Displaying items by tag: data
US cement shipments fall in first nine months of 2023
21 December 2023US: Shipments of cement, including imports, in the US and Puerto Rico fell by 2.5% year-on-year to 80.7Mt in the first nine months of 2023 from 82.8Mt in the same period in 2022, according to data from the United States Geological Survey (USGS). Shipments fell in most states with the exception of Texas and Pennsylvania. The USGS estimated that, in September 2023, 98% of all blended cement shipments were of Portland Limestone Cement. Turkey was the biggest exporter of cement to the country during the reporting period at 6.3Mt followed by Canada, Vietnam, Greece and Mexico.
Update on cement at COP28
06 December 2023The Global Cement & Concrete Association (GCCA) has been cheerleading at the 2023 United Nations Climate Change Conference (COP28) in Dubai this week with the release of a progress report on the sector’s work towards reaching net zero by 2050. The headline figures are that net CO2 emissions per tonne of cementitious material fell by 23% in 2021 compared to 1990 based on Getting the Numbers Right (GNR) data. Energy efficiency improved by 19% and the fossil fuel component used by the cement sector has fallen to 80% from 98% in 1990. The GCCA has described 2020 - 2030 as the “decade to make it happen” and has set some targets to back this up. Its members intend to reduce CO2 emissions per tonne of cement by 20% by 2030 compared to 2020 levels and concrete CO2 emissions per m3 by 25% over the same time-frame.
The new developments for the cement sector at COP28 so far have been the launch of separate but apparently similar initiatives to help decarbonisation through coordination between nations. The Cement Breakthrough Agenda, backed by the government of Canada and other partners, follows the creation of the Breakthrough Agenda at the 2021 United Nations Climate Change Conference (COP26) whereby designated governments lead so-called ‘Priority Actions’ to decarbonise various sectors. The idea is to collaborate on measures such as policies, regulations and technologies to help reduce the cost of future investment in decarbonisation. The priority actions will be developed in 2023, worked towards in 2024 and then revised on a regular basis thereafter. The German Chancellor Olaf Scholz also launched the so-called ‘Climate Club’ on 1 December 2023 to help developing nations invest in technologies to decarbonise sectors such as cement and steel production. The intention is to set up the technical groundwork for a standardised calculation of CO2 intensity in selected products, such as cement and steel, set definitions on what net zero is for these sectors and then set up a platform to connect countries with funding and technical support from governments and the private sector. Neither the Cement Breakthrough Agenda nor the Climate Club has mentioned funding though.
Additionally, Holcim announced that it had become a founding member of the Sustainable Markets Initiative’s SMI Circularity Task Force. The group aims to promote the circular economy to the private and public sector. Holcim was keen to point out that it is already recycling nearly 7Mt/yr of construction and demolition waste, with a target of 10Mt/yr pencilled in by 2025.
Other groups are not as upbeat as the GCCA though. The Global Carbon Project, for example, has estimated in its annual Global Carbon Budget that global fossil CO2 emissions are set to rise by 1.4% year-on-year to 36.8Bnt in 2023. This figure includes both the CO2 released by cement production and the CO2 uptake from cement carbonation. Ongoing research by Robbie Andrew, a greenhouse gas emissions scientist at the CICERO Center for Climate Research in Norway and the Global Carbon Project, found that process emissions by the cement sector fell for the first time since 2015 in 2022, to reach 1.61Bnt. This decrease was most likely due to China’s falling cement production in 2022, stemming from a downturn in the local real estate sector. However, both the data from GCCA and the Global Carbon Project may be right simultaneously as they look at the emissions of the cement sector in different ways.
The GCCA’s job is to advocate for the cement and concrete sector and it is presenting itself well at COP28. Since its formation, it has set up roadmaps, encouraged collaboration and innovation, and is now reporting back on its progress. Net zero remains the goal by 2050, but the GCCA is being upfront about the role carbon capture, utilisation and storage (CCUS) is expected to play after 2030 and the lack of any full-scale CCUS units so far. Yet it is tracking what has happened so far through the Green Cement Technology Tracker in conjunction with Leadership Group for Industry Transition (LeadIT).
As for the rest of COP28, various reports have been aired in the international press about whether the conference will call for a formal phase out of fossil fuels in some form or another. Whether it actually happens is another matter entirely, especially considering that the president of COP28 is the chief executive officer of the Abu Dhabi National Oil Company, and any eventual language would likely be vague. Yet the work by the GGCA and others has started to make the unthinkable a little more thinkable.
