Global Cement News
Search Cement News
Argos gets green light to access more cash 08 October 2014
Colombia: Directors at Cementos Argos have given the green light for an ordinary bond issuance of up to US$495m to be used as working capital and to swap financial liabilities. The company will have three years to carry out the issuance, although it will most likely do so in the coming months.
Previous issuances by Cementos Argos, such as those carried out in 2012 to raise US$495m, have helped the firm expand in Colombia, Latin America and the United States. Argos revealed in August 2014 that it is considering buying Holcim and Lafarge assets in the region, particularly Mexico and Brazil, and has announced that it will also build a US$450m plant.
Pakistan’s sales affected by smuggling from Iran 08 October 2014
Pakistan: During the first quarter of the current fiscal year, which began on 1 July 2014, the Pakistani cement industry posted growth of 9.9% in local sales compared with sales during the first quarter of previous fiscal year. However, exports declined by 8.1% compared with exports during the year-earlier quarter. Overall growth was 4.9% year-on-year for the quarter.
Cement despatches to domestic markets during the month of September 2014 were 2.42Mt, compared with 2.12Mt during September 2013, an increase of 13.9%. Exports during September 2014 were 0.73Mt against 0.82Mt during September 2013, a decline of 10.6%. Total despatches during September 2014 were 3.15Mt compared to 2.94Mt during the same month of 2013, an increase of 7.1%.
Officials said that Pakistan's cement industry is already facing a lot of issues due to high duty/tax structures, impractical imposition of sales taxes, increasing coal import duties, increasing power tariffs and axel load restrictions for haulage trucks that limit load capacities. Now they claim that it is also facing smuggling from Iran.
Domestic cement uptake in the south of the country is being seriously affected due to the influx of Iranian cement. Statistics showed that, against a 10.8% increase in domestic sales in the north during the first quarter of the current fiscal year, the domestic sales in the south showed an increase of only 5.4%.
A spokesman from the All Pakistan Cement Manufacturer's Association (APCMA) pointed out that despatches in the south should have been higher because the exports from this region during the first quarter of the current fiscal year increased by 12.2% to 0.78Mt against 0.70Mt during same period in 2013. On the contrary, exports from the north of Pakistan declined by 17.3% to 1.28Mt during the first quarter against 1.56Mt during same period last year.
The spokesman said that such lopsided sales are 'puzzling' at a time when the economic activities in the south have picked up appreciably. He said that a deep analysis of the situation revealed that the consumption has most probably increased at par or higher than the northern region but that Iranian cement smuggled without paying the duties and sales tax has penetrated the southern market, which is close to the Iranian border.
Gujarat Sidhee Cement appoints V R Mohnot as CFO and company secretary
Written by Global Cement staff
08 October 2014
India: The board of directors of Gujarat Sidhee Cement Ltd has appointed R Mohnot as CFO and company secretary effective from 1 October 2014.
Grand Theft Carbon
Written by Global Cement staff
08 October 2014
It's been an expensive few weeks for Holcim. First, the Venuezuelan state-run outfit Corporación Socialista Del Cemento failed to pay its last instalment of US$97.5m in compensation for its forced nationalisation in 2008. Then the European Court of Justice dismissed Holcim's lawsuit against the European Commission over the theft of 1.6 million emissions allowances in 2010. Here we concentrate on the second story.
Holcim Romania's CO2 accounts held within the Romanian National Registry for Greenhouse Gases were illegally accessed by hackers in November 2010. 1,000,000 CO2 allowances were transferred to an account in Liechtenstein. Another 600,000 CO2 allowances were transferred to a company in Italy, which had account registries in Italy and the UK. Parts were then transferred to accounts in the Czech Republic, the UK and France before being sold on to emissions exchanges in Paris and Amsterdam.
Holcim then tried to sue the Commission, which administers the bloc's electronic emissions trading network, in 2012 for failing to freeze the accounts containing the stolen units, for not returning them and for allowing other companies to turn them in for compliance under the EU Emissions Trading System (ETS). The multinational building materials producer tried to force the commission to pay it Euro17.6m for damages associated with the theft. The amount was equivalent to the 905,000 allowances that remain unaccounted for at a spot price of Euro14.6/unit and an interest rate of 8%.
Other registries were also targeted in early 2011. As much as Euro30m in carbon allowances were stolen at the time, leading to exchanges having to stop trading temporarily.
Although this is a relatively small amount for a multinational company that reported net sales of over Euro16bn in 2013, it feels harsh. If a personal investor had assets stolen from a bank or investment scheme they would expect some sort of compensation.
It should be noted though that it is unclear how the hackers gained entry to Holcim's account details. Successful 'phishing' for account logins via fake emails and the like might suggest lax security on Holcim's side. Or a more conventional hack on the registry server might suggest loose security on the registry's side. Add to this the fact that the price of carbon allowances has fallen since 2010. Reuters estimated that the outstanding allowances would be worth Euro5.1m today.
Hopefully the thefts in late 2010 and early 2011 can be marked down as teething problems. Yet the European Union Emission Trading Scheme is compulsory for 11,000 power stations and manufacturing plants. Any European company that may be less keen on the scheme is unlikely to have its fears settled by high profile cases of carbon credit thefts or the current low price of trading.
Meanwhile, companies and investors involved with China's Guangdong Province carbon emission trading scheme, the world's second biggest such scheme after Europe, may well be watching what happens in Europe closely.
Eurocement shuts down Savinsky cement plant 07 October 2014
Russia: Eurocement has closed down Savinsky cement plant in the Arkhangelsk region for modernisation until 2018. Employees of the plant are reportedly afraid that the production will be eliminated as voluntary resignation was offered by the management of the plant. Savinsky cement plant produced 207,000t of cement in January - August 2014, down by 57% compared with the same period of 2013.