Displaying items by tag: Mexico

Mexico: Lorenzo Zambrano, CEO of Cemex died on 12 May 2014 in Madrid aged 70. There were no immediate details about the cause of death in a statement released by Cemex and there had been no reports of illness. The company added that it will continue to operate normally.

Founded by Zambrano's grandfather more than a century ago, the company started producing cement in the northern city of Monterrey, which later became one of Mexico's industrial hubs. Zambrano was born on 27 March 1944. He joined the company after graduate school in 1968, when he earned his master degree in business administration at Stanford University. By 1985 the board of directors give him full power as CEO. Then, through a series of acquisitions, Zamrano extended Cemex's reach to five continents with operations in 50 countries.

However a US$16bn acquisition of Australian building materials company Rinker in 2007 subjected Cemex to the subprime housing crisis. At the time, Zambrano put a brave face on it. "We've shown that a company that is born in a developing country can compete in the whole world and we want to keep doing it," he said. Cemex spent the following years coping with large debt obligations, struggling to make deals with lenders and trimming costs by outsourcing and restructuring jobs.

Article updated: 14 May 2014

There was a great quote on BBC News from Nigerian cement mogul Aliko Dangote to start 2014 with: "Can you imagine, can you believe, that [Nigeria] has been growing at 7%/yr with no power, with zero power? It's a joke."

In the article Dangote is describing economic growth in Nigeria and the BBC points out that 170 million people in Nigeria use the same amount of power as 1.5 million people do in the UK. The author then goes on to predict that Nigeria could grow at a rate of 10 – 12%, by just solving power infrastructure in the country.

For the start of 2014 the British state broadcaster has been running a radio series on the so-called MINT economies. The term refers to the growing economies of Mexico, Indonesia, Nigeria and Turkey and is being used as a new buzzword in the same fashion as BRIC (Brazil, Russia, India and China) to describe broadly similar growing economies outside the traditional western bloc dominated by the G7.

Comparing the cement industries in the MINT countries raises some discrepancies between the desires of Western economists and the local cement industries. Mexico has a population of 118m, a Gross Domestic Product (GDP) of US$1.85tr and a cement production capacity of 50Mt/yr. Indonesia has a population of 238m, a GDP of US$1.29tr and a cement production capacity of 47Mt/yr. Nigeria has a population of 175m, a GDP of US$479bn and a cement production capacity of 28Mt/yr. Turkey has a population of 74m, a GDP of US$1.17tr and a cement production capacity of 82Mt/yr.

Mexico and Turkey have the lower populations in the MINT group, the highest (and most similar) Gross Domestic Product (GDP) per capita at US$15,000 and are the more developed cement industries in the group with the higher cement production capacities per capita. All of the MINT countries have infrastructural issues that will require large amounts of cement in the coming years.

Highlighting Dangote's concerns we cover a cement industry news story this week from Nepal, where Dangote is considering potential locations for a cement plant. Part of the publicly reported meeting between Dangote and the Nepalese government concerned power requirements for the project. Dangote intends to generate 30MW itself and has asked Nepal to provide 30MW. From the CEO downwards the cement producer clearly understands the problems of underdeveloped infrastructure. This is not surprising given his comments above!

That MINT economies are growing powers will not surprise the cement industry. In this week's Global Cement Weekly, in addition to the Dangote story, we feature two news stories focusing on direct industry capital investment in Indonesia. Looking more widely nearly half the stories are from BRIC or MINT countries.

With this in mind Global Cement has developed its own buzzword for the cement industry in 2014: the VISA group. This group includes Vietnam, Italy, Spain and Australia, countries that have all had problems with their cement industries in 2013 such as a production overcapacity or financial losses. If readers have any nicknames of their own for groups of cement producing nations let us know at This email address is being protected from spambots. You need JavaScript enabled to view it..

News from Mexico and the US over the past week confirms the contrasting fortunes of the cement industry in the 'Old World' and the 'New World,' of Europe and North America. First, Cemex reported a significantly reduced loss of US$203m in its third quarter, compared with a loss of US$730m in 2011. However, the firm's European units again faired worse than other regions. 

The European problem is not limited to Cemex, but while much of the continent has seen a poor 2012 so far, North America appears to be in the midst of a construction renaissance. HeidelbergCement estimates US cement sales growth of 8-11% in 2012. In Mexico, a strong and growing industry, it has also been announced that the Mexican billionaire Carlos Slim had partly financed a new US$300m plant in Mexico, due to go into production early in 2013.

In light of this apparent upward trend in North America, it is surprising that France's Lafarge has agreed to sell two more of its US cement plants, this time to Eagle Materials. If the Eagle deal is approved, it will represent (along with the May 2011 sale of Lafarge's Roberta and Harleyville plants to Cementos Argos) a continued and substantial reduction in Lafarge's presence in the US. In under 18 months, Lafarge will have offloaded four plants, taking its total from 12 to eight.

Lafarge's decision to sell to Eagle seems like an attempt to meet its own debt-reduction schedule. Yet to do this it may be losing important territory in North America. This can't have been an easy decision.