Global Cement News

US: Heidelberg Materials North America has secured funding for a feasibility study for a 2Mt/yr carbon capture installation at its Mitchell cement plant in Indiana. The study will also investigate possible storage and utilisation solutions for a future installation. The producer says that the US government's Department of Energy has pledged US$5m in funding towards the US$10m study.

Heidelberg Materials North America president and CEO Chris Ward said “We are pleased for this additional federal funding to help move our Mitchell carbon capture project forward. Heidelberg Materials recognises the significant role that carbon capture will play in achieving its goal of net zero carbon, and we are very excited to take the next steps in exploring this technology at our new cement plant in Mitchell.”

Trinidad & Tobago: Trinidad Cements' sales were US$309.6m in 2022, up by 9% year-on-year. Group earnings before interest, taxes, depreciation and amortisation (EBITDA) rose by 19% to US$77.0m. The Trinidad and Tobago Guardian newspaper has reported that the producer recorded a US$16.1m loss during the fourth quarter of the year. The producer attributed this to a weather-related drop in cement demand across its markets, as well as restructuring costs for its Barbados-based subsidiary Arawak Cement.

Trinidad Cement chair David Inglefield and managing director Francisco Aguilera Mendoza said "We will ensure that our operations remain resilient by continuing effective cost management initiatives to maximise value in this challenging economic environment. Additionally, we expect improved productivity and efficiency of our equipment on completion of major planned maintenance in 2023."

UK: John King Group has acquired valve manufacturer DAB Valves for an undisclosed amount. DAB Valves sells a variety of valves and associated equipment within their range from slide and butterfly valves to gravity flap diverter valves and drop out boxes. The 40-year old company is based near Parwich in Derbyshire.

David Wadworth the managing director of John King Group, said “In acquiring DAB Valves we have added a complementary range of products to the existing John King Group portfolio. We are delighted to announce that DAB Valves
will continue to be manufactured in our Yorkshire based factory where we have a full complement of machinery to be effective in this objective. We are delighted to harness our production capabilities with the on-going support of Bob Wright and the DAB Valves design team who have over 40 years of industrial and applicational expertise.”

Bob Wright, the managing director and owner of DAB Valves, added, “Selling the business to John King Group is an exciting one. Yes, it frees up some of my time and enables me to focus on what I love the most, which is the design and engineering of the Valves. Having John King Group ambitious team behind DAB Valves, I know will take the brand to the next level. You only have to visit their Leeds manufacturing site to feel the energy and hunger for success, along with their continued reinvestment in equipment and people.”

John King Group says that its purchase of the DAB Valves brand will further strengthen its global support network and in-house design, engineering and manufacturing capabilities.

Vietnam: Nghi Son Cement Corporation has despatched its first batch of cement to customers in the US. The shipment consisted of 31,500t of cement produced at the company's Thanh Hoa cement plant. Việt Nam News has reported that the producer moved into the US market due to declining cement demand domestically.

Nghi Son Cement Corporation is a joint venture of Vietnam Cement Corporation (Vicem), Japan-based Taiheiyo Cement and Japan-based Mitsubishi Materials.

The two largest cement producers in Japan released their results for their 2023 financial years this week. Much like manufacturers elsewhere in the world they reported mounting sales revenues, but they also noted losses. Input prices such as coal rose in 2022 and these were passed on to consumers in the form of higher prices. However, this was insufficient to stop them making a loss.

In the case of Taiheiyo Cement, its domestic sales volumes of cement remained stable at 13.4Mt in the year to 31 March 2023. It made a loss at home in Japan but still reported a profit in its overseas businesses, despite export volumes falling by 41% year-on-year to 2.44Mt. The group also noted delays at construction sites due to a lack of workers. Recent domestic developments for Taiheiyo include an agreement in October 2022 to buy the cement business of chemicals company Denka. Outside of Japan, in China, the group suspended the production and sale of cement from its Jiangnan-Onoda Cement subsidiary in February 2023 citing a 'tougher competitive environment,' although it justified this decision as part of its strategy to refocus on Southeast Asia. Then, in late April 2023, the company was forced to stop its proposed acquisition of the Tehachapi cement plant in the US due to an inability to obtain regulatory approval.

Sumitomo Osaka reported a similar situation, with cement sales volumes also down year-on-year. Again, cement price increases were unable to catch coal prices made worse by negative currency exchange effects. Having got the bad news out of the way, it then it took the opportunity to outline its medium term strategy to 2035. It said that becoming carbon neutral was the key to this. In its 2022 financial year cement accounted for around 70% of total sales. However, it is now aiming to reduce this to 65% by 2025 and 50% by 2035. If this sounds familiar this is because it is similar to what Holcim is doing with its growing light building materials division and its diversification away from the heavy building materials trio of cement, concrete and aggregates. Sumitomo Osaka plans to invest over US$3.5bn towards this goal by developing its presence in the semiconductors sector, building its business in Australia and starting new ventures in decarbonisation.

Of the other cement producers, Tokuyama Corporation said in late April 2023 that it was considering suspending operation of one of the three kilns at its 4.54Mt/yr Nanyo cement plant as part of measures to strengthen profitability. It reported a growing loss for the current financial year that it blamed on raw material and fuel costs. Mitsubishi Materials and Ube Industries formed their merged cement businesses in April 2022 known as Mitsubishi UBE Cement Corporation. Ube said, as part of its latest financial results, that, despite a gradual decrease in the domestic market, cement sales had remained stable but that the business was “heavily affected” by rising energy prices such as coal. It added that demand for cement and concrete remain strong in its overseas market in North America.

Graph 1: Sales and exports of cement in Japan from 2013 – 2022. Source: Japan Cement Association.

The Japanese cement market peaked in the 1990s. Domestic sales of cement in Japan have declined over the last decade, as can be seen in Graph 1 above, but at a slower rate. Exports rose to a peak of just under 12Mt in 2017 but have slipped a little since then. Data from the Japan Cement Association placed production at 53.2Mt in 2022 compared to 61.7Mt in 2013. This trend explains the move by the cement producers towards decarbonisation, offshoring, diversification and consolidation. The bump in fuel prices over the past year may have accelerated this process, as examples such as Taiheiyo Cement’s takeover of Denka and Sumitomo Osaka’s new business strategy suggest. The race continues to keep cement production profitable in a changing business environment.