Global Cement Newsletter

Issue: GCW669 / 24 July 2024

Headlines


Congratulations to Taiheiyo Cement Philippines (TCPI) this week for inaugurating its new 3Mt/yr production line at its Cebu plant. The US$220m line replaces the old line at the site that was closed in late 2021.

The plant was originally built by Grand Cement Manufacturing in the early 1990s. Japan-based Taiheiyo Cement took over in 2001 and later made the decision to upgrade the site in 2017. It then contracted China-based Anhui Conch and Sinoma (Handan) Construction for the project in 2021 and groundbreaking took place in mid-2022. Commercial operation of the new line was previously scheduled from May 2024. TCPI has also invested around US$140m in related projects such as its Jetty and Marine Belt Conveyor project, which links the Cebu plant to the coast via a conveyor. Other parts of this expenditure encompass the Luzon Distribution Terminal Project at Calaca in Batangas and general port development in San Fernando.

The Department of Trade and Industry (DTI) was keen to promote this example of a foreign-owned company investing in local manufacturing. DTI Secretary Fred Pascual pointed out that Japan is the country’s “second-largest trading partner and third-largest source of foreign investment.” He also linked the project to the national Build Better More infrastructure development programme and the Tatak Pinoy Act that was introduced in early 2024 to promote local industry. Along these lines, Republic Cement was awarded the Domestic Bidder’s Certificate of Preference this week. It is the first cement company to receive it. The initiative promotes the use of local manufactured materials in government projects as part of the Tatak Pinoy Act. As one might expect, the Cement Manufacturers Association of the Philippines (CEMAP) supports the Tatak Pinoy Act. It voiced its support for the legislation in June 2024 when the DTI started to implement it. It noted that cement imports were just under 7Mt/yr in 2023 despite the anti-dumping duties imposed on a number of Vietnam-based producers and traders. This compares to a local production capacity of nearly 50Mt/yr.

CEMAP mentioned that new production lines from both TCPI and Solid Cement were expected in 2024. The latter project is a new production line being built at Solid Cement’s Antipolo plant near Manilla in Rizal province. Cemex Philippines held a groundbreaking ceremony for the 1.5Mt/yr line at its subsidiary back in 2019. However, Cemex said it was selling its Philippines-based business to DMCI Holdings and related companies in April 2024. As part of this process Cemex sold its local cement brands to the Consunji family, the owners of DMCI Holdings, in June 2024. Regulatory approval of the divestment is still pending but the sale of the brands suggest that the transaction is progressing. Completion is expected by the end of 2024. Operation of the new line at the Antipolo plant is anticipated from September 2024.

Another forthcoming plant project was announced by PHINMA Corporation in June 2024. It signed a joint venture deal with investment company Anflo Group to build a 2Mt/yr cement plant in Davao del Norte. The project is scheduled to be operational by 2026. Cement from the plant will be marketed under the Union Cement brand. The sums involved suggest a grinding plant but PHINMA’s cement division, Philcement Corporation, is involved with both manufacture and importation. PHINMA also signed a deal to buy Petra Cement in May 2024. The latter company runs a 0.5Mt/yr cement grinding plant in Zamboanga del Norte. PHINMA re-entered the cement market in the late 2010s when it bought the Union Cement brand and built a cement processing plant at Mariveles, Bataan in 2020.

The battles between cement producers and importers continue to play out in the Philippines as the country’s infrastructure plans gather pace. Yet the balance seems to be tilting more towards the favour of the local manufacturers at the moment, as new capacity gets proposed and built. Anti-dumping duties on imports, particularly those from Vietnam, have now been followed up with local procurement rules in the guise of the Tatak Pinoy Act. Whether this is enough remains to be seen. This kind of environment and the departure of Cemex may also start to revive questions about whether any other foreign-owned cement companies might be considering their options too.


