Anyone need a spare cement plant? If so then it looks like India is the place to head to this week.

First, Italcementi denied that it was in talks with Jaiprakash Associates to buy one of their Jaypee Cement plants. Then, after much speculation, CRH announced publicly that it had entered negotiations to purchase an equity stake in Jaypee's entire cement business. In addition the Indian government has also revived a plan to sell six Cement Corporation of India (CCI) factories that have been closed for almost 10 years.

All of this raises a question: how much are Indian cement plants actually worth?

According to one source, Italcementi was thought to be offering US$100/t (installed capacity) in the bid it supposedly made but has denied making. Jaypee 'wanted' US$150/t. However analyst commentary with the CRH announcement suggested that Jaypee's asking price was too high! This is hardly surprising. Back in June 2012 when Jaiprakash announced that it was selling its plants it was reported that Holcim was offering up to US$160/t. Alongside the CCI story an analyst was quoted as putting the cost of Indian cement production capacity at US$110/t-US$120/t. Yet these plants have been shut for a decade.

Unlike in Europe, Indian cement industry profits have been rising in double digits in recent years. However, input costs like energy and transport are rising and they are starting to hit margins listed in quarterly reports. Serious additional costs have also arisen from the anti-cartel fines issued by the Competition Commission of India. Throw in questions on infrastructure raised by last week's nationwide power-cuts and Italcementi's (non)decision to stick to US$100/t seems prescient.

Unlike Italcementi however CRH has money to spend. Back in June 2012 it was reported that the company had Euro1.5bn to invest. With Euro250m gone in the first half of 2012 on so-called 'bolt-on' acquisitions that still leaves plenty in the pot to pick up the CCI plants. Now that would be a surprise.

Pakistan: Flying Cement has made changes to its board of directors, effective 6 August 2012. The new board consists of Mr Agha Hamayun Khan (Chief Executive), Mr Kamran Khan (Director and Chairman) and Mr Momin Qamar, Mr Yousaf Kamran Khan, Mr Qasim Khan, Mrs Shaista Imran, Mrs Samina Kamran and Mrs Misbah Momin as directors.

Agha Hamayun Khan replaced Kamran Khan with effect from 23 July 2012.

India: Mangalam Cement Limited has said that Mr R C Gupta, Company Secretary, Compliance Officer and Chief Financial Officer of the company resigned with effect from 8 August 2012.

The power cuts in northern and eastern India this week will have presented citizens with a situation very familiar to Indian cement producers. With over half the country reported to be without electrical power after three power grids collapsed, industrial users are likely to have been shut down as the authorities try to bring back domestic supplies.

According to figures from the National Council for Cement and Building Materials, Indian cement producers used 79kWh/t of electrical energy in 2009 as production hit 181Mt. The Cement Manufacturers' Association placed these figures at 68-93kWh/t for a modern plant and 100-120kWh/t for older ones. In June 2012 the Central Electrical Authority reported the country's entire installed electrical capacity was 205GW.

It's difficult to estimate how much damage problems in power supply may have caused the Indian cement industry over the last few decades in either reduced volumes or increased running costs. The Cement Sustainability Initiative and European Cement Research Academy broke down the share of electrical power in a dry process plant as follows: 38% for cement grinding, 24% for raw material grinding, 22% for clinker production including grinding of solid fuels, 6% for raw material homogenisation, 5% for raw material extraction and blending and 5% for conveying, packing and loading. Generally speaking, interruption of power causes production losses and low capacity utilisation, idle running of equipment during stops and restarts of the plant, thermal losses during reheating, damage to refractory and other problems such as slowing down the train network.

Subsequently there has been a drive in India towards captive power generation and waste heat recovery (WHR) mechanisms, especially as input energy costs have risen. For example it has been reported that ACC's average cost of electricity per kWh from its captive plants is US$0.067 versus US$0.087 for grid power. Companies like Shree Cement have since gone into the electricity export market with their surpluses and, as shown by SP Ganeshan at the Global CemPower Conference in June 2012, interest in WHR is booming. Currently, the Indian cement industry has about 4000MW of installed captive generation capacity, including coal-based plants, diesel generating sets and wind turbines. Through various greenfield and brownfield expansion projects it is anticipated that another 2000MW of captive capacity will be added by 2016.

