Displaying items by tag: Taiwan Cement Corporation

China/Taiwan: Two cement producers from Taiwan have reacted to potential new Chinese environmental regulations. Taiwan Cement (TCC) has announced plans to invest US$23.3m on upgrading equipment for denitrogenation and desulphurisation at its Chinese plants. Asia Cement is reportedly also evaluating similar upgrades.

Industry reports suggest that the Chinese government will likely set nitrogen oxide emissions to 300mg/m3, a level below the international standard of 400mg/m3. Upgraded equipment to meet such tougher standard costs about US$3.33m per set, which may create losses for many cement producers in China.

Only four producers out of 3000 in China currently have denitrogenation and desulphurisation processing equipment, with two based in Xiangtan, Hunan Province and another two based in Chengdu, Sichuan Province. About one third of cement makers will be unable to afford the upgrades required to meet the new regulations.

A representative of TCC said that its subsidiary Taiwan Cement International Holdings has started installing new equipment in its plant in Chongqing, aiming to decrease 60% of nitrogen oxide emissions, with similar upgrades in progress at plants in Guizhou and elsewhere.

China: Following on from other Chinese cement producers, which have reported large slumps in their half year profits, Xinjiang Tianshan Cement Co Ltd, based in the Xinjiang Uyghur Autonomous Region, has announced a first half net profit of US$18.9m, a drop of '60-80%' year-on-year.

The company stated that the decline in its half-year net profit is largely due to lower cement selling prices and rising financial expenditure. Other companies have stated that rising costs have included higher fuel prices, although this was not specified by Xinjiang Tianshan.

Meanwhile China's Sichaun Province announced that its cement sector had seen a near-60% plunge in its profitability in the five months to 31 May 2012, despite an 11% improvement in revenue in the entire building materials sector in that Province.

In addition the Hong Kong-listed Taiwan Cement International Holdings Ltd., has also warned that its net profit will decline by an estimated 50% year-on-year in the first half of 2012 due to China's strict macroeconomic controls and shrinking budgets for infrastructure projects.

TCC International reported that its net profit for the first half of 2011 was US$120.23m, although the corresponding figure for the first half of 2012 is likely to have dropped to less than US$60m.

While the slumps in profit have been dramatic, producers believe that they may be short-lived. China's cement market is expected to pick up at the end of the third quarter or early in the fourth quarter of 2012 as the country relaxes its macroeconomic controls, loosens its monetary policy and will give more rapid approval to infrastructure projects.

Update - 13 July 2012: Jiangxi Wannianqing Cement Co Ltd has announced that its first half net profit will plummet by about 80% year-on-year to US$8.5-9.9m.

China: Two kilns at a plant owned by Taiwan Cement (Anshun) have entered commissioning. The plant, which is located in Chengguan Town, in the Anshun region is one of the key projects of Guizhou Province and adds to the rapidly-growing new capacity being set up in China to replace older and less efficient plants.

The 4Mt/yr project will be fitted with low-temperature combined heat and power facilities, which are expected to produce around 130 million kWh. The project is expected to generate over 800 employment opportunities and will greatly promote economic growth in the local area.

Taiwan/China: TCC International, a unit of Taiwan Cement Corporation, has announced that it has entered into a framework agreement to acquire an array of cement and clinker production lines in Chongqing, Jiangxi and Zhejiang in China for a value not exceeding USD250m.

Under the framework agreement, the group will acquire either 100% or not less than 80% of equity interests in a group of companies and assets under Chongqing Kehua Holdings (Group) Limited and Zhejiang Kehua Group Company Limited. The target companies and assets to be acquired possess a total cement grinding capacity of about 8.1Mt/yr and total clinker production capacity of around 6.3Mt/yr.

Meanwhile, another of Taiwan's leading cement producers, Asia Cement, has posted a near 60% increase in net profit for the first half of 2011 compared to 2010 on the back of robust sales in its China operations. It recorded USD204m in net profit, up by 58.8% from a year ago.

Due to production expansion and rising product prices on the mainland market Asia Cement (China), the company's mainland subsidiary, registered USD104m in net profit during the same period, up by 369% compared to the first half of 2010.

However, Asia Cement said that its Taiwan operations suffered product price declines, which resulted from the dumping of low-priced mainland cement onto the island. This was compounded by rising production costs, which included higher fuel prices. With Taiwanese cement firms filing a complaint with the local authorities against the dumping of mainland products, Asia Cement expects domestic cement prices will rise to 'a reasonable level' later in 2011.

Meanwhile, Asia Cement said demand in China is expected to keep rising as the Chinese government carries out its 12th five-year economic development plan, which focuses on infrastucture, rural area development and residential property development. As the Chinese government gears up to phase out outdated cement production facilities, Asia Cement, which largely operates new plants there, is expected to take advantage and receive more sales orders.