Colombia: Cemex Colombia has appointed Juana María Serna as Commercial Vice President. She previously worked as the Vice President for Strategic Planning for Cemex Colombia & Peru and the VP for Builders and Urbanization Solutions for Cemex Colombia from late 2020. Earlier in her career she worked for Cemex Group in Mexico, becoming Global Customer Experience Director in 2018. She started working for Cemex in Colombia in 2007. Serna holds an undergraduate degree in Architecture and a Master of Business Administration from the Universidad de Los Andes in Bogotá.


India: Wonder Cement has appointed Sanjiv Waid as State Head. He previously worked as a Sales Marketing Manager for Ambuja Cements and has held roles with Nuvoco Vistas and ACC. He holds a bachelor’s in Industrial Chemistry from Delhi University.


India: Gebr. Pfeiffer India has appointed Sridhar Shanmugha Sundaram as Senior Vice President, Head of Sales & Marketing.

Sundaram previously worked for FLSmidth for over 30 years. He started in the early 1990s as an Engineer – Plant Engineering and later became Manager - Cement Project Sales in India in the mid-2000s. Amongst other roles he was the Head of Project Sales in India in the mid-2010s and his last position with FLSmidth was as Vice President, Head of Global Product Line - Grinding and Gears from early 2023. Sundaram holds an undergraduate degree in Engineering from the College of Engineering Guindy in Chennai and an Executive Masters of Business Administration from Copenhagen Business School in Denmark.


Gabon: President Brice Oligui Nguema of Gabon invited Aliko Dangote, President and CEO of Dangote Industries, to invest in Gabon's cement sector during a visit to the country. Discussions centred on potential cement plant investments to bolster Gabon's infrastructure development. President Nguema noted that the collabora­tion with Dangote Industries would bring significant ben­efits, including job creation, technology transfer and en­hanced industrial capacity. This potential investment aims to strengthen economic ties between Nigeria and Gabon and enhance Gabon's industrial capacity, with further discussions planned in the coming months to finalise the investment strategy.

Dangote said "We are excited about the opportunity to invest in Gabon. Our goal is to contribute to the country’s economic diversification and industrialisation efforts. By leveraging our expertise in cement production, we aim to support Gabon’s infrastructure sector."


Southern Africa: PPC has entered a strategic cooperation agreement with Sinoma Overseas Development to improve efficiency, modernise technology, cut production costs, shift to alternative fuels and expand capacity in PPC’s operations in South Africa, Zimbabwe and Botswana.


Canada: Finland-based Wärtsilä will provide a hybrid-electric propulsion system for an 11,000t-capacity limestone carrier, commissioned by CSL Group with China-based CCCC Shanghai Equipment Engineering and Jingjiang Nanyang Shipbuilding. The order supports CSL Group’s decarbonisation strategy by optimising engine and battery load and reducing fuel consumption.

The vessel is scheduled for delivery to CSL Group in 2026 and will initially operate on a hybrid diesel and battery system, transitioning to full electric power by 2031 to reduce carbon emissions by 90%, according to CSL Group. Wärtsilä will supply the whole hybrid electric propulsion system, including generators, DC hub, energy management system, main propulsion e-motors, bow thruster e-motors and battery solution.

The director of Electrical & Power Systems at Wärtsilä Marine, Torsten Büssow, said "Wärtsilä is committed to making decarbonised shipping possible, so we are delighted to be supporting CSL with solutions that enhance the sustainability of their fleet. This is a short sea shipping vessel that will operate with a lot of manoeuvring and variable load profiles, and electrification and hybridisation systems are the most efficient for such vessels."


Singapore: Malaysia-based YTL Corporation has concluded a conditional sale and purchase agreement for an 81% stake in NSL for US$169m. YTL Cement will launch a mandatory unconditional cash offer for all outstanding shares in NSL after completing the acquisition. NSL manufactures precast concrete components and operates an environmental services division.


Catalonia: Cement consumption in Catalonia decreased by 3% year-on-year to 1.1Mt in the first half of 2024. Cement production rose by 0.2% year-on-year to 3.21Mt. However, cement and clinker exports dropped by 25% to 1.5Mt.

