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Cement consumption in Russia falls by 10.9% so far in 2016 22 November 2016
Russia: Cement consumption has fallen by 10.9% year-on-year to 44.3Mt in the first nine months of 2016 from 49.8Mt in the same period in 2015. The biggest decreases occurred on the Central, Volga, Siberian and North-Western federal districts, according to data from the Russian Cement Association (CMPRO) and the Russian Construction journal. Cement production has fallen by 10.9% to 43.5Mt from 48.9Mt. The falls in consumption and production have been blamed on a poor construction market although the residential sector picked up slightly in the third quarter of 2016.
India to take 20% hit in cement demand due to demonetisation 22 November 2016
India: Demonetisation policy is expected to reduce cement demand by 15 – 20% until the end of 2016. It will then reduce growth by 3% in the last quarter of the Indian financial year that runs until the end of March 2017, according to a report by Deutsche Bank Markets Research. It added that investors forecast the drop in short-term demand to be ‘severe.’
Research Analyst Chockalingam Narayanan said that he expected demand from infrastructure projects to partially offset weakness in the residential sector. However, investment towards these projects may be impaired where the revenue comes from state government. These bodies rely on up to 10% of their revenue from the property sector that may be adversely effected by demonetisation. Local bodies are responsible for projects such as rural roads, urban development projects, affordable housing, irrigation and more. Larger road and railway budgets are mostly controlled by central government agencies and are expected to be less effected.
All Pakistan Cement Manufacturers Association warns of risk of coal price to industry 21 November 2016
Pakistan: The All Pakistan Cement Manufacturers Association (APCMA) has expressed concern over the effect that rises in the price of coal have had on the cost of cement production. Coal prices have nearly doubled to US$105/t from US$54/t in May 2016, according to the Nation newspaper. The cost of coal contributes more than 30% to the total production cost of cement manufacture. Coal prices have been rising since May 2016 when China started to limit its coal mining capacity. This has since been compounded by stricter local rules on coal transportation in Pakistan. The APCMA has urged the government to focus on the residential sector to diversify the construction industry.
Shree Cement denies links to Shiva Cement deal 21 November 2016
India: Shree Cement has denied that it is in talks to buy a majority stake in Shiva Cement describing media reports as ‘purely speculative.’ Local media had reported that Shree was considering buying Shiva for around US$0.22/share.
Shiva Cement has a 0.2Mt/yr cement plant near Rourkela in Sundergarh district in Odisha with on-going plans to upgrade the site to 1Mt/yr. The company also has captive limestone reserves in the area and produces both Sumangal
Cimpor suspension sees port of Faro lose business 21 November 2016
Portugal: The commercial port at Faro has seen activity stop since June 2016 following the decision by Cimpor to suspend operations at its quarry in Loulé. The cement producer has been the port’s biggest client in recent years and in 2016 it became the site’s only, according to the Portugal News newspaper. A report by the Authority for Mobility and Transport shows that movement at the port fell by 45% year-on-year for the first nine months of 2016. Cimpor stopped operation at its quarry in September 2016 and laid off 57 workers citing the cancellation of major cement export contracts to Algeria. It hopes to resume operations at the site in 2017.