Displaying items by tag: Sinoma

PPC revealed plans this week to build a new cement plant in the Western Cape region of South Africa. It has entered into a “strategic cooperation agreement” with Sinoma Overseas Development Company to put together a 1.5Mt/yr integrated plant for around US$160m. It is hoped that construction will start in the second quarter of 2025 with commissioning scheduled by the end of 2026.

CEO Matías Cardarelli described more details about the project during a tie-in webcast on 16 January 2025. Specifically, the new unit will be built at the company’s integrated Riebeeck Plant site due to the quality of the local limestone and the greater reserves. In addition, all the key environmental approvals and mining rights have already been obtained. Both this plant, and the nearby De Hoek Plant, will continue to run throughout the construction and commissioning period. A decision will then be made about required staffing. PPC did not explicitly say whether the two old plants would be closed but the new plant will “replace and increase the existing capacity” at the other sites.

Points to note from the announcement start with the low cost for the clinker production line. PPC’s 1Mt/yr line at its Slurry plant cost around US$75m when it was commissioned in 2018. Sinoma also built that one. However, negative currency exchange effects make comparisons tricky. In 2015 PPC said that the cost of the Slurry line was around US$115/t. It pointed out that the price was low as it was a brownfield investment. This compares to US$107/t for the Western Cape project, another brownfield project. Other recent integrated plant projects in Sub-Saharan Africa to consider include Cemtech’s clinker plant in Sebit, Kenya (US$170/t) or West International Holding’s forthcoming plant in Buikwe District, Uganda (US$150/t). Plans for a new PPC plant in the Western Cape go back to at least 2017 when the then CEO Johan Claassen said it was preparing for a ‘mega plant.’ At the time it was hoping to replace its Riebeeck plant with a ‘semi-brownfield’ facility that would use around 25% of the current plant’s equipment. The scheme had actually been around longer but Claassen remarked that insufficient domestic demand had held it back.

The next detail to consider is that PPC is planning to build this new plant within 100km of the coast. This was addressed directly with PPC saying that the new plant would be “extremely competitive” against imports. They say it will be able to produce cement, at least, to a similar cost to imports from Vietnam. It was also remarked that only 10 - 15% of the 1Mt/yr of imports, mainly from Vietnam, go to the Western Cape with the rest heading to KwaZulu-Natal via the Port of Durban.

PPC’s plans in Riebeeck are part of its ‘Awaken the Giant’ development strategy. For its six month financial results statement to September 2024 it said that it had “early positive and encouraging signs in all lines of our business.” In South Africa its earnings were up despite lower sales volumes. Dangote Cement’s local subsidiary, Sephaku Holdings, reported a similar picture with a small bump in revenue and earnings back up after coal and fly ash supply constraints a year earlier. PPC isn’t the only cement company developing capacity. Huaxin Cement-owned Natal Portland Cement was reportedly investing US$65m in the autumn of 2024 towards expanding its Simuma Plant in KwaZulu-Natal.

The cement sector in South Africa had a couple of ownership changes in 2024. As mentioned above, China-based Huaxin Cement bought Natal Portland Cement from InterCement at the start of the year. Then, Afrimat received approval to buy Lafarge South Africa in April 2024. Both of these incomers have clear ambitions to expand in the industry. In this context PPC’s decision to finally revive its Western Cape plans, before whatever its new competitors devise, makes sense. Expect more talk of capacity upgrades in the future.

China/Denmark: Denmark-based FLSmidth Cement has signed a licensing agreement with Sinoma International Intelligent Technology (IIT) covering the production and sale of QCX lab equipment in China. Cyril Leung, Country Head China – FLSmdith, said “The deal effectively provides us a new sales channel and represents our continued commitment to enhancing our services in the world’s largest cement market.”

All QCX equipment that FLSmidth Cement supplies outside of China will continue to be made in Brno, Czech Republic. Development and delivery of QCX software will remain in Denmark. FLSmidth noted that the agreement has no impact on the ongoing divestment of FLSmidth Cement.
FLSmidth Cement’s QCX lab equipment supports sampling, preparation and analysis. Products in the range include the QCX/RoboLab laboratory automation system, analysers, sample preparation products, quality control systems and laboratory software.

China: The sales revenue from CNBM’s cement manufacturing division fell by 31% year-on-year to US$5.70bn in the first half of 2024 from US$8.25bn in the same period in 2023. The group blamed the decline on falling sales volumes of cement and aggregates and decreasing prices of heavy building materials. Its Basic Building Materials segment reported an operating loss of US$261m from an operating profit of US$348m previously. The division sold 114Mt of cement and clinker, a fall of 20% from 142Mt.

