Global Cement Newsletter

Issue: GCW679 / 02 October 2024

Headlines


Bangladesh: Confidence Cement is building a new 1.8Mt/yr cement grinding plant at Narsingdi. The project has an investment of US$68m, according to the Daily Star newspaper. Germany-based Loesche is reportedly supplying equipment for the unit, which is scheduled to start operation in early 2025. Around two-thirds of the project cost is being supplied by loans with the rest coming from company equity.

Confidence Cement currently operates a 1.2Mt/yr grinding plant near Chattogram.


Energy has been the theme for a couple of cement news stories of note from Egypt this week. The first concerns the government’s impending plan to centralise distribution of mazut (heavy fuel oil) to cement plants to help them cope with ongoing power shortages. Earlier in the week Cemex signed a deal with the Assiut Governorate to operate a second municipal solid refuse processing unit in the country. The company’s first Regenera facility, in Mahala, started operations in May 2024. Another story from mid-September 2024, along the same theme, covered the inauguration of an 18MW waste heat recovery (WHR) unit at Heidelberg Materials Egypt's Helwan Cement plant.

The wider story is that the country has faced so-called load shedding, or power rationing, since mid-2023 due to falling gas production, rising energy demand and negative currency exchange effects making it harder to buy fuel imports. The power cuts were extended in duration in July 2024 due to a heat wave. The government then said in late September 2024 that it is making investments to prevent domestic power cuts in 2025.

The cement stories mentioned above show some of the ways cement companies cut their energy costs. Two potential ways of doing this are to increase the use of alternative fuels (AF), such as municipal solid waste, or to install a WHR unit. Titan Cement, for example, reported AF thermal substitution rates of above 40% in Alexandria and above 30% in Beni Suef in the first half of 2024. The local press hasn’t reported power shortages amongst the country’s cement producers, but the plans to control the distribution of mazut suggest that either ‘something’ has happened or the government is trying to avoid ‘something.’ Readers may recall that producers have periodically faced step changes in power supplies over the years. In the mid-2010s, for example, lots of plants switched from heavy fuel oil and gas to coal. The energy price fluctuations following the start of the Russia - Ukraine war in 2022 then saw the price of coal rise.

However, what the foreign-owned producers have complained about in the first half of 2024 is the declining exchange rate of the Egyptian Pound. Cementir, Cemex and Titan Cement all noted this. However, Titan reckoned that International Monetary Fund and European Union investment had actually eased the economic situation in the first half of the year leading to an increase in the number of large construction projects.

One effect of the currency problems upon the cement market has been a focus on exports. At the start of September 2024 the Federation of Egyptian Industries said that national cement consumption in 2024 was expected to drop by 4% year-on-year to 45Mt. However, exports were projected to rise to 15Mt. The first and second most popular destinations so far in 2024 have been the Ivory Coast and Ghana. Yet, exports to Libya, the third biggest external market, may have had the biggest effect. These have been blamed for creating a shortage of trucks that was causing delays to the local construction sector. The round-journey from Egypt to Libya can take up to 12 days. This has left building sites bereft of raw material deliveries because all the trucks are elsewhere! Vicat acknowledged the growing importance of imports for its business in Egypt in its half-year report for 2024. It said that ‘sluggish’ domestic market conditions “were more than offset by growth in cement and clinker volumes for export to the Mediterranean and Africa regions.”

The wider picture of the cement sector in Egypt remains one of overcapacity with integrated capacity estimated above 70Mt/yr. The government introduced cement production quotas in mid-2021 and this stabilised prices (and profits). The recent state of the local economy may have strained this, but the latest round of external investment appears to have buoyed things for now. Although the effects of the Israeli military action in Lebanon may have unforeseen consequences upon neighbouring markets. In the meantime, cutting energy costs and growing exports offer two ways for producers to raise their profits.


Türkiye: Çimsa Çimento has appointed Ozan Keskin as its Vice President of Operations. He will succeed Memet Metin Çalışkan in the role from the start of November 2024.

Keskin has worked in the cement industry for over 20 years. He started as a maintenance engineer at OYAK Adana Çimento in 2003. He later worked for Aslan Çimento, eventually becoming Technical Services Manager in 2015 and Investments & Project Manager in 2017. He then jointed Çimsa Çimento in 2018 as Project Manager. He subsequently became a Plant Manager and Investments and Maintenance Director. He is a graduate in mechanical engineering from the Middle East Technical University in Ankara.


