Global Cement News

Myanmar: Siam Cement Group (SCG), Thailand's largest cement company, has announced that it will build a plant in 2013 in Myanmar's Taninthayi region, according to country manager Soontornpol Veerapravati.

"SCG is planning to manufacture its main products in Myanmar and will open four retail stores in Yangon, Mandalay, Nay Pyi Taw and one other major city. It will also expand its outlets in other locations," said Soontornpol.

Cement is currently in short supply in Myanmar although the government is granting more permits for build cement plants. SCG exports at least 22Mt/yr to neighbouring countries, including Myanmar.

India: UltraTech Cement has reported to the Bombay Stock Exchange that it has not issued any press releases concerning rumours in the Indian press that it is in talks to buy Jaypee Group's cement business in Gujarat. It added that the company does not comment on market speculation. Jaypee has not commented.

Indian press reported that UltraTech is planning to buy Jaypee Group's cement business in Ahmedabad for US$700- 890m by the end of 2012. UltraTech is allegedly 'keen' to buy Jaypee's 4.8Mt/yr Gujarat capacity at US$160- 165/t. Jaypee want to sell it at US$180-185/t.

Jaypee Group is the India's third largest cement maker with an installed capacity of 33.5Mt/yr. Jaiprakash Associates, the flagship company of the group, holds the majority of the cement business. However, operations in Gujarat and Andhra Pradesh, which have a total capacity of 9.8Mt/yr, are run by Jaypee Cement, which was hived off six months ago for monetising the asset. UltraTech Cement is a part of the US$24.5bn diversified Indian conglomerate Aditya Birla Group. The company, along with its subsidiaries, has a cement production capacity of 52Mt/yr.

Australia: Australian building materials producer Adelaide Brighton will buy a 30% stake in a Malaysian white clinker and white cement producer, Aalborg Portland Malaysia (APM) for US$29.7m. APM is owned by Aalborg Portland A/S, a subsidiary of Italian entity Cementir Holding. The deal also secures a 10 year supply agreement with APM and continues Adelaide Brighton's efforts to access raw material given its 'maxed-out' production capability.

"The high dollar, rising power costs, the carbon tax and increasing labour costs make building a new plant in Australia too high in terms of capital expenditure costs," said Adelaide Brighton's chief financial officer Michael Kelly. He added that Adelaide Brighton needs to secure imports and that the acquisition provides a strategic position in Asia for the company.

APM is also considering a US$18.6m expansion of the plant to increase white clinker production capacity from about 2015. Imports of cementitious products, including grey and white clinker, cement and blast furnace slag are expected to increase from approximately 1.6Mt/yr in 2012 to more than 2Mt/yr in 2016.

Egypt: Ezzeldin Abu Awad, head of the Cement Traders Society, has said that the current strikes and protests in Egypt have decreased cement production by about 50%.

In comments to the Al-Ahram newspaper he added that the actual demand for cement under the infrastructure project agreements between the Egyptian government and construction firms stands at only 40%. Abu Awad attributed suspended sales to speculations on the Egyptian Exchange (EGX) due to the current political tension.

Elsewhere in the Egyptian industry, Sinai Cement disclosed to the EGX that a rocket propelled grenade attack on 27 November 2012 that was attributed to one of its factories actually hit the Sinai White Cement Company not Sinai Cement's factory.

Russia: Eurocement Group expects cement product consumption to grow by 12% in Russia in 2012 and by 8% - 10% in 2013, according to its president Mikhail Skorokhod.

"We expect cement product consumption to reach 64Mt this year, compared to 56Mt in 2011. There will be growth of over 12%. This is very significant growth and all construction complex needs in Russia are covered by high quality cement from Russian manufacturers," he said. The forecast for the rise in cement consumption in 2013 is 8%-10%, to around 70Mt, this highest output in the post-Soviet period, according to Skorokhod. The production capacity of cement plants in Russia has grown by around 20Mt/yr since 2009.

Skorokhod estimated that the rise in cement prices over the 'past few years' was comparable to the rise in the cost of natural monopoly services and tariffs, from 7% to 15% per year. He predicted that the price of cement would also fall by this range as new capacity comes on line.

Eurocement announced its plans to invest US$388m in a 1.3Mt/yr plant Sverdlovsk plant on 3 December 2012. The Russian construction materials group has 16 cement plants in Russia, Ukraine and Uzbekistan with a combined production capacity of 39.2Mt/yr of cement.