One sign of how well the Indian cement industry is coping with its energy requirements is the 74% rise in fourth quarter profit reported by Shree Cement in May 2012, in part due to savings made from captive power generation. Perhaps they could advise the Indian electricity board.

India: Birla Corporation has promoted BR Nahar to the managing director of the company. The decision was made at the board of directors meeting held on 28 July 2012. Nahar, a Fellow Member of the Institute of Chartered Accountants of India, holds more than 33 years professional experience. He became Birla's executive director and chief executive officer in 2006. He has served in diverse fields at senior positions in various large corporate houses.

The news this week that Vietnam's state-owned cement producer, Vicem, has made a first half profit 75% larger than that of the first half of 2011 is a surprising statistic from a country with so much spare cement.

The country has spent most of the past decade building cement plant after cement plant. According to research conducted for the April 2012 issue of Global Cement Magazine, Vietnam now has a cement capacity of over 70Mt/yr! Vicem says that it sold 9.7Mt of cement in the first six months of 2012 and reports that this level represents 44% of its intended production for the year. This makes its 2012 cement production target somewhere in the region of 22Mt.

How much of the non-Vicem cement capacity is being utilised in Vietnam is unknown, but it is certainly too much for Vietnam's current needs. When the country's own government owned cement producer announces that it expects to have 6Mt of cement stockpiled by the end of 2012 (enough to supply the UK for the whole of 2013), it is clear that there is a serious cement surplus. Oversupply has not been met by demand, cement prices are depressed and attempts to export, to countries both near and far, are on the up.

To help curb the problem, one cement plant project has been halted in the past week. The Kinh Bac City Development Share Holding Corp (KBC) has received permission from its state to not build its planned 5Mt/yr plant.

Halting new projects is one way for the country to reduce its overcapacity, but in the short term the industry is looking at exports. While its lengthly coastline makes getting cement to ports for export fairly straightforward, Vietnam is badly located to exploit its current situation in this way. It's proximity to China, which itself is starting to face an oversupply scenario despite its efficiency gains, leaves Vietnam at a cost disadvantage.

As well as there being China on Vietnam's doorstep, many other countries in the region, (Indonesia, Malaysia, Japan, South Korea, Philippines, etc), are also self-sufficient in terms of cement and are able to export extra capacity as necessary. Additionally, East Asian countries have often seen Africa as a good export market but the recent rise of Nigeria as a major producer may reduce this opportunity.

Amid all of these numbers the Vietnam News Brief Service commented that the current oversupply in the socialist state was down to the 'unplanned' construction of cement plants over recent years.

India: Sagar Cements has appointed K Rajendra Prasad as its nominee director on the company's board. Previous to this Prasad was working as the deputy general manager (EPM) at the Andhra Pradesh Industrial Development Corporation in Hyderabad.

Shree Digvijay Cement Company, a subsidiary of Cimpor, has reported that Antonio Carlos Custodio de Morais Varela resigned as a director of the company on 17 July 2012. The move follows Custodio de Morais Varela's assignment to the executive committee of Cimpor following the takeover of the Portuguese producer by Brazil's Camargo Corrêa.

According to government advisors cement producers pay more in the UK than other nations for their electricity and it's getting worse.

A Department for Business, Innovation and Skills (BIS) report published on Friday 13 July 2012 has shown that firms in the UK will be forced to pay an extra Euro36 in green taxes on top of the market price they pay for every megawatt hour of electricity by 2020 due to climate policies. This compares with Euro22 in Germany, Euro20 in Denmark, Euro19.3 in France and Euro12.7 in China.

