considering building a 1.5Mt/yr grinding plant. It also wanted to build a second production line at its Pout plant near Dakar in Senegal to export clinker specifically to Mali. It has since scaled back its expansion plans as the Nigerian economy entered a recession but in its 2018 annual report it noted that it had exported 0.43Mt of cement from Senegal and that most of this had gone to Mali, with plans to further increase exports in 2019.

At present Mali has three main grinding plants. Two are run by Diamond Cement and the third by Ciments de l'Afrique (CIMAF). An integrated plant at Guinbané, Diéma in the Kayes region was announced in late 2016 when the government signed a memorandum of understanding with Gaia Equity, a private equity company. This project was going to be built by China’s Sinoma.

Figure 1: Distribution of cement prices in Africa and Location of Plants 2015. Source: World Bank / ECDPM.

The status of that last project is unknown since there has been little news on it since. However, Figure 1 above shows why a private equity firm might sense opportunity. It’s out of date as various countries have become self-sufficient and we’ve covered this plenty of times before but the graphic from the World Bank really brings home the message that moving cement overland is uneconomical. This is mirrored by the mounting price of cement in Mali earlier this year. Africa has been described as the last great cement frontier and Mali is on the frontline.

Philippines: The September 2019 customs duty of US$4.81/t on imported cement is in danger of disrupting a Philippine Competition Commission (PCC) probe. The Philippine Star has reported that the PCC is conducting an investigation into domestic cement producers’ alleged anticompetetiveness following an accusation by a Department of Trade and Industry (DTI) official in 2017 that a ‘cartel’ of producers was maintaining artificially high pricing and spreading of misinformation about the quality of imported products. PCC chair Arsenio Balisacan has noted the danger of ‘having an ongoing investigation and introducing a policy which can influence the outcome of that investigation.’

Napoleon Co, chairman of the Philippine Cement Importers Association (PCIA), has stated that cement traders will keep on importing unless the local cement sector produces more. He said that foreign producers’ Philippine sales were driven not by their lower prices but by the domestic industry’s inability to fulfill the country’s 28Mt/yr demand.

Philippines: The Department of Trade and Industry (DTI) has introduced a customs duty on imported cement of US$4.81/t. The Manila Times reports that the measure is subject to annual review and will be in place for three years, decreasing by US$0.48/yr.

The government previously imposed a provisional tariff of US$4.02/t, in spite of protests from Vietnam that any executive action would be in contravention of World Trade Organisation rules. Philippine law allows for the imposition of such measures where an appointed advisory body has determined that increased imports ‘threaten to substantially cause injury to the domestic industry.’

The advisory body in question is the Tariff Commission, who in August 2019 recommended a tariff of US$5.68/t. Secretary of Trade and Industry Ramón López stated that the figure aims to address the threat with minimal impact on buyers. Cement prices in the country hit a low in early January 2019 of US$98.6/t, rising to US$108.25/t after the imposition of the provisional tariff.

Vietnamese producers will be the hardest hit by the price hike, with 75% of the Philippines’ imported cement originating in Vietnam. Asian Review reports that a further 18% comes from neighbouring China and 8% from Thailand.

Madagascar: LafargeHolcim has lobbied for cement homologisation norms to targeting importers. Chief Executive Officer François de Lesquen said that the company does not fear competition but wants a level playing field.

LafargeHolcim owns 90% and 66% respectively of Madagascar’s Ibity and Mahajanga cement plants, representing the entirety of domestic cement production. Holcim Madagascar yesterday launched its Orimbato 42.5 cement for heavy load-bearing concretes.