Displaying items by tag: UltraTech Cement

India: UltraTech Cement recorded sales of US$1.91bn during the third quarter of the 2023 Indian financial year, up by 20% year-on-year from third-quarter 2022 financial year levels. The Aditya Birla subsidiary's cement sales during the quarter grew by 13% year-on-year in volume. It recorded 24% growth in costs, to US$1.74bn, while its profit fell by 38% to US$131m.

UltraTech Cement noted growth in the cost of electricity, fuels and raw materials.

India: The Himachal Pradesh State Pollution Control Board (HPSPCB) issued a show cause notice to UltraTech Cement's Baga cement plant in Himachal Pradesh's Solan District on 18 January 2023. The Hindustan Times has reported that stack emissions monitoring at the plant recorded a breach during 2022.

UltraTech Cement now has 15 days in which to respond to the show cause notice.

Adani Cement’s dispute with truck driver unions in Himachal Pradesh is about to enter its fifth week. The standoff began on 15 December 2022 when the company closed its integrated plants at Darlaghat and Barmana in response to union freight rates. A third unit, a grinding plant at Nalagarh, reportedly continued to operate for a few days longer with raw materials supplied from neighbouring Punjab and Rajasthan, until the transport companies shut down its supply.

Adani Group took over the plants from Ambuja Cement and ACC following its acquisition of Holcim’s India-based businesses in September 2022. The new business seemed to be running smoothly as new officials were appointed and an alternative fuels subsidiary, Geoclean, was created. Then Adani Cement closed its two plants in Himachal Pradesh. In a statement the group said, “Our plants at Gagal (Barmana) and Darlaghat have been incurring losses for quite some time now with no signs of improvement due to stiff resistance from transportation unions ignoring the larger cause of employment generation and contribution to the state’s revenue.” The group added that it had requested the truckers reduce the freight rate to around US$0.07/t/km from US$0.14/t/km, with the lower rate previously recommended by a committee from the state’s transport department.

Himachal Pradesh held state elections in mid-November 2022 with the Indian National Congress (INC) party taking control of the state government from the Bharatiya Janata Party (BJP). The results of the poll were revealed about a week before the cement plants closed and the new administration has suffered a bumpy start to its tenure. At first the state government issued a show cause notice to the cement producer requesting that it explain the closures or else risk ‘appropriate administrative action.' Several rounds of talks followed to no avail. Most recently, a government subcommittee has been set up that will bring together representatives of Adani Cement and the truck unions to try and agree on new freight rates.

In production terms the closure of the Darlaghat and Barmana cement plants is a big deal in the state, given that they have a combined cement production capacity of 6Mt/yr from the region’s total integrated capacity of 10.5Mt/yr. Data is limited on the direct effects of the standoff on the cement and construction market so far. However, competitor UltraTech Cement may be benefiting as it was swiftly awarded the supply contract for government projects. Local press reports have also noted that some of the unions have been stopping cement trucks from entering the state.

What is clearer is the human side to the dispute. Around 1000 staff are employed both directly and indirectly at the Barmana plant and others have jobs at Darlaghat and Nalagarh. Adani Group has relocated at least 140 staff from both sites during the closures. In addition over 7000 drivers were supporting both plants. Even more people have jobs connected to the plants, their supply chains and markets.

The argument between Adani Cement and the truck driver unions in Himachal Pradesh needs to be resolved soon for the good of everybody. Rising fuel costs are the driver of this situation, although it would be interesting to know why the other cement producers in the state haven’t similarly reacted against high freight rates in the same way. India isn’t the only country where the cement sector has been affected by driver union activity. South Korea endured a series of driver strikes in the autumn of 2022 that disrupted the cement sector. Eventually the government enacted laws to restrict strikes that might cause disruption to key areas such as cement production. The International Monetary Fund (IMF) forecasts that global inflation rates will stabilise in 2023 after a sharp rise in 2022. Growth rates are also predicted to slow. As societies and companies adjust to this it seems likely that there will be more clashes between companies, unions and other organisations as everybody tries to absorb higher costs.

India: UltraTech Cement plans to raise funds from the sale of commercial papers over a three-month period from 6 December 2022. Reuters News has reported that the producer has already received buyers' commitments worth US$60.6m. The group will offer a yield of 6.8% on the issue.

India: UltraTech Cement says that it recently commissioned two new grinding units in Northern India. The Aditya Birla subsidiary commissioned a new 1.8Mt/yr grinding unit at its expanded Dhar integrated cement plant in Madhya Pradesh on 27 November 2022. The company also inaugurated its new 1.8Mt/yr Dhule grinding plant in Maharashtra. The projects form the first phase of 12.9Mt/yr-worth of planned expansions, announced by the company in late 2020.

UltraTech Cement's managing director Kailash Jhanwar visited the Dhar cement plant to congratulate the team there on its contribution to the expansion drive.

India: Germany-based Gebr. Pfeiffer and its subsidiary Gebr. Pfeiffer (India) say they have received a follow-up order from Ultratech Cement for additional mills for new clinker production lines at its Kotputli plant in Madhya Pradesh and its Maihar plant in Rajasthan.

At the Kotputli plant it is planning to supply a MVR 5000 R-4 type mill to grind raw material. This mill can grind approximately 740t/hr to a product fineness of 1.0 % R 212µm with a 4800kW drive. At the Maihar plant a MVR 6000 R-6 type mill will also be supplied to grind raw material. In addition, several MPS 3550 BK type mills will be provided to grind fuel. These mills can grind approximately 45t/hr of pet coke, 90t/hr of coal, or any blend of the two materials. These are equipped with a 1300kW gearbox.

