Displaying items by tag: Kazakhstan

Kazakhstan: A new 0.58Mt/yr cement plant is being considered in West Kazakhstan Province. The project has an estimated investment value of US$170m, according to local government and Kazakhstan Newsline. Negotiations are underway with foreign investors. The plant has been included in plans to develop the region. It is expected to create 60 jobs.

An acquisition in Uzbekistan by Russia-based Akkerman Cement this week highlights resurgence in the local market.

The subsidiary of USM has just purchased a majority stake in Akhangarancement with the help of financing from Gazprombank. No value for the acquisition has been disclosed. However, the move follows the sale of Russia-based Eurocement to Smikom in early 2021. Then in June 2021 Eurocement sold off its majority stake in Akhangarancement to Cyprus-based Lamanka Enterprises for US$53m. Now, as part of the sale to Akkerman Cement, the start of a new 2.5Mt/yr dry process production line at Akhangarancement in 2021 has also been highlighted. As for Akkerman Cement’s interest in become a multinational cement producer, it said that, “The investment in Akhangarancement, like all USM investments in Uzbekistan, is primarily aimed at the development of this country, the small homeland of Alisher Usmanov, the main shareholder of USM.”

Aside from any potential sentimental yearnings from a billionaire, the Akhangarancement deal follows a few developments in the Uzbek market in recent months. At the start of January 2022 the state assets management agency UzAssets agreed to sell the government’s majority stake in Qizilqumcement for US$174m to United Cement Group (UCG). This was a significant move locally given the size of UCG in the Central Asian states. UCG operates two integrated plants and one grinding unit in Uzbekistan. The acquisition of Qizilqumcement’s 3.4Mt/yr plant now makes UCG the largest cement company by production capacity in the country. It has also been building a new production line, like Akhangarancement, with commissioning last reported as scheduled as sometime in 2022.

Finally, the other recent development in Uzbekistan occurred in December 2021 when China-based Anhui Conch announced that it had started building a new 2.5Mt/yr cement plant in the Akhangaran district in Tashkent. The project has a price tag of US$200m.

Graph 1: Cement production in Uzbekistan, 2016 – 2020. Source: State Committee of the Republic of Uzbekistan on Statistics.

In early 2021 the government suspended tariffs on cement imports and this was then later extended into late 2022. President Shavkat Mirziyoyev says he signed the decree to keep house prices low. Subsequently, imports grew by 26% year-on-year to 2.2Mt in the first nine months of 2021. The main importers were Kazakhstan (44%), Tajikistan (25%) and Kyrgyzstan (25%). Graph 1 above shows recent annual production trends over the last five years. So far in 2021, to September 2021, overall domestic cement production rose by 17% to 9.08Mt. In 2020 annual production was about the same as the country’s production capacity of 10.3Mt/yr.

The mixture of Russian and Chinese companies involved with the recent plant acquisitions and new projects chimes with the general position of the Uzbek economy and its geographical position between the larger economies of Russia and China. For example, January 2022 data from the Uzbek State Statistics Committee showed that bilateral trade with Russia overtook that with China in 2021 for the first time since 2014. The two countries have had similar trade turnover with Uzbekistan over this period. Since the mid-2010s the national economy has liberalised and investment by foreign companies into industries like cement reflects this. The sale of Qizilqumcement also shows the further movement of state assets into private ownership. With apparent production utilisation closing to 100% and the government encouraging imports, it’s a good time to be a cement producer in Uzbekistan. Accordingly, foreign cement companies are investing.

Kazakhstan: International Cement Group has resumed operations at its Almaty cement plant following its suspension of production due to political unrest.

The group said "To safeguard our employees and plant during the nationwide unrest, the company temporarily closed its cement plant located in the Almaty region of Kazakhstan." It added “As far as business is concerned, everything appears back to normal now, but last week we definitely did not know what was going to happen."

Kazakhstan: Steppe Cement sold US$83.4m-worth of cement in 2021, up by 16% year-on-year from its US$71.7m-worth in 2020. Its sales volumes totalled 1.69Mt for the year, up by 2.4% from 1.65Mt in 2020. It exported 202,000t of cement, down by 57% from 86,500t. The company said that production limitations prevented it from fully meeting demand, and it concentrated on local markets. Regarding its outlook in 2022, Steppe Cement said “We have a healthy cash balance and are continuing our capital expenditure (CAPEX) programme to increase the production capacity of the company by 5% by mid-2022.”

Dow Jones Newswires has reported that Kazakhstan’s 2021 full-year cement consumption was 11.6Mt, up by 23% year-on-year from 9.4Mt in 2020. A rule change to pension withdrawals permitting allocations for home improvement and construction bolstered demand growth. Exports fell by 20% to 1.6Mt from 2Mt, while imports rose by 33% to 800,000t from 600,000t.

Kazakhstan: Cyprus-based International Cement Group has announced the temporary closure of its cement plant in Almaty region. Reuters news has reported the reason for the suspension as nationwide political unrest.

Kazakhstan: Steppe Cement's revenues in the nine-month period which ended on 30 September 2021 were US$67.6m, up by 8% year-on-year from US$62.6m in the corresponding period of 2020. Sales volumes rose by 4% to 1.38Mt from 1.33Mt.

Kazakhstan Newsline has reported that projected full-year Kazakh cement demand rose by 24% in the period to 11.3Mt, of which Steppe Cement controls a 14% share. The share of imports remained level at 7%. Nine-month cement exports were 1.4Mt nationally.

Kazakhstan: Korcem, a joint venture of International Cement Korday and Nurzhan Shakirov, plans to invest US$150m in the upcoming 1.5Mt/yr Korday cement plant in Zhambyl region. The company has a mining licence for 11ha of land in Korday district. International Cement Korday, a subsidiary of Singapore-based International Cement Group, holds 88% of shares in the venture. The plant is scheduled for commissioning in mid-2023.

Chair Ma Zhaoyang said “With our accumulated capabilities and experience in the cement industry in Central Asia, as well as Nurzhan Shakirov’s extensive local expertise in Kazakhstan, we are confident that this joint venture will be another success.”

Uzbekistan: Cement production grew by 23% year-on-year to 5.8Mt in the first half of 2021. Data from the State Statistics Committee of Uzbekistan shows that production increased fastest in the second quarter. It was previously reported that the country imported 1Mt of cement in the first four months of the year. 48% came from Kazakhstan, 27% from the Kyrgyzstan, 23% from Tajikistan and 1% from both Iran and Turkmenistan.

Belarus: The Belarus Architecture and Construction Ministry recorded a 25% year-on-year increase in Belarus’ first-half cement exports in 2021. Business World Magazine News has reported that the value of cement exports in the period rose by 38%. The ministry said that challenges included the on-going coronavirus pandemic and restrictions, bad winter weather and anti-dumping measures in neighbouring Ukraine.

The state is working to enhance Belarusian cement producers’ presence across Eurasian Economic Union (EAEU) markets. This includes the establishment of a trading house with Kazakhstan to double the export of building materials to that country.

Kazakhstan: The Ministry of Industry and Infrastructural Development has lifted a ban on imports of Portland cement, alumina cement, hydraulic cement and clinker into the country. A three-month ban on such imports began in late April 2021, according to the Trend News Agency. Imported cement must conform to new quality standards introduced by the ministry’s Technical Regulation and Metrology Committee in July 2021.