Germany: Norway-based Capsol Technologies has won a feasibility study from a German cement producer to assess the implementation of its CapsolEoP (End-of-Pipe) technology at a cement plant. The technology aims to capture 400,000t/yr of CO₂.

CEO Wendy Lam said "Capsol continues to build a position as a preferred carbon capture technology provider for the cement industry."


India: JSW Cement has commissioned another 2Mt/yr of grinding capacity at its Vijayanagar plant in Karnataka, increasing the plant's total capacity to 6Mt/yr. The expansion, which cost US$55m, increases the company's overall capacity to over 20Mt/yr.  JSW Cement was set to raise US$476m through an initial public offering (IPO), but the Securities and Exchange Board of India has placed the IPO plans ‘in abeyance’ as of September 2024, according to the Economic Times. Funds from the IPO were earmarked for debt repayment and financing a new unit in Nagaur, Rajasthan.

Chief executive officer Nilesh Narwekar said "This new capacity at Vijayanagar is a significant step towards increasing our overall capacity to 40.8Mt/yr while maintaining our commitment to sustainability."


Saudi Arabia: Turboden, a subsidiary of Mitsubishi Heavy Industries, has announced its first project in Saudi Arabia — a 13MW organic rankine cycle (ORC) power plant at Riyadh Cement Company. This marks the first ORC plant in the Kingdom and the largest globally.

The plant will capture residual heat from the cement plant's clinker coolers and pre-heaters (2 kilns of 5000t/day each), offering high energy efficiency and eliminating water consumption. Sinoma Energy Conservation serves as the project's engineering, procurement and construction contractor.

General manager Andrea La Gioia said "Turboden is honoured to spearhead this groundbreaking project in collaboration with Riyadh Cement Company. With around 460 ORC plants in 52 countries, 50 in ‘waste’ heat recovery application, our ORC technology represents a game-changer in the global energy landscape, and we are proud to support the Kingdom of Saudi Arabia in its transition towards cleaner, more sustainable energy sources."


India: UltraTech Cement will procure an additional 7MW of wind-solar hybrid power production capacity from Continuum MP Windfarm, increasing total procurement from 14MW to 21MW. This power is supplied from its 100MW project in Ratlam District in Madhya Pradesh. To facilitate this, UltraTech has raised its shareholding in Continuum MP Windfarm from 3.28% to 5.46% by investing approximately US$2.9m. The acquisition is expected to complete within 120 days following amendments to the power purchase Agreement, share purchase agreement, and shareholders agreement.


Ghana: The Minister of Trade and Industry, Kobina Hammond, has directed cement manufacturers to secure licences or cease operations immediately, in compliance with the new Ghana Standards Authority's (GSA) Manufacture of Cement Regulation, 2023 (LI 2480). This regulation mandates re-registration and licensing of existing operations and bars unlicensed new plants. It came into law in 2024 and seeks to address consumer concerns over rising cement prices and promote quality assurance.

Director-General of the GSA, Alex Dodoo, stated that all current manufacturers are operating illegally without a licence. Dodoo said that none of the cement producers in the country had applied for a licence to operate in accordance with the law.


Czech Republic: Holcim Česko, owner of the Čížkovice cement plant, will construct a new calcined clay processing line with an investment of US$44m, marking the largest investment in its history. The project, beginning in January 2025 and aiming for completion by the end of 2026, aims to reduce energy use and end reliance on fossil fuels. The Czech Ministry of the Environment has contributed US$14.5m towards the construction.

Holcim Česko CEO Miroslav Kratochvil said "The new calcined clay processing line represents a revolutionary step in the cement industry. Calcined clays will become a key material in our company's new cement products and will have a significantly lower carbon footprint. This innovation will enable the company to make a significant contribution to environmental protection and emission reduction."


Austria: Holcim is set to significantly reduce its carbon footprint with the installation of a new clinker cooler system and a large-scale photovoltaic system at its Mannersdorf cement plant. The clinker cooler project is valued at approximately €10m, and aims to cut heat consumption and reduce CO₂ emissions by 18,000t/yr. Completion is expected in early 2025. The solar project will be fully operational by 2025, and will cover approximately 15% of the plant’s energy needs and reduce CO₂ emissions by an additional 12,700t/yr. 2.7MW of solar panels were erected at the site of the former chimney on the plant’s premises.

