Displaying items by tag: Sales

Interesting news from Holcim Mexico this week with the announcement that it is planning to invest US$40m towards building a 0.7Mt/yr grinding plant in the state of Yucátan. The unit will be supplied with clinker from Holcim Mexico’s Macuspana and Orizaba integrated cement plants. This follows the news in August 2018 that Elementia’s cement company, Cementos Fortaleza, had started to build a new 0.25Mt/yr grinding plant at Merida in Yucatan. That project has a budget of US$30m.

These two projects offer a contrast to comments made by the head of Cemex Mexico, Ricardo Naya Barba, who was lamenting the state of the market to local press at the start of the month. He said that sales volumes of cement, concrete and aggregates had fallen by 12 – 15% in the first seven months of 2019. He blamed the decline partly on falling national infrastructure investment. This marked a slight improvement on Cemex’s Mexican results for the first of 2019 where sales, sales volumes and earnings were all down. At this time as well as slowing infrastructure projects the situation was also attributed to a residential sector hit by the slower-than anticipated start of the new programs.

Elementia’s Mexican cement business, Cementos Fortaleza, reported a similar picture in the second quarter of 2019. Its net sales fell by 6% year-on-year to US65.4m from US$69.7m. This was attributed to a market contraction affecting all of Elementia’s businesses in the country, as well as the redefinition of its core products for the Building Systems business unit. Earnings fell also and this was further attributed to mounting energy and freight costs. Cementos Moctezuma faced many of the same issues. Its cement sales fell by 13% to US$147m in the second quarter of 2019. It is expecting a similar picture for the remainder of the year.

Data from the National Institute of Statistics and Geography (INEGI) shows that the value of cement sales in Mexico fell by 7% year-on-year to US$1.21bn in the first quarter of 2019 from US$1.30bn in the same period in 2018. Cement sales volumes fell by 8.2% to 10.9Mt from 11.9Mt. This was the lowest figure since 2014.

The one larger Mexican cement producer that doesn’t seem to have been overly troubled so far in 2019 is Grupo Cementos de Chihuahua (GCC). Earlier in the year the company was considered to be the Mexican cement producer most at risk from potential US tariffs due to higher reliance on exports than its competitors. Yet Mexico’s National Chamber of Cement (CANACEM) publicly said that that it didn’t consider US tariffs a significant barrier to the local industry. GCC reported growing net sales and cement sales volumes in the second quarter of 2019 due to industrial warehouse construction, mining projects and middle-income housing at the northern cities.

Two new grinding plants in a particular region of Mexico don’t necessarily reflect the state of the country’s industry as a whole. Yucatan may suit the grinding model due to a lack of raw materials or strong shipping links. The region may also be defying the gloomy national state of affairs in the construction sector. Alternatively, producers may be chasing low-cost and low-risk expansion plans in a tough market. The grinding model wins out over the clinker producing one in this scenario. In the wider picture in August 2019 Cemento Cruz Azul ordered two petcoke grinding mills from Germany’s Loesche and Austria’s Unitherm Cemcon said it had been awarded the supply of an MAS DT burner to an unnamed cement plant. These suggest that, although the sector may be having a bad year so far, things are expected to get better.

Azerbaijan: Azerbaijan’s three cement works of an integrated capacity of 5Mt/yr produced 2.5Mt of cement in the nine months to 30 September 2019, down by 1.2% compared to 2.6Mt over the same term in 2018. Overall sales were low in the period, but exports picked up in the quarter to 30 September 2019, stimulating production levels of 0.9Mt, representing no change year-on-year.

Pakistan: Cement producers in Pakistan dispatched a total volume of 4.3Mt of cement in September 2019, 13% more than the 3.8Mt shifted in September 2018. Domestic consumption stood at 3.5Mt, representing a 13% increase from 3.1Mt in the same month of 2018. The country exported the remaining 0.8Mt, a 14% increase compared to the 0.7Mt exported in September 2018. The Pakistan Observer has suggested that dwindling demand and new legislation requiring sellers of goods over US$319 in value to have a Computerised National Identity Card (CNIC), something which the majority of cement producers do not hold, are placing a drag on growth.

