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Canada: The Cement Association of Canada (CAC) has welcomed the British Columbia government's efforts to improve the Province's carbon tax. The British Columbia Carbon Tax is applied only to domestically-produced cement, while imported cement from the US and Asia is exempt, resulting in a net loss to the British Columbia economy. With local manufacturers facing higher costs under the carbon tax, cement imports from jurisdictions without a carbon policy have risen significantly.
The proposed 'transitional incentives,' of US$22m paid over a three year period, to encourage the British Columbia Cement industry to adopt cleaner fuels and further lower emission intensities will assist the current inequality that the industry faces as a result of imports coming from the US and Asia into British Columbia with no carbon tax applied. The cement industry has been working with the British Columbia government and other stakeholders for many years to find a win-win solution to protecting jobs, economic development and the environment.
"British Columbia produces some of the highest quality cement in the world, so the change makes sense both for the environment and for the Province's continued economic prosperity. British Columbia cement is a strategic commodity and a key component of concrete, which is essential to the implementation of the government's ambitious plan for infrastructure development," said CAC president and CEO Michael McSweeney.
"This incentive will help level the playing field for domestic producers of cement. It assists our company to ensure that good jobs stay and continue to be created in British Columbia," said Bob Cooper, vice president of Lafarge Western Canada. "Our competitiveness has been threatened by imports for the past five years and the move by the British Columbia government will also ensure that British Columbia has a long-term and secure local supply of made-in-British Columbia cement."
France: Lafarge has reported that during the fourth quarter of 2014, its sales were up by 2% year-on-year to Euro3.21bn, its earnings before interest, taxes, depreciation and amortisation (EBITDA) were down by 4% to Euro679m and operating income fell by 8% year-on-year to Euro450m. In the entirety of 2014, Lafarge's sales were down by 2% year-on-year to Euro12.8bn, EBITDA was down by 3% to Euro2.72bn and operating income fell by 3% to Euro1.88bn.
"2015 will be an exceptional year for Lafarge. Over the past few years, we have undertaken a structural and fundamental transformation. We have focused on our customers, promoted innovation and reshaped our portfolio to concentrate on fast growing market segments," said Bruno Lafont, chairman and CEO of Lafarge. "In 2014, we completed our 2012 - 2015 cost reduction and innovation objectives a full year ahead of schedule, supporting our solid operating results. Lafarge is now perfectly-positioned to best benefit from upswings in any and all of its markets in an economic environment that, while remaining volatile, will be more favourable in 2015. I am confident that we will drive significant growth of our results and we do expect EBITDA of Euro3 – 3.2bn in 2015."
Cement sales volumes were up by 4% in 2014 thanks to continued growth in most emerging markets and the US, the benefit from innovation actions and the start-up of new plants in India and Russia. Lafarge delivered its 2014 cost cutting and innovation target, generating Euro600m in 2014, Euro370m from cost cutting and Euro230m from innovation. Net debt was further reduced to Euro9.3bn as of 31 December 2014.
Overall, Lafarge sees cement demand increasing in 2015 by 2 – 5% year-on-year, predominantly driven by growth in emerging markets. Cost inflation in 2015 should continue, at a slower pace than in 2014 given the recent changes of fuel oil prices. Lafarge has confirmed its target to generate at least Euro1.1bn of additional EBITDA from its cost reduction and innovation measures in 2015 - 2016. Its capital expenditures in 2015 will be limited to Euro1.1bn. Net debt should be reduced to Euro8.5 – 9bn by 31 December 2015.
New appointments at McInnis Cement
Written by Global Cement staff
18 February 2015
Canada: Alexandre Rail has been appointed as plant manager of McInnis Cement's Port-Daniel-Gascons plant in Gaspé. Rail brings with him 15 years of experience in heavy industry. He joins the company from ArcelorMittal, where he served as a Steel plant manager for seven years.
"We are pleased with our recruitment of an experienced manager in the heavy industry who shares our values in the areas of health and safety, environment and quality. Rail has proven abilities to mobilise employees," said Christian Gagnon, CEO of McInnis Cement. "Rail's family comes from Gaspé, so he is undoubtedly happy to relocate to that region and eager to contribute its local economic development."