The plant design and the entire customer support will be handled by Gebr. Pfeiffer (India). The core components, such as gearboxes, grinding bowls, the grinding roller suspension system and the grinding rollers, will be supplied from Europe by Gebr. Pfeiffer. The remaining components, such as the foundation parts, the housings, the classifiers and most of the plant components will be provided by Gebr. Pfeiffer (India).

India: Aditya Birla subsidiary UltraTech Cement has commissioned a new 400,000t/yr putty plant in Rajasthan. The facility will produce the company's WallCare white cement-based putty. Reuters News has reported the cost of its construction as US$22.9m.

India: A court has dismissed Shraddha Binani's petition against summons by the Ministry of Corporate Affairs' Serious Fraud Investigation Office in its investigation of alleged related party transactions by the former Binani Cement. Mint News has reported that 'huge funds' from the company's related parties entered Binani's bank account, beginning in 2010.

Under corporate insolvency resolution proceedings, Binani Cement underwent acquisition by Aditya Birla subsidiary UltraTech Cement, becoming UltraTech Nathdwara Cement, in 2018.

Readers may have noticed the 2022 United Nations Climate Change Conference (COP27) is currently taking place at Sharm El Sheikh in Egypt. Many of the cement companies, suppliers and related associations are present at the annual jamboree and getting stuck in. For example, Holcim’s chief sustainability officer Magali Anderson was scheduled on 8 November 2022 to discuss solutions to decarbonise the built environment at the event’s Building Pavilion, Cemex’s chief executive officer Fernando A González took part in the First Movers Coalition (FMC) panel, FLSmidth is down for a number of talks and both the Global Cement and Concrete Association (GCCA) and World Cement Association are busy too.

Stone cold progress, if any, from the conference is yet to emerge although there is still time given that the event runs until 18 November 2022. No doubt some sort of ‘big message’ style international commitment or plan will emerge from the haggling. However, on the cement sector side, the biggest story so far has been the FMC plan for some of its members to procure at least 10% near-zero cement and concrete for its projects by 2030. Both Holcim and Cemex were founding members of the collation of companies that intend to use their purchasing power to support sustainable technologies in hard to abate sectors. Commitments for the aviation, shipping, steel and trucking sectors were set at COP26 in Glasgow, aluminium and CO₂ removal followed in May 2022 and chemicals and concrete were scheduled for November 2022. The latter has started to happen with the formation of the FMC’s cement and concrete group. Companies involved include ETEX, General Motors, Ørsted, RMZ Corporation and Vattenfall. Of these, Sweden-based energy producer Vattenfall has publicly said it is going for the 10% near-zero cement and concrete target by 2030.

Table 1: Net CO₂ emission intensity (kgCO2/t) for cement production at selected large cement producers.

While we wait for more announcements to escape from Sharm El Sheikh it might be worth reflecting upon one of the targets some of the cement companies have set themselves for 2030. Table 1 above compares the net CO₂ emission intensity for cement production at some of the large cement producers. It doesn’t tell us much, other than that the CO₂ emission intensity for these companies was in the region of 550 - 600kgCO₂/t of cementitious material in 2021. This compares to 580kgCO₂/t in 2020 for the GCCA’s Getting the Numbers Right (GNR) data for the companies it covers. The companies featured in Table 1 are all aiming – or appear to be aiming – for 475 - 525kgCO₂/t by 2030. This may not sound like much but it has and will require hard work, innovation, investment and risk on the part of the cement producers. This is also before carbon capture, utilisation and/or storage (CCUS) units will have been built at most cement plants. Yes, until the CO₂ emission intensity goes to down to zero, if cement production volumes keep rising sufficiently then total gross CO₂ emissions from the cement industry will also increase. Yet, gross CO₂ emissions from cement production are likely to peak sometime between now and 2030 if they haven’t already.

One sobering fact to end with is that 1990 is now further in the past than 2050 is in the future. If you can remember George Bush Sr as US president or you saw the film Goodfellas at the cinema then that’s the amount of time we have left to reach net zero. The global economic shocks of the post-coronavirus period and the war in Ukraine are stressing the world’s climate targets more than ever before. Let’s see how COP27 reacts to this. So far though, serious commitments to using low-carbon cement and concrete from big companies are a useful step to entrenching these products in the market.

India: UltraTech Cement has projected six-month cement capacity growth of 8.2% to 131Mt/yr by 31 March 2023, the end of the 2023 financial year. At the end of the first half of the 2023 financial year on 30 September 2022, its capacity was 121Mt/yr. In the third quarter of the 2023 financial year, UltraTech Cement expects to commence commercial operations at its upcoming 3.5Mt/yr Pali, Rajasthan, cement plant and upgraded Dhar, Madhya Pradesh, cement plant, to which it is adding 4.2Mt/yr in new capacity. The remaining new capacity consists of smaller capital expenditure investments in various sites across India. UltraTech Cement's chief financial officer Atul Daga forecast that the producer will invest a total of US$731 - 853m in capacity expenditure throughout the 2023 financial year.

The Business Standard newspaper has reported that UltraTech Cement expects to further increase its cement production capacity by 22% over the three years up to the 2026 financial year, to reach 160Mt/yr.