Plant manager Helmut Reiterer said "Sustainability requires decarbonisation, i.e. continuously reducing the CO₂ emissions from our production activities. We are placing an investment focus on energy-efficient production by modernising our machinery, but also on expanding green energy."


Egypt: Starting in October 2024, the Egyptian Ministry of Petroleum and Mineral Resources will centralise distribution of mazut to cement plants to ensure continued operations amidst the country's power shortages. Deputy PM Kamel El Wazir announced the plan, responding to requests from cement producers for a reliable fuel supply to maintain the stable production and distribution of cement.

Cement plants are required to submit a report on quarry material prices over the past three years, highlighting price increases and their impact on the industry. The Cement Division of the Building Materials Industry Chamber also requested consistent export support payments, the extension of investor rights to quarry resources, and the testing of pozzolanic cement for standard compliance.


Brazil: Votorantim Cimentos has launched Blenture, a new brand of cement and concrete designed to reduce CO₂ emissions and promote sustainable construction practices. Blenture products, developed through significant investment in research and development, align with the company’s decarbonisation strategy to utilise recycled materials and non-fossil fuels. Blenture cements and concretes, certified with environmental product declarations by AENOR, reportedly offer a 30% lower carbon footprint while maintaining quality, strength and performance.


Brunei: Heidelberg Materials Butra Sdn Bhd has become the first cement producer to receive a ‘green’ label certification for its Portland composite cement. The Singapore Environment Council awarded the certification, which recognises products meeting stringent environmental standards such as lower carbon emissions and sustainable material use.

Managing director of Heidelberg Materials Butra, Terence Ong, said “By offering environmentally responsible products, we aim to contribute to the nation’s infrastructure development while minimising our ecological footprint.”


Italy: Heidelberg Materials has launched a feasibility study at its Rezzato-Mazzano cement plant to explore a source-to-sink carbon capture and storage (CCS) solution, potentially making it the first in Italy to produce carbon-captured net-zero cement, according to the company’s press release. The aim of the study is to evaluate the feasibility of capturing CO₂ from cement production and transporting it via pipeline to the Ravenna CCS storage hub under the Adriatic Sea. Phase 1 of the Ravenna CCS project will be carried out with the help of a joint venture between Italy-based integrated energy company Eni and energy infrastructure subsidiary Snamprogetti, involving discussions between the three companies for a technical evaluation. The project aims to leverage Eni’s depleted gas fields in the Adriatic Sea, which would be converted for use as permanent CO₂ storage sites. The total storage capacity of these fields is estimated at more than 500Mt. Snam is committed to developing a pipeline network to transport CO₂ from emitters to the Ravenna CCS hub.  

Chair of the managing board of Heidelberg Materials, Dominik von Achten, said "We are excited to explore the economic feasibility of a carbon capture initiative in the Mediterranean. Our ambition at Heidelberg Materials is not only to implement a decarbonisation initiative that is highly efficient in terms of resources and energy, but also to provide an important impetus for the development of a regional CCS cluster."

Member of the managing board of Heidelberg Materials and responsible for Europe, Jon Morrish, said "With an aspired capture rate of more than 95% of our plant’s emissions, this initiative aims to explore options for industrial-scale CCS in Italy. This would enable us to supply locally produced, carbon captured net-zero cement under our evoZero brand to customers in the region."


Ethiopia: Prime Minister Abiy Ahmed has inaugurated the Lemi National Cement Factory, built by a joint venture between West International Holding, the African arm of West China Cement, and East African Holding Company. With a production capacity of 15,000t/day, this facility is now reportedly the largest in Ethiopia, according to Xinhua news. Located 150km north of the capital city of Addis Ababa in the Lemi Building Materials Industrial Park, the project cost US$600m.

Prime Minister Abiy Ahmed said "The project exemplifies the swift and efficient delivery of crucial infrastructure. Congratulations to all those involved in realising this important project, which now produces 50% of the cement made by plants across the country."


India: Ambuja Cement has proposed the establishment of a cement plant at Ramannapet, eliciting concerns from local residents over potential environmental impacts. The proposed plant is intended to be built on 70 acres initially designated for a dry port, and involves an investment of US$167m, according to the Deccan Chronicle. The River Musi, located 14km from the proposed plant, is expected to be at risk, as well as local residents living near the site. The Pollution Control Board is scheduled for a public hearing on 23 October 2024 regarding this matter.

