Global Cement News

Tunisia: Jalel Ben Othmane has been appointed Director General of Ciments de Bizerte in replacement of Ibrahim Sanaa who in turn has been appointed Director General of the Carthage Cement.

India: The succession battle within the Chettinad group of companies has culminated in the removal of chairman MAM Ramaswamy from the board of its flagship enterprise, a position he has held for more than three decades.

A resolution to reappoint Ramaswamy was defeated at the 51st shareholders meeting of the Chettinad Cement Corporation on 27 August 2014. However, Ramaswamy was later named as chairman emeritus by his foster son and managing director MAMR Muthiah, who has taken over the reins.

An official statement from the group said, "In acknowledgement of his contribution at the helm of the company's operations until 1999, the managing director announced that Ramaswamy would be appointed as chairman emeritus for life."

Muthiah, who has powered the group's expansion over the last decade in cement, healthcare and logistics, has instilled a managerial culture that is in sharp contrast to the conservative approach favoured by Ramaswamy. Muthiah has announced that the group would push itself into newer geographies in north India. Currently all of the group's cement assets are located in the south.

South African authorities have started a new investigation into imports of cement from Pakistan. This time the inquiry will examine trade dumping allegations made by local producers including Afrisam, Lafarge, NPC Cimpor and PPC.

The application made by the cement producers provided evidence that the difference between the price of cement (the dumping margin) in Pakistan and for imports from Pakistan in 2013 was 48%. Or, in other words, the price of Pakistan cement imported to South Africa was nearly half that of what is was being sold for in the country that it was actually produced in.

The data submitted to the International Trade Administration Commission of South Africa comes from a report by Genesis Analytics on Pakistan cement prices in 2013 and tax information from the South African Revenue Service. Neither source is readily available for more detailed analysis here but data released by XA International Trade Advisors suggests that cement imports from Pakistan rose to 1.1Mt/yr in 2013 and at a value of US$59m. Roughly, this gives a price of US$55/t. This compares to an average price of US$90/t, from the All Pakistan Manufacturers' Association for the first nine months of the 2012 – 2013 Pakistani fiscal year, giving a dumping margin similar to the allegation by the South African cement producers.

Separate industry sources quoted by the Pakistan media on the story reported that the country supplies 1.5 - 1.6Mt/yr of cement to South Africa, its biggest export market, receiving a revenue of US$125m. Although this suggests a dumping margin lower than the one presented to the authorities it is still high.

Other information of note in the investigation notification is that the Pakistan cement imports are only competing heavily with the local bagged cement market in the Southern African Customs Union, which also includes neighbouring Botswana, Lesotho, Namibia and Swaziland. The notification discounts bulk cement imports from Pakistan as being 'prohibitively' expensive suggesting that the Pakistan cement producers have no import infrastructure in southern Africa or that something else is stopping them. For example, the country's market leader for production, Lucky Cement, has export facilities in Karachi with silos and automatic ship loaders. Yet it's only 'brick-and-mortar' presence overseas are projects building an integrated plant in the Democratic Republic of the Congo and a grinding plant in Iraq.

It may also be worth considering that South African industry newcomer Sephaku Cement hasn't joined the dumping allegation. The Dangote subsidiary was set to start producing clinker in late August 2014. This is out of character considering how prominent the Nigerian-based cement producer has been in campaigning against imports to its home nation. However, the Aganang plant in Lichtenburg, North West Province is over 700km from the coast and presumably safe from foreign imports at present.

One final question occurs. How are Pakistan cement producers able to dump bagged cement on the South African market at prices lower than what they are selling it for at home? If individual producers sold their excess at home at a lower price they could potentially undercut their competitors and make a profit. There are many barriers, from input costs to industry structural issues and other reasons that may be preventing this. However, if the South African cement producers succeed in their latest attempt to block imports from Pakistan it may add more impetus to remove such barriers.

Brazil: Antonio Ermírio de Moraes, a former chairman of Votorantim, died on 24 August 2014. De Moraes, who served as chairman and CEO of the company, died of heart failure at the age of 86. At the time of his death, De Moraes held a 25% in the group. His family hold the remaining 75% interest.

India: Harish Badami has taken over as CEO and managing director of ACC effective from 13 August 2014. The former CEO and managing director, Kuldip Kaura, left his position on the same date. The board of ACC, in which Holcim has a majority stake, had approved Badami's appointment in June 2014.

Immediately before joining ACC on 1 August 2014, Badami had served as managing director of Celanese India. He has held similar positions of president and managing director of Dow Chemical India, as well as managing director of Rohm and Haas India, before its acquisition in 2009 by Dow Chemical.