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Vietnam cement exports rise in first seven months 04 September 2014
Vietnam: In the first seven months of 2014, Vietnam earned US$563m from the export of 13.1Mt of clinker and cement, a 24% rise year-on-year in value terms and a 20.4% increase in terms of volume. Indonesia, Taiwan and Malaysia were the largest importers of Vietnamese clinker and cement in this period, according to the Vietnamese Ministry of Industry and Trade.
Indonesia imported 1.42Mt of clinker and cement (worth US$69m), Taiwan bought 0.86Mt (US$37.6m) and Malaysia purchased 0.7Mt (US$34.7m). Cambodia was fourth with 0.29Mt (US$15.6m).
Vietnam's domestic cement sales are expected to rise by 9% year-on-year to between 49 - 50Mt in 2014, while cement and clinker exports are likely to hit 16 - 20Mt. The country exported 15Mt in 2013.
Cemex negotiating refinancing deal 04 September 2014
Mexico: Cemex has announced that it is negotiating with a number of banks in order to refinance part of its outstanding bank debt as it seeks to further lower financial costs and extend its debt maturity.
In a regulatory filing ahead of a possible private bond placement, Cemex said it is in advanced talks with a group of banks aimed at reaching a new agreement by the end of October 2014. Proceeds would be used to refinance part of an existing financing agreement with banks.
Cemex refinanced around US$15bn in bank debt during the 2009 global crisis and in 2012, with around half of the amount left to pay, agreed to reschedule some US$6bn in 2014 principal payments to 2017. Cemex has since lowered that further and owes around US$4.3bn under the agreement, which is due in 2017.
Cemex said the current talks with banks are part of its strategy to improve its financial flexibility and lower its overall debt costs. Company officials said recently that Cemex's main priority is to recover the investment-grade ratings that it lost during the 2009 crisis.
UniCem ground breaking event attended by Nigerian President 04 September 2014
Nigeria: The Nigerian President Goodluck Jonathan has spoken at the ground breaking ceremony of a new line at the 2.5Mt/yr Akamkpa cement plant, owned by United Cement Company of Nigeria (UniCem) in Cross River State. The company, which already operates a 2.5Mt/yr line on the same site, is the third largest producer of cement in Nigeria and aims to further secure this position when the new line comes online in 2016.
President Jonathan used the event to highlight the rapid development of the Nigerian cement industry. "In 2002 the Federal Government of Nigeria formulated the Backward Integration Policy (BIP) in the cement industry with a view to making Nigeria a self-sufficient cement producer," he said. "Within a decade, we have witnessed phenomenal growth in the industry from 2Mt/yr of cement produced locally in Nigeria to 28Mt/yr of installed capacity in 2013."
"Today's event by UniCem is yet another milestone for the company, the industry and the nation at large as this event brings additional 2.5Mt/yr to the nation's existing capacity," he continued. "I am particularly impressed that after five years of inauguration of the first line, we are gathered here today to break ground for the additional 2.5Mt/yr cement line."
Is Egypt even windy?
Written by Peter Edwards
03 September 2014
Announcements this week have highlighted the situation in the Egyptian cement industry, which has been bearing the brunt of increasing fuel scarcity for a while now. At first glance this appears bizzare in what is an oil-rich country but a government drive to make revenue from exports has constricted supply and led to a massive increase in fuel costs. Since the middle of 2012 Egyptian cement producers have faced a gradual decline in supplies, massive hikes in price due to the curtailment of subsidiaries and a scramble for 'alternative fuels'.... like coal!
While heavy fuel oil prices were on the rise as early as 2012, it is in 2014 that the cement industry has really begun to feel the brunt of supply cuts. January and February saw the Egyptian Natural Gas Holding Company (EGAS) cut its allocation of gas to cement producers by 35%, enough to significantly raise competition for the remaining allocation. By May 2013 this has resulted in interruptions to gas supply that closed some plants and slowed down many more. Producers were trumpeting coal as the big new 'alternative' fuel and conversion projects were announced in quick succession. Worse was to come. In June 2014 saw EGAS cut its supply to cement producers by a further 61%.
This relatively rapid turn around in fortunes has been highlighted by two announcements from the industry this week, both from the Italcementi subsidiary Suez Cement. Firstly, Suez updated the industry on its coal conversion project at its Kattameya plant. Both the timescale (completion by September 2015) and the price tag (US$23m) demonstrate the scale of the upset caused by the strangling of the gas supply. The cost implications of this investment and similar investments at three other Suez Cement plants are significant.
Secondly, Suez has announced that ItalGen (another Italcementi subsidiary) has secured a loan to construct a 200MW wind farm at Gabel El Zeit, near Hurghada, to supply its production sites with electricity. With a future target to produce 400MW (40% of Suez's electrical energy needs), this project (mooted since 2008) is a huge departure from established electrical energy sources in Egypt. It is an even larger project, estimated at US$220m. Assuming a ~US$25m price-tag for each of the four coal conversion projects, this brings Italcementi's total current Egypt 'energy stability spend' to a whopping US$320m. It is betting that the oil price trend is not going to reverse any time soon. As prices continue to rise it will be interesting to see what other solutions Egpytian cement producers come up with. The conversion of plants to take alternative or waste-derived fuels and the use of solar installations for plant electrical needs are other ways forward.
All the while, it is important to remember that Suez's projects (and those of other producers) will not be ready for several months at least. It is also important to remember that the same cement producers that are 'suffering' now have enjoyed the subsidies for many years. This makes casualties as the producers adjust to the new market realities a distinct possibility.
Raysut profit rises 6.7% in first half of 2014 03 September 2014
Oman: Raysut Cement Group has seen pre-tax profits for the first half of 2014 rise by 6.7% to US$46m compared with the same period of 2013, according to local media. Demand from the UAE and fierce competition among Omani manufacturers were the main features of the first half, according to Raysut Cement Company's chairman Sheikh Ahmed bin Alawi Al Ibrahim. "Given this background, the company has met with the challenges effectively by holding on to its sales and enlarging the profit for the group as a whole by optimising sales in varied markets," Al Ibrahim added.