Rythu Sangam district president Meka Ashok Reddy highlighted the community's concerns, noting that fertile agricultural fields within a 14km radius could be turned into ‘wastelands’, and crop yields along the River Musi might drop by 30% due to water contamination. He said that 10 villages around Ramannapet would be affected by pollution from the proposed plant.


Pakistan: The cement industry in Pakistan is experiencing a significant decline, with local dispatches for September 2024 projected to fall by 22% year-on-year to approximately 2.79Mt. This decline is reportedly due to a slowdown in construction activities, exacerbated by rising costs of construction materials. According to Topline Pakistan Research, local cement sales for the first quarter of the financial year 2025 are also expected to decrease by 21% compared to the same period in 2023.

Despite a slight month-on-month increase in dispatches from 2.75Mt in August 2024, the year-on-year data highlights a continuing slump in construction and a sharp increase in cement prices. However, there cement exports are projected to increase by 27% month-on-month and 36% year-on-year. Total cement sales for September are estimated at 3.56Mt, marking a 14% decline year-on-year but a 6% increase from August 2024. Capacity utilisation in the sector is estimated at 52% for September 2024, an improvement from August 2024’s 47% but still below the 60% recorded in September 2023.


Jamaica: Senator Aubyn Hill, minister of industry and commerce, has reported an 8% month-on-month decline in cement production from January to August 2024, citing scheduled maintenance at Caribbean Cement Company as a partial cause. The maintenance took place from 12 August to 3 September 2024. Alongside the production drop, there was also a decrease in total domestic sales during the same period. Senator Hill has urged cement importers to utilise quotas issued by his Ministry to mitigate the industry shortfall.


Egypt: Cemex has signed an agreement with Assiut Governorate to operate its second Regenera facility in Egypt. This facility processes about 7,000t/month of municipal solid refuse, treating it to generate alternative fuels before compost production, thereby ensuring minimal residual materials go to landfill. The Assiut agreement follows the first Regenera facility in Mahala, which began operations in May 2024. Cemex has invested over US$2.5m in an alternative fuel dryer at the Assiut plant.


US: Colorado-based energy company NovoHydrogen plans to establish a hydrogen production facility at the Ash Grove Cement plant near Durkee, Oregon. Funded by the 2021 federal Bipartisan Infrastructure Act, the plant aims to start producing hydrogen fuel by 2028, according to CEO and founder Matt McMonagle. The hydrogen produced would be stored at the plant to be used to fuel trucks and other vehicles on-site, as well as potentially being used to power the plant. The construction of the plant will reportedly create 50 jobs.

Phillip Teintze, manager at the Durkee plant, said "The Ash Grove Cement Durkee plant is active in many opportunities to decarbonise our industry. Solutions for low carbon cement manufacturing are significantly challenging in terms of processes and expense. The Durkee plant is excited to see the development of NovoHydrogen’s efforts with the Department of Energy’s Pacific Northwest Hydrogen Hub. As hydrogen becomes environmentally and economically viable, we believe our facility could act as a distribution site, and potentially utilise hydrogen as a fuel to displace traditional fossil fuels.”


Colombia: Ultracem's general manager, Julián Vásquez, has announced plans to establish a clinker kiln in the municipality of Galapa with an investment of US$100m. This new facility aims to eliminate the need to import clinker, which is currently sourced from Turkey, Vietnam, and Spain. The kiln is expected to be operational within two years.

Vásquez said "This will give us competitive advantages and will involve increasing the workforce from the 1200 direct and indirect jobs we generate today by 20%."


Vietnam: The Philippines, Bangladesh and Taiwan were the leading importers of Vietnamese cement and clinker in the first eight months of 2024, reports the General Department of Vietnam Customs. The Philippines imported 5.35Mt valued at US$214.3m, seeing a decline of 1.8% in volume and 12.97% in value year-on-year. Bangladesh followed, purchasing 4.18Mt worth US$133.9m, up by 5.2% in volume but down 11.4% in value compared to the previous year. Taiwan ranked third, importing 994,735t valued at US$35.5m, with decreases of 17.2% in volume and 24.5% in value year-on-year.

From January to August 2024, Vietnam's total earnings from cement and clinker exports reached US$788.8m from over 20.5Mt, marking a decrease of 3.2% in volume and 14.5% in value year-on-year.