Global Cement and Concrete Association publishes Cement Industry Net Progress Report 2023
04 December 2023World: The Global Cement and Concrete Association (GCCA) has published its Cement Industry Net Progress Report 2023. The report highlights the work of the GCCA and its members to lower their CO₂ emissions since signing the 2050 Net Zero Roadmap in October 2021. Initiatives include carbon capture and storage, renewables and alternative materials. These strategies have contributed to a 23% decline in cement and concrete’s CO2 emissions between 1990 and 2023.
GCCA president and Cemex chief executive officer Fernando González said “We are pleased to present this report, which captures the progress our industry is making towards net zero. But it will take the combined efforts of industry, governments and societies around the world to deliver on this commitment.” He added “This is the decade to deliver, and my number one priority is to facilitate the GCCA roadmap levers, designed to make full decarbonisation of our industry possible.”
The Cement Industry Net Progress Report 2023 is available here on the GCCA’s website.
Brazilian cement sales to fall in 2023 before rising in 2024
30 November 2023Brazil: The Brazilian National Cement Industry Association (SNIC) has forecast a drop of 1% year-on-year in cement consumption in Brazil during 2023. This is due to a slowdown in the residential construction sector, which accounts for 70% of national demand. SNIC forecast a 2% year-on-year rise in cement demand in 2024, due to increased infrastructure activity.
Brazil produced 52Mt of cement during the first 10 months of 2023, down by 2.1%. The country produced 61Mt of cement in 2022, corresponding to a capacity utilisation rate of 65%.
Vietnamese 11-month cement production declines by 4.5% in 2023
29 November 2023Vietnam: Cement plants produced 110Mt of cement during the 11-month period up to the end of November 2023, Việt Nam News has reported. The government’s General Statistics Office recorded a 4.5% year-on-year drop in national production volumes of cement in the year to date.
Hunter becomes the hunted
22 November 2023The Hunter cement plant in Texas looks set to become one of the most expensive integrated units in the world following the announcement this week that CRH is preparing to buy it for US$2.1bn. The Ireland-headquartered company said that it has agreed to acquire the plant at New Braunfels near San Antonio from Martin Marietta Material. The deal also includes four cement terminals around and near to Houston and 20 ready-mixed concrete (RMX) plants near to San Antonio and Austin. It is expected to complete in the first half of 2024 subject to regulatory approval.
Assessing the value of this deal is tricky given the various RMX plants and terminals in strategic locations. However, solely based on integrated cement production capacity, this one works out at US$1000/t given that the Hunter plant has a production capacity of 2.1Mt/yr. The value of terminals and RMX plants in the right locations cannot be overstated, but it still appears to price the cement plant dearly. CRH bought Ash Grove in 2018 for US$350/t. Five years later and the price it is paying for cement production capacity in the US has nearly tripled.
Other more recent purchases in the US include US$395/t for UNACEM’s acquisition of the Redding cement plant in California earlier in November 2023, around US$525/t for the valuation of Argos North America’s four integrated plants in September 2023, or just over US$310/t for the proposed purchase of the Redding cement plant by CalPortland from Martin Marietta Materials in March 2022. The Argos North America valuation is another awkward one given that it is part of the proposed merger between it and Summit Materials and it also includes two grinding plants, 140 ready-mix concrete plants, and a distribution network of eight maritime ports and 10 inland terminals.
Figure 1: Map of CRH production assets in Texas. Source: CRH earnings presentation.
In a statement, CRH’s chief executive officer Albert Manifold highlighted the usual synergy benefits but he also mentioned the expected “self-supply opportunities.” He added that the company believed that there was “significant potential to unlock additional growth opportunities across an expanded footprint in this attractive growth market.” If the acquisition completes, the company will become the largest cement producer in the state, based on integrated production capacity, at around 3.2Mt/yr. Plus, as the company pointed out in its third quarter earnings update, it also operates the Foreman cement plant in Arkansas, just across the state border to the north-east. This then gives CRH and its subsidiary Ash Grove a cement plant and/or terminals in the main population areas in Texas, namely: Houston; San Antonio and Austin; and Dallas and Fort Worth.