Brazil: Paulo Camillo Penna, the president of SNIC, the Brazilian national cement industry union, has expressed caution about growing cement sales so far in 2019. Data from SNIC shows that cement sales grew by 3% year-on-year to 40.5Mt in the first nine months of 2019 from 39.4Mt in the same period in 2018. Growth was driven by central and southern regions of the country, particularly in São Paulo. Exports grew by 22% to 90,000t from 74,000t. However, Paulo Camillo said that apparent growth in 2019 was partly due to a truckers strike in May 2018 that overly depressed the year’s sales. Despite this, he added that a survey of the construction industry released by the National Confederation of Industry (CNI) was showing slow but steady improvement.

Vietnam: State-owned Vietnam Cement Industry Corporation (VICEM), the country’s leading cement producer, produced 18.74Mt of cement and 15.63Mt of clinker in the first nine months of 2019, increases of 8% and 4% year-on-year respectively, according to the Dau Tu (Investment) newspaper.

During the period, VICEM sold 21.82Mt of cement and clinker, a 3% year-on-year rise. The sum included 18.83Mt of cement, a 7% year-on-year increase. Over the same period, VICEM’s pre-tax profit rose by 35% year-on-year to US$90.52m, including US$58.16m from its cement subsidiaries, a 20% year-on-year increase.

In 2018, VICEM produced a total of 20.4Mt of clinker and 25Mt of cement. In 2019 it aims to produce and sell 31Mt of cement and clinker, including 26.8Mt of cement, a targeted increase of 10% year-on-year.

Spain: Cement consumption in Andalusia fell by 3.3% in August 2019 to 221,970t. For January – August 2019 total consumption was 1.87Mt. It is thought that this is due to reduction in the region’s construction sector and a lack of civil works.

Exports fell by 58% year-on-year, reaching 88,136t, around 124,719t less than in August 2018. The accumulated value for 2019 is currently 46% lower year-on-year, at 731,720t.

Puerto Rico: Cement sales in Puerto Rico experienced a year-on-year fall of 7.4% in September 2019, to stand at 43,500t, the eighth consecutive monthly fall. Meanwhile, overall domestic cement production rose by 1.0% in the month under review, to reach 41,000t. This is the third increase reported to be observed during the first nine months of 2019.

Brazil: Brazil’s National Syndicate of the Cement Industry (SNIC) has released August 2019 sales figures of 5.10Mt, up by 3.0% year-on-year from 4.95% in August 2019. This corresponds to an equal apparent consumption of cement in the country of 5.10Mt, up by 2.9% year-on-year from 4.96Mt in August 2018. Besides rising demand, SNIC points to non-repeating depressing factors acting on domestic cement capacity a year ago, including a lorry drivers’ strike.

Argentina: Argentina’s Association of Portland Cement Manufacturers (AFCP) has reported on a 5.0% month-on-month growth in cement volumes sold to 1.05Mt in August 2019 from 1.00Mt in July of the same year. Domestic production continues to meet the entirety of demand, which grew by 5.1% year-on-year to 1.00Mt in July 2019 from 0.95Mt in July 2018.

Dominican Republic: The national total yield of cement rose to 2.81Mt in the six months to 30 June 2019 from 2.73Mt in the same period of 2018, an increase of 2.7% year-on-year. Data from the national cement industry association Adocem shows that 0.50Mt was exported over the period, 17.8% of the Dominican Republic’s production. The remaining cement boosted domestic sales by 5.2% to 2.31Mt from 2.19Mt in the first half of 2018, corresponding to a revenue of US$223m, up by 14.6% from US$195m in the half to 30 June 2018, on the back of rising demand from construction projects.