Displaying items by tag: India
CCI to decide on LafargeHolcim merger in February 2015
20 January 2015India: The Competition Commission of India (CCI) will soon decide on the proposed merger of Lafarge and Holcim, according to CCI chairman Ashok Chawla on 19 January 2015. "The final order on the case should be out within a month," said Chawla.
The CCI is examining the merger as it raises competition concerns. In a joint filing to CCI, Lafarge and Holcim had said that they would continue to face aggressive competition from Indian cement makers such as UltraTech, Shree Cement and Jaypee at a pan-India level.
The total installed capacity of cement in India is about 350 Mt. Domestic consumption, which stood at 242Mt in 2011 - 2012, was expected to increase to 265Mt in 2012 - 2013.
JSW to boost cement capacity to 30Mt/yr by 2025
19 January 2015India: JSW plans to expand its cement production capacity to 30Mt/yr from 5Mt/yr by setting up grinding units closer to its steel plants. As part of its diversification, it is also considering the production of aluminium, if the government allocates bauxite mines to it.
Seshagiri Rao, joint managing director of JSW Steel, said that the company's presence in the cement business is small compared with other companies with 60 – 70Mt/yr of production capacity. JSW's plan is to become a significant player in the sector, with 30Mt/yr of production capacity by 2025, he added.
For instance, a grinding unit installed closer to the Dolvi steel plant in Maharashtra State could source clinker from Gujarat State, mix it with slag available from the plant and tap the vibrant western market. "Alternatively, we could also set up grinding units closer to the cement market and take our slag there," said Rao. "We would source clinker from the closest available location so that we remain competitive."
The Tamil Nadu State Government recently notified a scheme whereby cement companies are asked to quote their factory gate price. Contractors were given the price list to source cement for their projects. JSW Cement has also placed its bids under the scheme. "I believe that other State Governments will also emulate the Tamil Nadu Government model to make cement available for their projects at a competitive price without any subsidy," said Rao.
Osvaldo Ayres Filho resigns from Shree Digvijay Cement
14 January 2015India: Osvaldo Ayres Filho has resigned as a director from Shree Digvijay Cement Company. His resignation was effective from the close of business on 13 January 2015.
Aditya Birla Group to invest US$3.19bn in Gujarat
12 January 2015India: Kumar Mangalam Birla has said that the Aditya Birla Group will invest US$3.19bn in Gujarat State to ramp up capacities across various existing facilities.
"We will be continuing to grow our businesses here," said Birla. "On the anvil are brownfield expansions at our cement plant in Sevagram, the viscose staple fibre (VSF) plants in Vilayat and Bharuch and expansions of our metal plants, among others. Our investments will be close to US$3.19bn."
He added that Gujarat is the group's preferred investment destination in India. "We're greatly impressed by the proactive approach of Government of Gujarat. I have a personal bias for the state," said Birla. He added that it was not tax sops, but delivery of high-quality infrastructure that makes it the group's preferred state.
Prism Cement plans a limestone mining project and cement plant in Kurnool, Andhra Pradesh
12 January 2015India: Prism Cement is planning a 4.4Mt/yr capacity limestone mining project at the village of Kotapadu and Kalvatala in Kurnool District, Andhra Pradesh. 6.63km2 of land has been acquired. The project will come also include a 3Mt/yr capacity clinker plant and a 48MW coal-fired power plant. The project is waiting for the new industrial policy to be established by the State Government.
Sangharsh Morcha MLA fights for cement plant to re-open
12 January 2015India: Navjawan Sangharsh Morcha MLA and former minister Bhanu Pratap Sahi have urged the Jharkhand Government to initiate steps to re-open the Japla cement plant in Palamau, which was closed several years ago. Sahi said that the Government should also take steps to re-open the Bhavnathpur power plant. He added that the Government should outline funds in the main budget in March 2015 for its development, including water availability.
Coal strike may impact industrial growth across India
08 January 2015India: A strike by coal workers' unions would impact industrial growth across the country, industry chambers said. It asked the trade unions to resolve their grievances in an amicable manner.
"The strike would impact industrial growth across India, especially in power-deficient northern and southern regions, resulting in long unplanned outages," said Assocham secretary general D S Rawat. "The strike would impact all industries based on coal, including the cement industries that are already reeling under the pressure of raw material prices."
Over 75% of India's daily coal output has been hit as the five-day strike by workers of State-run miners entered the second day on 7 January 2015, raising fears of disruption in power supplies. The industrial action is in protest of 'disinvestment and restructuring of state-run Coal India' and to press for demands, including the roll-back of what unions call 'process of denationalising of coal sector.'
Appealing to all trade unions to call off the strike, Process Harmony Development (PHD) chamber president Alok Shriram said that they should negotiate with the government to resolve their concerns and grievances in an amicable manner. The government has begun an exercise to reform India with progressive and modest policies to put it on the path of accelerated growth. Any sort of strike to oppose and obstruct the evolving policies would harm the country's economic interest, according to Shriram.
"The path of strike serves neither workers nor the policy makers. Therefore, the working class of Coal India ought to seek redressal of their grievances through negotiations," said Shriram.
Update: According to Reuters, the strike has been called off on the second day (7 January 2015) after the government agreed to re-examine the decision.
Power minister Piyush Goyal agreed to form a committee to look into any issues with a recently-passed executive order that would allow auctions of coal mines to private companies for their own use, as well as allowing commercial mining in the future.
"We have withdrawn the strike," said Jibon Roy, a senior union leader. "The minister agreed to form a committee. They will see what are the problems in the ordinance (executive order). Normal discussions on other demands will continue."