One reason why CRH may have gone all out for a cement plant in Texas is because it is one of the few states in the US where cement shipments have actually increased so far in 2023. Data from the United States Geological Survey (USGS) shows that shipments of Portland and blended cement fell by 2% year-on-year to just under 71Mt in January to August 2023. Yet Texas comprehensively bucked this trend with shipments rising by 10% to 8.04Mt. The only other states with this kind of growth were Maine and New York. At the start of 2023 the Portland Cement Association (PCA) predicted a 3.5% decline in cement consumption in 2023 and based on the January to August 2023 data from the USGS it isn’t far off at present.
Meanwhile, selling its cement assets in Houston and San Antonio nearly brings Martin Marietta Materials’ decade-long excursion into the sector to an end. It purchased its cement plants in Texas in 2014 when it acquired Texas Industries (TXI). Plants in California were soon sold to CalPortland but Martin Marietta Materials later picked up two more cement plants in the state when it bought the US West Region of Lehigh Hanson from Heidelberg Materials in 2021. Then, once again, the plants were sold, this time to CalPortland and UNACEM, respectively. This now leaves Martin Marietta Materials with one integrated cement plant, Midlothian, and two terminals. The size of the Midlothian plant, at 2.4Mt/yr, still gives the company a decent presence in the state.
With US cement consumption expected to bounce back to growth in 2024 and the Texas market ahead of this, CRH’s decision to buy big from Martin Marietta Materials seems like a logical move given its focus on North America. The price may seem high, but the investment seems as close to a steady bet as it gets. The day after the Texas announcement CRH revealed that it was selling its lime business in Europe to SigmaRoc for US$1.1bn. The key bit though was that these assets generated earnings of around US$137m in 2022 but, by comparison, the new units in Texas are expected to earn US$170m in 2023. This suddenly makes the price agreed for Hunter seem more reasonable. Let’s check back in a couple of years to see how well CRH’s acquisition in Texas works out. In the meantime all eyes are likely to be on what Martin Marietta Materials does next with the Midlothian plant.
Uzbekistan increases nine-month production so far in 2023
31 October 2023Uzbekistan: The State Statistics Committee has reported that cement plants produced 9.2Mt of cement during the first nine months of 2023, up by 5.9% year-on-year from the corresponding period of 2022. The Uzbek Building Materials Producers’ Association says that the new 1.4Mt/yr Karakalpak cement plant will further add to full-year production volumes in 2023 when it comes online later in the year.
Spain: Cementos Molins has processed 75,000t of waste into alternative raw materials for use in its cement production since opening its Barcelona alternative raw materials plant in September 2022. The plant has a production capacity of 200,000t/yr. It produces the materials from construction and demolition waste and various industrial by-products.
Cementos Molins’ director of corporate development and sustainability, Carlos Martínez, said “Our commitment to the environment is intrinsically linked to our business model, which is based on the development of sustainable and innovative materials.” He continued “We provide a second life to industrial and construction waste that would otherwise end up in landfills, generating high-quality sustainable products from them. The plant has enabled all our cements to incorporate alternative raw materials in their production process. Furthermore, we are working to reduce the carbon footprint of all our concretes, ensuring that, in the short term, all of them include recycled aggregates in their manufacture."
Use of ground granulated blast furnace slag avoided 408Mt of CO2 emissions over 22 years in EU and UK
05 October 2023EU/UK: EUROSLAG says that the use of ground granulated blast furnace slag (GGBFS) in cement production in the EU and UK between 2000 and 2022 has generated a cumulative reduction in CO2 emissions of 408Mt. GGBFS replaced 716Mt-worth of raw materials over the period.
EUROSLAG Chair Thomas Reiche said "Resource conservation through secondary raw materials, especially in the construction sector, and lower emissions of climate-damaging CO2, are of outstanding ecological and economic importance. The use of ferrous slags makes an important contribution to this. EUROSLAG is working multilaterally to master the enormous challenges in the coming years, above all the transformation of the steel industry, through research and adjustments to national and European regulations.”
Pakistan: Cement producers increased their sales volumes by 23% year-on-year during the first quarter of the 2024 financial year, which began on 1 July 2023. They recorded despatches of 11.9Mt during the quarter, compared to 9.62Mt during the first quarter of the previous financial year. The Express Tribune newspaper has reported that exports grew by 72% year-on-year to 1.75Mt from 1.02Mt.