In its interim report the group said that its Basic Building Materials segment had been “…affected by a combination of factors, such as the in-depth adjustment of the real estate and funding constraints for infrastructure projects.” Subsequently the cement industry had faced low demand and prices. It added that market overcapacity had not been resolved.

Overall the group’s revenue and gross profit fell by 19% to US$11.7bn and by 25% to US$1.86bn respectively. However, income from its Engineering Technology Services segment rose by 2% to US$2.89bn. This division includes cement plant and equipment supplier Sinoma International. The group noted that global engineering and construction demand remained stable in the first half of 2024.

Global: Titan Group and Sinoma CBMI have signed a Memorandum of Understanding (MoU) to collaborate on new business opportunities and technological innovations, focusing on decarbonising and digitising cement manufacturing.

Chair of the Titan Group executive committee, Marcel Cobuz, said "Our partnership with Sinoma will enhance our Green Growth Strategy 2026, benefiting both companies and advancing efficiencies across various fronts. Together, we are transforming the building materials sector towards a net zero future."

The MoU extends the collaboration beyond their initial joint venture on Titan's cement plant in Albania, exploring further advancements in low-carbon fuel and cooler technologies, virtual cement applications, digital logistics and carbon capture solutions.

Saudi Arabia: Sinoma CDI says that it has won a contract with Eastern Province Cement for the construction of a new 10,000t/day line at the producer’s 3.5Mt/yr Al Khursaniyah cement plant. The new line will more than double the plant’s capacity to 7.15Mt/yr and cost US$271m, according to Mist News.

Saudi Arabia: Riyadh Cement Company awarded a US$34.8m contract to China-based Sinoma Energy Conservation to install a waste heat recovery (WHR) plant at its 3.7Mt/yr Riyadh cement plant. The installation will have a power generation capacity of 12.6MW.

Dominican Republic: Domicem held a ceremony marking the lighting up of the kiln on the new second production line at its Sabana Grande de Palenque cement plant in San Cristóbal province in mid-October 2023. Company engineers, staff from China-based CBMI Construction and representatives from parent company Colacem were present for the event. The cement company signed a contract with China-based Sinoma Construction for a 3500t/day clinker production line in 2021. The project had a reported investment of US$120m. The official inauguration of the new line is scheduled to take place on 22 November 2023 and the President of the Dominican Republic is expected to attend.

Saudi Arabia: China-based Sinoma has signed a contract with Yamama Cement for the construction of a new 10,000t/day clinker production line at its new plant site. The announcement of the engineering, procurement and construction (EPC) contract at the Arab-International Cement Conference in Amman, Jordan, came shortly after the news that Sinoma had been contracted to dismantle, move and rebuild one of Yamama Cement’s existing cement production lines in a strategic move between the producer’s old and new plant sites.

France: Germany-based IKN says it successfully commissioned a new Pendulum Cooler at Lafarge France’s Martres cement plant earlier in the year. The 2500t/day cooler was supplied for the new production line at the unit. It is also equipped with a single grate Dynamic Linear Drive and a roll crusher with three rolls at the cooler end as well as a bypass. It is designed to be used with an alternative fuels thermal substitution rate of up to 85%. IKN thanked Lafarge France and China-based CBMI for their cooperation on the project. The new production line was commissioned in January 2022.

China: CNBM’s sales revenue grew by 7% year-on-year to US$43.1bn in 2021 from US$40.1bn. Its sales volumes of cement and clinker fell by 3% to 332Mt and 13% to 40.4Mt respectively. Concrete sales volumes increased slightly to 112Mm³. Its adjusted earnings before interest, taxation, depreciation and amortisation (EBITDA) rose by 7% to US$8.11bn from US$7.6bn. The group increased its average cement prices by 10% in 2021. However, the group’s sales revenue from its engineering division fell by 29% to US$421m from US$590m, although its earnings recovered significantly. The group blamed this on “great uncertainty” in overseas markets due to the coronavirus pandemic although it said that producer’s willingness to invest was starting to recover.

Zhou Yuxian, chair of CNBM, said “The year 2021 was an extraordinary and tough year. In the face of complex environment abroad and numerous risks and challenges, China adhered to the general keynote of seeking progress in a stable manner, coordinating prevention and control of the Covid-19 pandemic and the development of economy and society, continuing the national economic recovery, taking a new step in building a new development pattern and achieving a good start of the 14th Five-Year Plan.”