Tamil Nadu government launches 'Amma Cement'
05 January 2015India: The Tamil Nadu government has rolled out 'Amma Cement,' a scheme that will see it sell cement at a subsidised rate. According to the scheme, the government will procure 200,000t of cement from the private sector and sell it at US$3/bag in all corporation, Municipalities and other local body limits.
The initiative was launched in Tiruchirappalli on 5 January 2015 and will be expanded in phases and implemented throughout Tamil Nadu by 10 January 2015. Beneficiaries can avail a minimum of 50 bags of cement for 100ft2 and a maximum of 750 bags for 1500ft2 at US$3/bag. They have to submit the approved building plan with the local authorities to use the scheme. Further, 10 - 100 bags will be provided for house repair work. The scheme will also be available to those constructing houses under the government's solar-powered green houses scheme.
2014 in cement
17 December 2014For the last issue of Global Cement Weekly before the Christmas and New Year break we're following our tradition of reviewing some of the major industry news stories of the year. Remember this is just one view of the year's events. If you think we've missed anything important let us know via LinkedIn, Twitter or This email address is being protected from spambots. You need JavaScript enabled to view it..
Lafarge and Holcim merger
The year has been dominated by one story: the merger of the two largest European-based cement producers, Lafarge and Holcim. The implications are massive. At a stroke the new company can dispose of less profitable units, clear debts and benefit from new mega-economies of scale. As Europe emerges from the recession, LafargeHolcim will be ready. Worldwide it is a rebuff to the consolidating Chinese cement producers who are poised, if they wish, to emerge from China and dominate international markets. The process has appeared surprisingly smooth so far with considerable forward planning. This week the European Commission has approved the proposed merger.
Lafarge CEO Bruno Lafont described the deal as 'a merger of equals'. What he didn't say is that the merger will leave LafargeHolcim with no equal. However, one question remains. Once the merger is complete will the new company be profitable?
China heads abroad
State planners in Hebei Province revealed plans to move excess cement production capacity outside of China in their usual sparse style. The quiet tone of the announcement failed to match its intentions to move 30Mt of capacity abroad by 2023. It is the next step after becoming the world's biggest cement producer, capturing swathes of the equipment market and consolidating its many local producers. How Chinese cement producers will fare in the wider global market remains to be seen. Yet while its economy remains strong the gobbling up of European utilities by Chinese companies suggests that, if all else fails, money talks.
Coal for India
If you can't fire-up your kiln you can't make clinker. With Indian cement producers reporting falling profits in 2014 the squabbling over coal allocation in the country summed up some of the input cost and infrastructure problems facing the country's cement industry. The coal blocks are due to be auctioned off from January 2015. Meanwhile analysts predict that Indian cement demand is unlikely to grow until 2016.
Sub-Saharan scares and skirmishes
The creation of Lafarge Africa means that three producers are now in a skirmish in Sub-Saharan Africa: Lafarge, Dangote and PPC. All three companies are present in multiple countries and expanding fast. This week, for example, PPC announced proposed merger plans with AfriSam. Given the low cement consumption per capita in this region the benefits of getting in early are immense. Unfortunately, there are many speed bumps along this road to development. One is the on-going Ebola epidemic. Left unchecked it could cause untold economic damage.
ASEAN set to open up
The Association of Southeast Asian Nations (ASEAN) is set to drop import tariffs in 2015 as it establishes a common market. Already in preparation cement producers have started to change their strategies, thinking regionally instead of nationally. Holcim Philippines, for example, announced in February 2014 that it was considering delaying building a new plant as it analysed the situation. The region, including high-growth countries like Indonesia and Thailand, could see its cement industry go into overdrive. However, the benefits may not be uniform as countries like the Philippines may lose out.
The US, fracking and falling oil prices
Of the western economies recovering from the 2007 recession, the US cement industry has rebounded the fastest, due in part to fracking which has brought down the cost of energy. The Brent Crude price hit a low of US$60 per barrel this week and this has consequences for everybody in the cement industry as fuel procurement strategies adapt.
For starters, cement producers gain a fuel bill cut as the cost of fuels fall. Producers in Egypt who have been frenziedly converting kilns from gas to coal may suddenly find their margins improve. Low energy prices also take away financial motivation to co-process alternative fuels in cement kilns. Finally, what of the giant infrastructure projects in Organisation of the Petroleum Exporting Countries (OPEC) like Saudi Arabia? Take away the petrodollars propping up these builds and cement demand may evaporate.
For more a more detailed look at trends in the cement industry check out the Global Cement Top 100 Report.
Global Cement Weekly will return on 7 January 2015. Enjoy the festive break!
Singareni Collieries to cut supply to cement producers
17 December 2014India: Singareni Collieries Company Limited (SCCL) has decided to cut coal supplies to the cement industry as it prioritises thermal power plants in Telangana and Andhra Pradesh. Power companies in the two states use 66% of coal produced by SCCL. However, the plants have been unable to work to their full capacity in the second half of 2014 due to a shortage of coal, according to SCCL General Manager S Chandrasekhar.
The decease in coal supplies to the cement producers is expected to make prices rise. Local media reports that the coal from SCCL is more suitable for cement production than power generation as it has a high ash content of 35 – 40%. SCCL is also reported to have encountered several instances of 'misuse' of allocated coal by cement companies. 160,000t/day or 16% of the total coal production is currently allocated to the cement industry and another 6.6% is allocated to captive power plants run by cement companies.