The president of Ciment Català, Salvador Fernández Capo, said "The continued infrastructure deficit is hindering Catalonia's economic growth, affecting the well-being and quality of life of its citizens and diminishing the competitiveness of the country's economy.”


Nepal: Exports of cement and clinker reached US$48bn in the 2024 financial year, tripling the figure from 2023, according to the Department of Customs. Exports of cement were US$23.5m, while clinker exports stood at US$22.5m.

This follows the government’s introduction of an 8% cash incentive for mine-based product exports and the identification of cement as a potential export item in the Nepal Trade Integration Strategy 2023. Policy changes, including tariff waivers on significant electricity usage by manufacturers, also contributed to this growth.


Pakistan: The All-Pakistan Cement Distributors Association (APCDA) has asked the government to take heed of their strike call issued on 13 July 2024. The association is threatening action in response to new taxes and ordinances. These include a new sales tax, an increase in the 236-H income tax from 1% to 2.5% and the introduction of point-of-sale systems. APCDA said that the measures together made it ‘extremely difficult’ for cement dealers to operate. It called for exemptions or inclusion in a different presumptive tax regime in order to prevent industry collapse.

The News International newspaper has reported that association chair Chaudhry Sajid said that the new taxes will have to be passed on as additional costs for customers. He criticised the classification of cement as a fast-moving consumer good, as not all dealers are sufficiently ‘tech-savvy’ to adopt the requisite digital systems.


Australia: Calix has been awarded a US$10m grant from the Australian government’s Carbon Capture Technologies Program to build a commercial demonstration electric calciner for ‘near zero emissions’ lime and cement production. The grant covers up to 50% of the expenditure, contingent on meeting project milestones.

The project will utilise the Leilac technology to capture up to 20,000t/yr of CO₂ from the cement and lime manufacturing processes. The project will create two revenue streams via a ‘near zero emissions’ lime product, as well as up to 15,000t/yr of captured CO₂ being sold to the SM1 project for green methanol production.

In the second phase of the project, production will be expanded to include the processing of cement raw meal to a ‘near zero emissions’ clinker product, with captured CO₂ supplied for use.


India: Dalmia Bharat reported a net profit rise to US$17.3m for the first quarter of the 2025 financial year, up from US$17.2m crore in the same period in 2024. The company’s revenue from operations remained steady at US$433m. Cement sales volumes increased by 6% year-on-year to 7.4Mt, compared to 7Mt in 2023.

Managing director and CEO, Puneet Dalmia, said "During the quarter, even though cement demand was weak across regions amidst general elections, our volumes grew 6.2% year-on-year while margins improved to 18.5% from 16.9% in 2023."


Afghanistan: The Ghori Cement plant in Baghlan province plans to increase its production from 0.18Mt in 2023 to 0.2Mt in 2024 due to a growing demand for cement. Technical deputy of the factory, Sarbaz Banuzai, also revealed plans for a new cement plant capable of producing 1.3Mt/yr, which would stand adjacent to the current facility.

Factory workers voiced support for the expansion as a means to combat unemployment and boost local production.


Nigeria: Lafarge Africa has launched ECOPlanet Unicem, the country's first low-carbon multipurpose cement, from its Mfamosing plant in Cross River State. The new product is reportedly designed with over 30% reduction in CO₂ emissions. ECOPlanet will be available nationwide by the end of 2024.


Germany: Canada-based company Rock Tech has promoted a peer-reviewed study by the German Lithium Institute that confirms the potential of byproducts from lithium production to be used in cement manufacture. The study found that leached spodumene concentrate (LSC), primarily composed of aluminosilicates, can replace fly ash as an additive in the cement industry. The study also revealed that adding 20% LSC to Portland cement increases its compressive strength by 10%. The process for producing and utilising LSC has been submitted for a patent.