As the Mineral Products Association (MPA) put it, "...cement is an internationally traded commodity and, if it costs more to make it here than to import it, then we are threatening a strategic indigenous manufacturing industry for no environmental gain." Or to put it more bluntly, if the cost of importing cement from France to the UK is less than the energy saving then say 'goodbye' to the UK cement industry. The issue raises one of the core problem of any carbon tax in a global economy. If your neighbours don't have the same tax as you then they can undercut you. Similar arguments rage in Australia and the US.

The UK will be the first country with legally binding targets for greenhouse gas emissions beyond 2020, with a pledge to introduce a carbon floor price of Euro19.98/t in 2013. As Edwin Trout explained in his recent article in Global Cement Magazine on the British Cement Industry in 2011 and 2012 the government took steps to address this in November 2011 with a Euro318m package for energy-intensive industries. Unfortunately as the MPA has now pointed out, the cement industry is ineligible for the first Euro140m of this package because the EU has ruled against such support for the sector in relation to the EU Emissions Trading Scheme.

Unsurprisingly alternative fuels trials are thriving in the UK, such as that at Lafarge UK's Aberthaw plant, which celebrates 100 years of operation this weekend.

US: Texas Industries (TXI) has announced the addition of Sean Foley (54), Bernard Lanigan (64) and Tom Ryan (47) to its board of directors. The appointments of the directors is effective as of 11 July 2012. All three are from outside of the cement industry.

"We are delighted to have found directors of the quality and experience of Sean, Bernie and Tom to join TXI," said Bob Rogers, chairman of TXI's board. "Given the improvement in construction activity, the near completion of additional cement capacity, the high quality of the company's assets and the markets we participate in, this should be an exciting time for them to be a part of TXI."

The news that Brazil's competition regulator, Cade, has approved Camargo Corrêa's attempt to control Portugal's Cimpor after over two years of poker-faced mergers, acquisitions and deals, has significantly changed the cement landscape of the country. Camargo will now be allowed a controlling stake in the Portuguese producer assuming that Votorantim, Cimpor's other major shareholder, sells its Brazilian Cimpor assets to a third player. 

The deal looks likely to happen fairly quickly, with Votorantim stating that it never intended to remain as Camargo's partner in Cimpor. Lafarge appears to have first refusal as the original seller of the stake to Votorantim, but Cade may want to avoid this due to Lafarge's strong Brazilian position.

With its Cimpor interests now set to go to another producer, the regulator is clearly looking to spread the cement wealth in the country. Cade also said that Camargo must sell some assets in Brazil's heavily developed São Paulo state - presumably not to Votorantim! An asset swap will see Cimpor assets abroad transferred to Votorantim.

The Brazilian cement market has become increasingly concentrated since 1990. At that time there were 19 different producers; by 2000 there were 12. That number has since increased slightly, but Votorantim, Cimpor, Camargo Corrêa, Holcim and Lafarge still have 85% of the integrated capacity between them. Cade's attempts to moderate their influence is understandable, given that some regions are currently now supplied by Votorantim-owned production to the tune of 70%. Accusations of cartels have been rife in Brazil for many years.

Consumers, both large and small, will be hopeful that the deal will go through smoothly and that a drop in market concentration will reduce prices in the country. Even the Brazilian government is affected. It is seeking to spend hundreds of billions of dollars on road, port and home construction and for expansion of its mines, farms and factories. If prices of building materials can be reduced, it will be able to accelerate its general development and ramp up extraction and production of its valuable natural resources.

Germany: HeidelbergCement AG has announced the appointment of Prof Dr Marion Weissenberger-Eibl as a member of its supervisory board following the resignation of Dr Ing Herbet Lutkestratkotter for private reasons.

"We are pleased that, in Prof Dr Marion Weissenberger-Eibl, we have succeeded in attracting a well-respected top German engineer as a new member of our supervisory board," announced Fritz-Jurgen Heckmann, Chairman of the supervisory board of HeidelbergCement AG. "She is very well-connected in the fields of business, science, and politics. Her extensive experience and expertise in the areas of innovation research, renewable energies, demographic development, sustainability and knowledge management will be a valuable addition."