Global Cement Newsletter

Issue: GCW462 / 01 July 2020

Headlines


HeidelbergCement released their sustainability report for 2019 this week. Every large cement producer publishes one but this one is worth checking out because of the company’s ambition to become CO2 neutral. Other companies are heading the same way but few of them have such developed and public plans.

Sustainability reports are often a hodgepodge of non-financial reporting bringing together environment, health and safety, community and other topics. Multinational companies cover a wide range of jurisdictions and combining reporting in these kinds of fields can be beneficial. Typically they are members of various bodies like the Global Reporting Initiative (GRI) or the Global Cement & Concrete Association (GCCA) that give various levels of conformity between reports. Yet, the wider focus of sustainability reports gives companies a chance to promote what they are doing well, away from balance sheets.

One highlight of HeidelbergCement’s report is its progress towards reducing its specific CO2 emissions per tonne of cement and its recognition by the Science Based Targets (SBT) initiative towards this goal. So far it has achieved a reduction of around 22% from 1990 levels to 599kg CO2/t (net) with a target of a 30% reduction or 520kg CO2/t by 2030. There is a lot more going on in the report but it’s led by the vision, ‘to offer CO2-neutral concrete by 2050 at the latest.’ It plans to achieve this by increasing the proportion of alternative CO2-neutral raw materials and fuels, developing lower clinker cement types and capturing and utilising CO2 emissions. A focus on concrete is worth noting given the pivot by building materials manufactures towards concrete in recent years.

Back in the present, HeidelbergCement is roughly in the middle of the pack of major European multinational cement producers with its specific CO2 emissions for cement in 2019. LafargeHolcim reported 561kg CO2/t and Cemex reported 622kg CO2/t. This is a bit of a moving target since corporate acquisitions and divestments can change both the starting point and the apparent current progress. HeidelbergCement’s acquisition of Italcementi in 2017 or CRH’s purchase of Ash Grove did exactly that. The other thing to consider is that these companies manufacture a lot of cement. The actual gross CO2 emissions from a multinational cement producer are immense. LafargeHolcim, one of the world’s largest multinational producers, emitted 113Mt of CO2 in 2019 from process and fuel sources whilst making cement. To put that into context, estimates for total global CO2 emissions range from 33 – 36Gt for 2019. The cement industry’s entire share was estimated by the International Energy Agency (IEA) to be 4.1Gt in 2018.

Where this sustainability report starts to become really interesting is where it talks about CO2 capture and utilisation. Its plans in this department are more mature than many of its competitors with various initiatives at different levels of development, mostly in Europe. Norcem, its Norwegian subsidiary, recently signed an agreement with Aker Solutions to order a CO2 capture, liquification and intermediate storage plant at its integrated Brevik cement plant. The deal is dependent on government support but it’s a serious proposal. As reported previously from the Innovation in Industrial Carbon Capture Conference 2020, HeidelbergCement is actively preparing to hook up with CO2 transport and storage infrastructure. The driver is CO2 pricing from initiatives like the European Union (EU) Emissions Trading Scheme (ETS). With the EU preparing for the next phase of the ETS and talk of the European Green Deal gathering pace, before the coronavirus outbreak at least, CO2 prices in Europe look set to rise. HeidelbergCement is positioning itself to benefit from being the first major cement producer to head into CO2 capture and storage/utilisation with a variety of methods intended for different CO2 prices and regional requirements.

HeidelbergCement doesn’t mention the coronavirus pandemic in its latest sustainability report. The report covers 2019 after all, before all of this happened. These reports do include health and safety information of employees, so this may be something to look out for next year. However, Cemex did mention the coronavirus in relation to its climate action plans this week. Essentially it wants to maintain its plans as a ‘fundamental component’ of its efforts to recover from the health crisis. This chimes with media talk around so-called ‘green-led’ government-backed relief programmes. Governments are the ones who are likely to be handing out the money, probably in the form of infrastructure projects. So it’s the perfect opportunity for them to encourage change from the companies bidding for this funding. Sustainability reports and the information behind them will be a useful tool in accessing this cash.