"The phase-out of coal and the transformation of the steel industry will sooner or later lead to changed or disappearing material streams that have been significant for the cement industry in terms of CO2 savings and product portfolio. The LSC from lithium production has the potential to compensate for these depleting material streams in the future."


Cameroon: Cimpor has inaugurated its new plant in Kribi, Cameroon. Following investments in Côte d'Ivoire, Cimpor embarked on this greenfield project in February 2020, integrating the ‘world's first’ operational flash calcined clay production line, launched on 29 October 2023.

Cimpor Cameroun now has an output of 1.2Mt/yr of cement and 0.4Mt/yr of calcined clay. Cimpor's calcined clay production technology - ‘deOHclay’ – reportedly saves up to 80% in CO2 emissions, up to 35% in electricity consumption and up to 40% in thermal energy consumption per tonne. Compared to a plant with a similar capacity, this technology could reduce CO2 emissions by around 0.2Mt/yr, according to the company. The new plant will reduce the country’s dependence on imports to meet local cement needs.


Chad: The Group Cement of Africa (CIMAF) plans to raise the production capacity of its Chad cement plant from 0.5Mt/yr to 0.7Mt/yr. Anas Sefrioui, President of CIMAF, conveyed this intention to Chad's President Mahamat Idriss Deby Itno, with the intention to meet market demands, reduce costs and create jobs. Sefrioui also announced that the official price of cement bags from the plant will be revised to alleviate public costs. The CIMAF cement plant in Lamadji, north of N'Djamena, commenced operations in June 2017.


India: UltraTech Cement reported a flat net profit for the three month period ending 30 June 2024 of US$203m, compared to US$202m in the same period in 2023. The company's income rose by 2% to US$2.18bn, while domestic sales volumes grew 7% year-on-year to 32Mt, despite a 9% decline from the previous quarter. EBITDA slightly declined to US$383m from US$384m.


Nigeria: The Joint Committee of the House of Representatives is investigating the sharp rise in cement prices in the country. Major industry players, including Dangote Cement and Lafarge Africa, must submit detailed production cost documents to justify the market price of cement. The committee plans to visit the production plants after reviewing these financial records to establish the cost of production and determine a fair price for cement. The inquiry covers production costs from 2020 to July 2024.

One committee member pointed out that Dangote Cement has continued to make significant profits despite sourcing most of its raw materials locally, and questioned why the price of cement keeps rising whilst producers continue to profit. In response, Dangote Cement’s Managing Director, Mr Arvind Pathack, attributed 95% of production costs to imports or foreign exchange impacts, noting significant increases in input costs and logistical challenges exacerbated by the poor state of infrastructure and foreign exchange limitations. The committee called for a review of company policies to potentially lower prices, criticising the Federal Competition and Consumer Protection Commission (FCCC)’s inactivity in addressing the pricing issue.

Chair of the Committee, Jonathan Gaza, said “We are extremely hopeful that this engagement will lead to a reduction in the price of cement. FCCPC has slept on their functions so far; their inactivity and unresponsiveness to price is what has put Nigeria where we are today.”


Uzbekistan: Cement manufacturers in Uzbekistan produced 6.2Mt of cement from January to May 2024, reflecting 35% growth year-on-year, according to data from the local Statistics Agency. In May 2024, production was at 1.7Mt.


Philippines: Taiheiyo Cement Philippines has inaugurated a new US$220m production line at its plant in San Fernando, Cebu, which is expected to support national cement production and reduce reliance on imports. The plant now has a capacity of 3Mt/yr, or 6000t/day of clinker. The new production line replaced the old facility, which was demolished in 2021. The facility incorporates kiln renewal technology that reportedly cuts CO₂ emissions by at least 10% through reduced energy consumption and a lower clinker factor. San Fernando Mayor Mytha Ann Canoy said the new facility is expected to generate 2000 new jobs.


