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Eurocement targeting exports to Denmark and UK 16 June 2016
Russia: Eurocement Group has said that it is targeting exports of cement at Denmark and the UK. Company chief executive officer Mikhail Skorokhod said that ‘contracts in Denmark and Britain are forthcoming’ in an interview with PricewaterhouseCoopers that was recorded ahead of the St Petersburg International Economic Forum.
Exports by Eurocement to Finland and the Baltic states have been taking place since the end of 2015 with a gradual increase in sales volumes. In Finland the cement producer has a market share of 5%. Skorokhod added that the devaluation of the Russian Ruble has opened up export opportunities for the company. However, the company has not disclosed the volume of its exports, according to Interfax.
The overall volume of cement exports from Russia in January to April 2016 reached 230,000t with production of 13.6Mt, according to data from the Union of Cement Producers.
Vietnam: Vietnam Construction Material Company (VCM) has inaugurated a cement plant for its StartCemt brand in Dong Nai. VCM also operates a 5000t/day integrated cement plant at Van Hoa, Quang Binh and three cement grinding plants in the south of the country. VCM currently sells over 200,000t/month of clinker and 40,000t/month of StarCemt cement.The StarCemt brand was established on 1 May 2015.
China: Anhui Conch and China Resources Cement have entered into a strategic co-operation agreement. According to the agreement Anhui Conch shall assist the China Resources Cement in the construction and the upgrade of its cement plants. Both parties intend to build a knowledge transfer system to allow their experience in production, technology and business management to be shared. They also have agreed to jointly promote the sustainable and healthy development of the cement industry in China and explore the possibilities of co-operation in China and overseas.
One Chinese cement giant, one massive order
Written by David Perilli, Global Cement
15 June 2016
A Sinoma subsidiary was raking in the big bucks this week with the announcement that it had booked a Euro1.05bn order with the Egyptian government. The order was for six 6000t/day cement production lines plus assorted maintenance contracts from Chengdu Design and Research Institute of Building Materials Industry (CDI).
The order caps a busy month for Sinoma. At the start of June, another subsidiary, CBMI, said that it had picked up deals to build two new lines in Algeria for Groupe des Ciments d’Algérie. Around the same time another project in the country, a joint venture between Lafarge Algeria and Souakri Group, revealed that it had started commissioning its mill. Other assorted cement projects announced so far in 2016 include a waste heat recovery unit for Thai Pride Cement in Thailand, a conversion to coal burning at South Valley Cement in Egypt and various orders for mills via Loesche for Sinoma projects in Vietnam.
The scale of that latest Egyptian order becomes apparent when one looks at Sinoma, or China National Materials Group Corporation’s, annual results. It reported revenue of US$8.08bn in 2015, a slight decrease from US$8.38bn in 2014. Those six lines represent 13% of the group’s entire turnover in 2015. That’s one humongous order. The last time Sinoma signed a cement deal on this magnitude was in August 2015 when Nigerai’s Dangote placed an order at a value of US$1.49bn.
Elsewhere on the balance sheet for 2015, its profit fell markedly by 25% year-on-year to US$150m from US$200m. However, its new order intake grew by 14% to US$5.1bn. Overseas orders accounted for over three quarters of this or US$4.32bn, its highest level on record. This compares to its rival FLSmidth’s new order intake of US$2.8bn in 2015. It declared that it would continue to seek business outside of China in line with the country’s ‘One belt, one road’ policy focusing on Central Asia and South America.
This growth by Chinese engineering companies on the world stage may have been stymied in 2015. The Verband Deutscher Maschinen- und Anlagenbau (VDMA) in Germany reported in April 2016 that the members of its Industrial Plant Manufacturers’ Group (AGAB) had booked orders of Euro19.5bn in 2015, a similar figure to its orders in 2014. This compared to a drop of 63% of large plant orders (not just cement) in 2014 from Euro5.29bn in 2013. AGAB saw opportunity in service industries for its German members as markets stalled in Russia and Brazil, and China’s property market faced its own problems. Research by UBS Evidence Lab, as reported by the Financial Times in May 2016, has taken a different view, suggesting that Chinese construction quarry equipment manufacturers such as Sany, Zoomlion and XCMG were likely to expand their market share outside of China to 15% by 2025. At present the research pegged them at 7%.
Expansion comes with its risks though. In late May 2016 Sinoma International Engineering reported details of a tax dispute it was suffering in Saudi Arabia. The Saudi subsidiary of the company was levelled with a request for unpaid back taxes from 2006 and 2008. At the time it was appealing against a bill of US$18m. In a changing global marketplace some things never change. Global success it seems is taxed.
Belgium: European cement production grew by 0.9% year-on-year to 248Mt in 2015, according to newly published data in the 2015 Activity Report from the European Cement Association (CEMBUREAU).
Individual European countries recorded a mixed performance. Cement production in Spain grew by 3.3% in 2015. However, in Italy production fell by 3.4% and in France it fell by 5%. CEMBUREAU reported strong performance from its members in Eastern Europe, notably in the Czech Republic, Hungary and Romania. In the European Union (EU28) the association reported a 3.7% increase in cement production to 172Mt fro 165.8Mt. However, CEMBUREAU reinforced the face that EU28 cement production remains 37.7% below the production levels recorded in 2007.
CEMBUREAU data uses estimates for some countries where the data is unavailable including Germany, the UK and Poland. The association represents the national cement industry associations and cement companies of the European Union with the exception of Cyprus, Malta and Slovakia plus Norway, Switzerland and Turkey. Croatia and Serbia are associate members of the organisation.