Displaying items by tag: costs

Europe: Cembureau has welcomed a satisfactory conclusion to talks over the new Carbon Border Adjustment Mechanism (CBAM) under the European Union (EU) Emissions Trading Scheme (ETS). Negotiators from different EU institutions agreed to a gradual CBAM implementation, which will officially commence in October 2023. Free allocations of ETS credits to the EU cement sector and other industries will phase out between 2026 and 2034. During this transition period, CBAM duties will apply to imported products in proportion to EU production not covered by free allocation.

Cembureau's chief executive Koen Coppenholle said “The agreements on CBAM and ETS are essential to create a global level playing field on CO₂ and support our sector in its transition to carbon neutrality. It is positive that the EU institutions strengthened some key aspects of CBAM. We however regret that the adopted texts do not provide a structural solution for exports. Some EU countries export up to 50% of their domestic cement production and these will be at risk should no concrete export solution be found before 2026.”

Coppenholle added “Looking ahead, we need to focus on CBAM implementation and its water-tightness, to ensure the mechanism fully equalises CO₂ costs between EU and non-EU suppliers. It is also essential that policymakers support EU industries like cement, which are confronted with unsustainably high energy costs at a time some of our trading partners are launching massive subsidy programmes. CBAM, ETS and a strong innovation fund are essential parts of the puzzle, but we look forward to European Commission proposals for a truly ambitious industrial policy, as requested by the European Council in its meeting of 15 December 2022.”

India: Adani Cement has published its plans for the closure of two integrated cement plants in Himachal Pradesh. The Hindustan Times newspaper has reported the plants as ACC's 4.4Mt/yr Gagal cement plant in Bilaspur District and Ambuja Cements' 1.6Mt/yr Darlaghat cement plant in Solan District. The management of the Gagal cement plant said that losses ensuing from high operating costs, including transport costs, are the reason behind the decision to shut down that plant. ACC employs 1000 company staff and contractors at the site, and an additional 4000 truck drivers in its cement despatch operations. 3500 truck drivers also work in delivering cement from the Darlaghat cement plant. The Gagal cement plant alone reportedly despatches 5000t/day of cement for the Himachal Pradesh, Haryana and Punjab markets.

The Bilaspur District Truck Operators' Society said "The transport sector of Bilaspur is heavily dependent upon the Gagal cement plant. It's the source of livelihood for thousands of people, including operators, drivers and conductors. This decision should be reconsidered in the interest of the people." It added "Most roadside restaurants and mechanics' shops will also lose business. We never thought that this plant could ever stop functioning. It has been part of our landscape and economy for decades now."

Europe: The European Parliament (EP) of member states and the Council of the EU have concluded a provisional deal over plans for an EU carbon border adjustment mechanism (CBAM). Under the plans, importers of a range of emissions-intensive goods, including cement, will have to pay to obtain CBAM certificates for products entering the EU. Goods produced in countries with the same CO₂ emissions reduction measures as the EU will be exempt from requiring a certificate. CNBC News has reported that the mechanism will enter force with a transition period beginning in October 2023. This is subject to ratification by the EP and member states independently.

EP member for the Netherlands Mohammed Chahim said “CBAM will be a crucial pillar of European climate policies. It is one of the only mechanisms we have to incentivise our trading partners to decarbonise their manufacturing industry.”

Vietnam: The Vietnam National Cement Association (VNCA) has spoken about the difficulties that would arise from a proposed power price rise by state-owned Electricity Vietnam (EVN). VNCA chair Nguyen Quang Cung said that cement producers foresee 'business havoc' ensuing from any further cost increase to their operations. The industry says that reduced demand has prevented them from raising cement prices amid already high costs. Coal price growth is a significant contributor, and now accounts for 60% of the industry's operating expenses.

Cung said "Many companies are suffering losses and have suspended the operations of many production lines." He continued "We understand that EVN is claiming force majeure because they face the same challenge relating to the input cost burden."

Chile: Cement shipments fell by 14% year-on-year during the first nine months of 2022, to 3.2Mt from 3.7Mt. The La Tercera newspaper has reported that a construction slowdown impacted on the cement sales of all three of Chile’s cement producers. Cbb’s despatches fell by 18%, Cementos Melón’s by 15% and Cemento Polpaico’s by 9.5%. At the same time, the producers’ expenses rose due to increased costs across transportation, raw materials, fuels, labour, administration and finance. Meanwhile, imported cement from Asia reportedly presents a cheaper alternative for customers.

Kenya: Bamburi Cement says that it expects its full-year earnings before interest, taxation, depreciation and amortisation (EBITDA) to fall by 25% or more year-on-year during 2022. The Kenyan Wall Street newspaper has reported that the producer attributed the anticipated decline to increased energy costs and reduced cement demand.

During 2021, Bamburi Cement recorded a turnover of US$338m and a profit for the period of US$11.3m.

South Korea: Cement producers say that an on-going truck drivers' strike will force them to suspend production from 5 December 2022 if it continues for another week. Yonhap English News has reported that Industry Minister Lee Chang-Yang spoke to industry representatives on a visit to Asia Cement's Jecheon cement plant in Chunbuk. The cost of missed deliveries after four full days of the strike on 28 November 2022 was US$34.6m.

UK: C-Capture won an IChemE Global Award in the Energy category for its solvent-based carbon capture system. C-Capture's model differs fundamentally from currently commercially available systems, offering a lower energy penalty than technologies including amine-based capture. It is robust in handling impurities in flue gases, including O₂, SO_x and NO_x, while offering competitive cost and safety performance.

CEO Tom White said “Being shortlisted was honour enough, but to win the global Energy award is fantastic recognition for the C-Capture team and our unique carbon capture technology. The IChemE Global Awards represent the pinnacle of excellence in chemical process engineering. This achievement is testament to our exceptional team and their commitment to accelerating the global adoption of carbon capture and storage to achieve net zero by preventing greenhouse gases from entering the atmosphere.”

Belarus: The government has extended Belarusian Cement Company's exemption from paying customs duties and value added tax (VAT) on its goods imports until 31 December 2023. PrimePress News has reported that the cement producer had previously been exempt from payments up until 30 September 2022.

France/Switzerland: Holcim plans to delist all shares from the Euronext Paris exchange. Shares in the Switzerland-based group will continue to trade on the SIX Swiss Exchange. The cement producer explained its decision in terms of its need to simplify its trading structure. It expects thereby to further reduce its administrative costs and requirements.