McInnis Cement has also named Mark T Newhart as vice president of Logistics and Distribution and as a member of the company's management team. He will develop an efficient distribution network, with responsibility for transport management and marine terminals. Newhart will report to Jim Braselton, senior vice president of Commerical and Logistics.
"With his 30 years of experience in logistics, which includes 20 years in the cement industry, the addition of Mark to our management team is a major milestone," said Gagnon. "Since our business model is based on marine transportation of our products, Newhart's expertise in transportation and marine terminal management will be beneficial for our organisation."
With Newhart's appointment, McInnis Cement's management team is now complete. It comprises: Christian Gagnon as CEO; André Racine as senior vice president of Corporate Development and Legal Affairs; Jim Braselton as senior vice president of Commercial and Logistics; Gaétan Vézina as senior vice president of Operations; Claude Ferland as CFO; Mark T Newhart as vice president of Logistics and Distribution; Marc Lachapelle as senior director of Human Resources; Maryse Tremblay as director of Communications and Corporate Social Responsibility. McInnis Cement has also announced the relocation of its corporate office in downtown Montreal.
Valentines Day 2015 (14 February 2015) saw the kick-off of India's first round of coal mine auctions - who said that the commercialisation of Valentines Day is a bad thing? For those not following the story, here's a brief summary of the key events that have led to the auctions:
Coal, the main fuel used for cement and power production in India, has been in short supply in recent years due to the shortcomings of state-owned Coal India Ltd (CIL), which produces around 80% of India's coal and owns 90% of its coal mines. In 2013-2014, CIL produced 462Mt of coal, missing a target of 482Mt. Demand is expected to reach 950Mt/yr by 2016 - 2017. Numerous cement plants have had to temporarily cease production due to inadequate coal supplies. This is in spite of India's estimated 302Bnt of coal reserves, more than enough to supply both the power and cement industries. Coalgate indeed!
On 24 September 2014, India's Supreme Court cancelled 214 of the 218 coal blocks that had been allocated since 1993. The blocks were for captive use by the cement, steel and power industries, but the allocation process had been accused of lacking transparency. Of the cancelled blocks, 12 belonged to cement companies. The re-allocation of the cancelled blocks commenced in December 2014, when 36 of the 98 viable coal blocks were allocated. A transparent auction process for 21 of the cancelled blocks for end-usage in power, cement and iron production started on 14 February 2015. In March 2015, a further 23 blocks will be auctioned. CIL was requested to steer clear of the bidding by the Indian government.
Reliance Cement and Jaiprakash Associates, as well as Aditya Birla Group's Hindalco Industries, have all won coal mines during the first three days of bidding. Prices ranged from US$22.5/t to US$45.9/t. UltraTech Cement and JSW Cement both placed bids, but have so far been beaten by rivals. There are still many opportunities for cement producers to win coal mines, although whether the locations are suitable is another matter.
With captive coal mines in hand for India's luckiest cement producers, fuel shortages should become a problem of the past. As India's coal-fired power companies are also bidding fiercely in the auctions, power supplies throughout the country should become more reliable. However, one only needs to look at Afghanistan's Ghori I cement plant to see that having a captive coal mine is not always the answer to fuel shortages; due to internal disputes and poor mining equipment, its coal mine production is poor and the plant operates only intermittently. Hopefully, any cement companies new to coal mining will invest in equipment wisely and ensure an efficient supply chain. As with any large purchase, or indeed Valentines Day, India's coal mine auctions are very much a case of caveat emptor...
Dongwu Cement buys Shanghai Biofit Environmental Technology 17 February 2015
China: Dongwu Cement has agreed to acquire Shanghai Biofit Environmental Technology Co Ltd for US$5.11m. With a tier-3 professional contractor qualification for environmental engineering, Shanghai Biofit is principally engaged in organic wastewater treatment, sludge treatment and disposal, comprehensive treatment of urban organic waste and other integrated environment services.