Czech Republic: LafargeHolcim has appointed Berthold Kren as the manager of its Central Europe region. He succeeds José Antonio Prima Fernandez.

Kren joined LafargeHolcim in 2005, managing alternative fuel projects, and later became a procurement manager in Austria in 2008. He became a sourcing director for fuels in 2010 and managed the company’s energy portfolio for gas, power, solid and liquid fuels in Europe, Middle East and Africa in 2016. In 2017 he took over Geocycle's activities in India and Asia. He is a graduate of the University of Leoben in Austria, where he obtained a master's degree in engineering and environmental management.


Oman: Raysut Cement has appointed Jitender Singhvi as its chief financial officer (CFO). He was previously the head of the company’s Internal Audit unit. Singhvi holds over 20 years of experience in audit, assurance and advisory functions.


Pakistan: Power Cement says it has started commercial operation of its new 7700t/day clinker production line at its Nooriabad plant. It completed the procurement and installation of machinery for the new line in mid-2019. It was supplied by Denmark’s FLSmdith.


Bangladesh: Bangladesh Chemical Industries Corporation (BCIC) and Saudi Arabian-based Engineering Dimension International Investment (EDII) have formed a joint-venture called Saudi Bangla Integrated Cement in order to build a new integrated cement plant. The proposed unit will have a clinker production capacity of 12,000t/day, according to the Dhaka Tribune newspaper. It will be supplied with limestone from Meghalaya in India via a long conveyor belt. If realised the project is expected to create up to 700 direct and indirect jobs. Government-owned BCIC previously signed a partnership agreement with EDII in late 2018.


Nepal: The Nepal Bureau of Standards and Metrology (NBSM) has revoked the licences of two cement producers. It reported that International Cement and Reliance Supertek Cement had both sold cement below domestic commercial standards and continued to trade after receiving an order to halt sales. NBSM’s Bishwo Babu Pudasaini said, “We have intensified checks and collected samples from about a dozen cement plants for laboratory tests. These dangerous products undercut Nepal’s transition to cement self-reliance.”


India: JSW Cement has undertaken work to improve a dried-up canal in order make it a source of water for the irrigation needs of farmers in Bilakalaguduru village, Andhra Pradesh. The Hindu newspaper has reported that the JSW Cement team has redirected overflow water from a limestone quarry. JSW Cement also built a new temple to the gods Balaji and Varahaswamy in Nandyal, Andhra Pradesh using local black limestone.


Malaysia: Cahya Mata Sarawak (CMS) has reported a first quarter profit of US$4.04m, down by 64% year-on-year from US$11.4m in 2019. Sales fell by 32% to US$65.9m from US$97.6m. The company said, “Ordinarily, there is a lower level of activity in the first quarter;” however it predicted a 50% year-on-year profit drop for its cement division in the first half of 2020. It said that it expects its construction materials and trading division’s performance to “pick up and remain strong” in the second half of 2020.


Argentina: Producers sold 649,000t of cement in May 2020, down by 33% year-on-year from 965,000t in May 2019. Data from the Asociación de Fabricantes de Cemento Portland (AFCP) shows that the sharpest decline, of 80%, was in Buenos Aires. Total sales nonetheless grew by 61% month-on-month from 404,000t in April 2020. Five-month sales to 31 May 2020 fell by 35% year-on-year.


Uzbekistan: China-based Huaxin Cement has successfully ignited the kiln at its 2Mt/yr Jizzakh cement plant in Jizzakh Oblast. 200 employees attended the plant’ opening ceremony, which was streamed by video link to Huaxin Cement’s global headquarters in Wuhan Province. Huaxin Cement president Li Yeqing said, “Everyone has done a very good job, demonstrating the company's strength and personnel capabilities.” Trial operation had been due to begin in April 2020, but was delayed due to the coronavirus outbreak.