Kyrgyzstan: MP Alisher Kozuyev has called for the removal of the ban on importing Uzbek cement, stating during a parliamentary committee meeting on 24 September 2024 that it would reduce prices and enhance quality for Kyrgyz consumers by increasing market competition. He argued that the current ban supports local monopolies and raises domestic cement prices. The ban was introduced three months ago and is designed to protect local manufacturers, according to officials. Nonetheless, deputy minister of economy and commerce, Choro Seyitov, warned that cheaper Uzbek cement could threaten local industries, especially in the Osh region, and risk jobs and tax revenue. Seyitov also noted that some Uzbek cement does not meet Kyrgyz standards and certification requirements, and accused Uzbek exporters of price dumping.


Egypt: Cemex has won a place on Fortune's 2024 Change the World list for its sustainable business practices. This recognition, the fourth for Cemex, highlights its collaboration with VeryNile to clean the Nile River and develop sustainable solutions for discarded materials. Supported by the Ministry of the Environment, VeryNile focuses on removing inorganic matter from the Nile, upcycling plastics, and converting non-recyclable materials into alternative fuel for Cemex's Assiut cement plant. This initiative not only reduces pollution but also improves water quality for the local community and provides alternative employment for 150 local fishermen and women affected by contamination of the Nile.

CEO of Cemex Fernando González said "We are once again honoured by Fortune's recognition of our sustainable business model, which aligns environmental conservation with social empowerment. The VeryNile initiative exemplifies how companies can collaborate with NGOs and society to change the world for the better."


India: Ambuja Cements has entered the Alliance for Industry Decarbonisation (AFID), becoming the first cement manufacturer worldwide to join this global platform. AFID aims to accelerate the net zero transition in energy-intensive sectors, like cement, in accordance with the Paris Agreement. Ambuja Cements has set a net zero target for 2050, with goals approved by the Science Based Targets initiative (SBTi). The company plans to invest US$1.2bn in renewable energy projects totalling 1GW and 376MW from waste heat recovery systems to power 60% of its expanded capacity by the 2028 financial year. This strategy will reportedly lower its carbon footprint, and utilise more than 8.6Mt of discarded materials in the financial year 2024.

Non-executive director of Ambuja Cements, Mr Karan Adani, said "This marks another significant step for Ambuja in its sustainability journey. We are already amongst the lowest emission intensity cement producers globally and are undertaking a number of strategic initiatives to further reduce our greenhouse gas emissions footprint. Being a member of the Alliance for Industry Decarbonisation will allow us to leverage the experiences of global cross-sector industry peers. And, in turn, share our approach to decarbonisation."


Bolivia: The Viacha cement plant, operated by Sociedad Boliviana de Cemento (Soboce), has launched a pilot to co-process discarded electrical and electronic equipment into alternative fuels. This initiative, developed in coordination with the Ministry of Environment and Water, involves the management of 133t of materials. The process includes converting discarded plastics with brominated flame retardants into energy for the plant.

CEO of Soboce, Francisco Shwortshik, said "Viacha has all the licenses and environmental authorisations for the co-processing of alternative fuels. Today we are witnessing a historic milestone for the industry, because it marks the beginning of the era of alternative fuels, as a sustainable environmental solution for the country."


France: F Scott, a French group based in Switzerland, is set to construct a new grinding plant in Montoir-de-Bretagne, Loire-Atlantique, by 2027. The €55m investment is expected to create 50 jobs, according to API agency. The plant will import 300,000t/yr of blast furnace slag and a similar amount of clinker by ship, with plans to potentially switch to calcined clay for producing low-carbon cement. F Scott's proposal was approved in mid-late 2023 following a call for expressions of interest by the major maritime port of Nantes-Saint-Nazaire for a bulk products storage and industrial processing unit.


India: Union Steel and Heavy Industries Minister Haradanahalli Kumaraswamy has visited the Cement Corporation of India (CCI) plant in Bokajan, Assam, where he emphasised the potential of the facility to benefit local communities. During his visit, Kumaraswamy inaugurated a hot gas utilisation project at the plant's raw mills and laid the foundation for a 1MW grid-connected solar photovoltaic plant, reports the Deccan Herald. He also discussed important local issues, including the need for upgrades at the Bokajan cement factory and pollution control. CCI chair and managing director Sanjay Verma outlined plans to upgrade the plant’s equipment over the next three years and highlighted the employment of local labour as vital for regional economic growth.