India: Adani Group is planning to acquire cement assets from Jaypee Group, which include over 9Mt/yr of cement capacity, following Jaiprakash Associates' insolvency proceedings initiated in early June 2024. The National Company Law Tribunal in Allahabad admitted Jaiprakash Associates for corporate insolvency on 3 June 2024. Adani would acquire significant assets in the deal, including limestone mines and a power plant, although formal asset sale processes have not yet commenced.


US: Heidelberg Materials has won negotiation for up to US$5m in funding from the US Environmental Protection Agency (EPA) to develop a web-based tool for cement facilities to produce Environmental Product Declarations (EPD). The funding is part of the EPA’s grant initiative to report and reduce emissions from the manufacture of construction materials, which awarded nearly US$160m to 38 recipients nationally.


Philippines: The Department of Trade and Industry (DTI) has urged local cement manufacturers to apply for Tatak Pinoy certification, as the government promotes Philippine-made products. Local manufacturer Republic Cement was awarded the first Domestic Bidder’s Certificate of Preference (DOBID), ensuring the use of local materials in government projects.

DTI Undersecretary Rafaelita Aldaba said "One of our main priority industries under Tatak Pinoy is manufacturing. Hence, we really want local manufacturing companies to apply for the DOBID certificate so we can help them expand their market, boost growth and enhance competitiveness."


Kyrgyzstan: Cement production in Kyrgyzstan totalled 1.01Mt from January to May 2024, a decline of 5.7% year-on-year from 1.08Mt, according to data from the country’s National Statistics Committee. May 2024 saw production of 0.36Mt of cement, a rise of 10.5% year-on-year from May 2023.


Mexico: Regenera, a subsidiary of Cemex, has launched a pilot project at its Broquers Ambiental plant in Querétaro to transform the city’s organic waste into alternative fuel using a drying process known as ‘biosecado’. This initiative makes Querétaro the first zero waste municipality in Mexico, according to the company. The plant now processes almost 90% of the municipality’s waste, transforming over 8000t monthly into biomass to reduce the amount of material sent to landfill.

Vice president of urban solutions at Cemex Mexico, Antonio Balmori, said "This project that we started today at our Broquers Ambiental plant excites me very much because it will take the city of Querétaro to the next level in waste management, where we will seek to take advantage of 100% of the urban solid waste generated in the municipality."


UK: Cemex UK has announced the publication of Environmental Product Declarations (EPDs) for its cement products manufactured at the Rugby and Tilbury plants. The EPDs are for the cement delivered in bulk tankers, covering over 80% of its manufactured cements.

Head of sustainability for Cemex Europe, Paul Fletcher, said "Achieving third-party verification through the International EPD System provides independent and transparent information of our cement’s environmental performance over the entire lifecycle of the product."


France: Irish cement producer Ecocem plans to industrialise a new technology that will be implemented at its Dunkirk site in northern France by 2025. The technology, called ACT, replaces clinker with limestone filler to reportedly reduce the carbon footprint of cement by 70% compared to the average French cement.

The company is relying on public funding from Bpifrance, the Hauts-de-France region and the urban community of Dunkirk.


Spain: Cement consumption in Spain fell by 3.3% in the first half of 2024 to 7.27Mt, a decrease of 0.25Mt from the same period in 2023, according to Oficemen's latest statistics. June 2024 saw a year-on-year decline of 4.2%, with consumption dropping to 1.25Mt. Cement exports also decreased significantly in the first half of 2024, representing a decline of 20.2% year-on-year.

Oficemen's general manager, Aniceto Zaragoza, said "Our forecasts point to a change in trend towards more positive data in the second half of the year. In fact, the figures for average daily consumption, which only consider working days in the comparison, show growth of 5.3%."


Colombia: The cement sector in Colombia is experiencing difficulties due to a contraction in the construction sector. This is attributed to an economic slowdown that has impacted on housing and infrastructure projects. From January – April 2024, cement production declined by 4% year-on-year. The industry is also contending with high production costs, which have reduced profit margins. Delays in infrastructure projects, influenced by the transition in local governments, have further affected demand for cement.