India: Mahendra Singhi, the president of the Cement Manufacturers Association (CMA), says that the cement sector can grow its exports with support from the government. He made his comments at the 16th Green Cementech 2020, a virtual conference organised by the CMA and the Confederation of Indian Industry (CII), according to the Hindu newspaper. Singhi said, “The cement industry in India is already aligned with the new vision of self reliance (atmanirbharta) of Prime Minister Narendra Modi. With the right policies in place and support from the government, the Indian cement industry can even increase its production capacity and contribute significantly to India’s global trade and exports.”


Mexico: Cemex says that the ongoing coronavirus pandemic will not delay its ‘Climate Action Strategy’ that was previously announced in February 2020. The building materials producer has developed a CO2 reduction roadmap to help guide it towards a towards a targeted 35% reduction in net specific CO2 emissions between 1990 and 2030.

The roadmap consists of: reduction of CO2 emissions of clinker through “the production of novel clinkers with lower heat consumption”; use of “alternative decarbonated raw materials”; increased alternative fuel substitution; and increased substitution of clinker with “alternative cementitious materials, using admixtures to enhance strength, and adopting new grinding technologies to improve performance”; in addition to the increased use of renewable energy.

Cemex chief executive officer (CEO) Fernando Gonzalez said, “Climate change is one of the biggest challenges of our time, and we believe that we can continue to address it as a fundamental component of our efforts to recover from the Covid-19 pandemic.”


Germany: HeidelbergCement has published its sustainability report for 2019. The building materials producer says it decreased its specific gross CO2 emissions per tonne of cement by 0.9% year-on-year to 622kg/t in 2019 from 628kg/t in 2018. Absolute net CO2 emissions also fell, by 4.6% to 68.4Mt from 71.7Mt. Indirect CO2 emission grew by 4.8% to 4.4Mt from 4.2Mt, though energy consumption in cement production fell by 3.5% to 364,000TJ from 377,000TJ.

HeidelbergCement chair Dominic von Achten said, “We have declared our express commitment to the United Nations (UN) Sustainable Development Goals. In particular, we will continue to intensify our commitment to tackling climate change in the coming years.”


UK: The Global Cement and Concrete Research Network (Innovandi) has launched a week of online workshops dedicated to lowering cement and concrete’s carbon footprint through research and development, with the participation of 30 companies and 40 scientific institutions.

Global Cement and Concrete Association cement director Claude Loréa said, “Cement is fundamentally important to our world today and will play a crucial role in building the sustainable world of tomorrow. It is therefore critical to support and accelerate the breakthrough processes and products that will improve sustainability and decrease carbon emissions. The Innovandi Kick-off Week offers a platform for leaders from across the world of cement and concrete to collaborate with academic institutions and define the cutting-edge research that will address these challenges and help us create a better future.”


Canada/US: Lehigh Cement says that it has adopted the latest North American Product Category Rules (PCR) across its entire product range.

Lehigh Hanson Canada regional cement sales and logistics vice president Shawn McMillan said, “We have made it one of our top priorities to benchmark and lower our CO2 emissions with ambitious targets. Much like food nutrition labels highlight calorific values, our plant and product-specific environmental product declarations (EPD) communicate the environmental impact through global warming potential (GWP) for cement in a simple and easy-to-understand manner. We intend to use the added product transparency to more effectively gain adoption for our lower carbon products. We have several research projects and studies on-going to continue to optimise the carbon impacts from cement and concrete.”


US: Cemex has announced that its De Zavala and Tyler cement terminals, both in Texas, have received the Environmental Protection Agency’s (EPA) Energy Star certification for energy efficiency. The De Zavala terminal reduced its energy intensity by 53% between June 2015 and June 2020, while the Tyler terminal reduced its intensity by 39% over the same period, both exceeding their five-year targets of a 10% reduction.


France: LafargeHolcim France has said that all bagged cement will now bear a 360Score CO2 emissions reduction rating, “to allow traders, artisans and homebuilders to know the precise carbon impact of their cement.” The rating, between ’A’ and ’D,’ corresponds to the factor of CO2 compared to CEM-I Ordinary Portland Cement (OPC). ’A’ Class cement produces 75% – 100% less CO2, while ’D’ class cement produces 0% – 25% less.

LafargeHolcim France chief executive officer (CEO) François Petry said, “By applying the 360Score rating scale to our bags of cements, we are continuing to implement our Lafarge 360 approach, which consists in supporting all builders to build in a more responsible manner.”


China: Huaxin Cement has announced that it burned 2.7t of seized opiates in its fuel mix at its Diwei cement plant in Chongqing. Representatives of the Chongqing Anti-Drug Committee, Public Service Bureau, Eco-Environmental Bureau and Procuratorate were in attendance. Huaxin Cement reports that the dangerous substances have been “safely disposed of.” The producer said that this is the largest single volume of drugs to have been combusted in a cement kiln. The plant previously burnt 1.22Mt of illicit substances in 2018.


Germany: Haver & Boecker and BillerudKorsnäs have published ten Sack Packaging Norms to provide a “common language” to correct “repeated, unnecessary errors which to lead to waste and loss of product performance.” BillerudKorsnäs Technical Service Director Mikael Peterson said, “If producers and users of paper bag packaging follow the recommendations and guidelines, and implement these norms in their supply chain - efficient and effective packaging manufacturing, filling, handling, storage and transport of the finished goods will be secured. As an industry we will reduce waste significantly, making a major contribution to saving our planet.”


Colombia: Cementos Argos Colombia has reported on its situation and shared its business outlook as it returns to full operations post-coronavirus lockdown. The company says that 1700 people are currently active in operations, with 910 working from home and 660 on furlough. In May 2020 it served 5300 customers, down by 74% year-on-year from 7210 in May 2019. Cement volumes fell by 41% and concrete volumes by 43%. 44 of Cementos Argos Colombia’s 58 concrete plants were operational, and 73 of its 92 work centres.

During the lockdown period the company completed over 100 new infrastructure project supply contracts. Cementos Argos Colombia regional vice president Tomás Restrepo said, “We are confident in a positive future, in our resilience, in the ability to face challenges and that we have extraordinary talent who are aware of the importance of self-care and who work every day on good ideas to continue to be the best allies of our client.”


Tunisia: Carthage Cement has announced the successful shipment of 4100t of cement from its 2Mt/yr integrated Jebel Ressas plant in Ben Arous Governorate. The shipment was postponed from March 2020 due to the coronavirus lockdown in Italy and Tunisia and is to be the first of a number of shipments of a total of 250,000t of Ordinary Portland Cement (OPC), in accordance with Carthage Cement’s contract with a local construction firm.


Sweden: The Swedish Transport Association (ST) has arranged with Cementa for the supply of ‘climate-enhanced’ cement for the completion of an expansion of the Malmö – Lund Southern Main Line between Arlöv and Lund, including an underground section and three new stations. The company first concluded the contract with ST in 2017 and has since supplied normal Ordinary Portland Cement (OPC) to the major infrastructure project. It has now agreed with the client to switch to ‘climate-enhanced’ OPC produced at its 2.5Mt/yr integrated Slite cement plant, which burns over 60% alternative fuels in its kiln lines, for production of the remaining 65,000m3 of concrete required for the project. Cementa southern district manager Jenny Larsson said, “This project is in line with Cementa’s climate-enhanced vision for infrastructure.”


Russia: Eurocement subsidiary Belgorodsky Cement has announced the start of commercial production of a new CEM-III slag Portland cement. The company says that the cement is highly water and frost resistant and suitable for use in the construction of massive ground and underground structures. Belgorodsky Cement director general Eduard Androsov said, “We offer our customers an individual approach to solving construction problems and guarantee a stable supply of high quality products in the required volumes and within strictly defined deadlines.”


US: Bruks Siwertell has launched a new branding, including a brand new logo. Group chief executive officer (CEO) Peter Jonsson said, “Our new appearance is part of a recognition process. It shows customers that Bruks and Siwertell products are part of the same family, and enables the instant association of our equipment with the ability to add value to operations, generate profitability and offer an impressive return on investment for their owners.” He added, “We have grown our business significantly over the last few years and this is a natural stage in our transformation process: a new look to show the market that we are bigger than our individual brands.”


Vietnam: The Vietnam National Cement Corporation (VICEM) has reported that Vietnamese producers exported 13.6Mt of cement between 1 January 2020 and 31 May 2020, down by 1.4% year-on-year from 13.8Mt in the corresponding five months of 2019. Producers exported 7.07Mt of cement to China, up by 26% from 9.55Mt, 2.08Mt to the Philippines, down by 29% from 2.93Mt, and 1.36Mt to Bangladesh, down by 9.9% from 1.51Mt. The total value of exported cement fell by 14% to US$505m from US$590m.


India: The India Cements recorded a profit of US$4.70m in the fiscal year ending 31 March 2020, down by 49% year-on-year from US$9.18m in the 2019 fiscal year. Sales fell by 10% to US$669m from US$744m. The company attributed the fall in revenue partly to the suspension of operations in the fourth quarter following the beginning of the nationwide coronavirus lockdown in late March 2020.


India: The Great Places to Work Institute (GPWI) has awarded the title of ‘Best Place to Work’ in the cement and building materials sectors to Shree Cement. India Blooms News has reported that Shree Cement is also among the GPWI’s 100 Best Places to Work in all sectors. The certificating body reached its conclusions by collating responses from 2.1m employees of over 1000 companies in 21 different industries across India.


Indonesia: Thailand-based Siam Cement Group (SCG) and PT Marindo Inticor have announced the launch of PT Renos Marketplace Indonesia, a digital marketplace to connect Indonesian customers with SCG’s products. Online Stock Business News has reported that ownership of the company is shared 51:49 between SCG subsidiary Better Bee Marketplace Company Limited and PT Marindo Inticor. The joint venture has registered capital of US$1.26m.


Austria: Lafarge Zementwerke, OMV, Verbund and Borealis have signed a memorandum of understanding (MOU) for the joint planning and construction of a full-scale plant by 2030 to capture CO2 and process it into synthetic fuels, plastics or other chemicals. As part of the ‘Carbon2ProductAustria’ (C2PAT) project the companies intend to build the unit at the integrated Mannersdorf cement plant and capture all of the 0.7Mt/yr of CO2 emitted.

"We are committed to leading the industry in reducing carbon emissions and shifting towards low-carbon construction. We have worked consistently and successfully on the reduction of the CO2 footprint of our cement plants, products and solutions. Ultimately, CO2-neutral cement production can only be possible with the implementation of breakthrough technologies, like carbon capture, which is why we have great expectations for the C2PAT project", said Lafarge’s local chief executive officer (CEO) José Antonio Primo.

The project aims to use hydrogen produced by Verbund to allow OMV to transform the captured CO2 into a range of olefins, fuels and plastics. Borealis would then use some of these products as a feedstock to manufacture plastics. However, the companies say that, “taking the next steps towards a Zero CO2 economy will require the right financial as well as favourable regulatory framework conditions. The success of C2PAT will largely depend on whether the right financial and regulatory framework conditions are created both at the European Union and Austrian national level.”

The joint project is designed in three phases. In phase one, the partners are currently evaluating and developing a joint strategy for project development, business modelling and process engineering. Based on the results of phase one, a cluster of industrial pilot plants in the Eastern part of Austria could be technically developed and built in the mid-2020s in phase two. Phase three entails building a full scale CO2 capture and utilisation unit at a cement plant.

Lafarge Zementwerke is the Austrian subsidiary of building materials manufacturer LafargeHolcim. OMV produces and markets oil and gas, energy and other petrochemical products. Verbund is an Austrian-based electricity generator, with a focus on hydroelectric power. Borealis is a chemical company and a producer of polyolefins, base chemicals and fertilisers.