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Cemex starts paying its tax backlog 14 March 2012
Mexico: Cemex has paid 20% of the US$361m in taxes it owes the Mexican government, with the rest due in January 2013.
The company said it made a US$72m payment on 1 March 2012. It said it has an option to extend the January 2013 obligation and opt for 36 instalments instead, a move that would cost the company a bit more.
"Cemex thinks it has adequate provisions to meet the (tax) requirement," the company said in a statement.
In 2008 the Supreme Court overturned a ruling that protected Cemex from paying taxes linked to investments in offshore tax havens. The court cited several articles in Mexico's income tax law that required Mexican companies to pay taxes locally on investments in countries where there are no taxes or where levies are 75% lower than in Mexico.
Pakistan consumption stagnant for 4 years 14 March 2012
Pakistan: Cement manufacturers in Pakistan are regretting their decision to increase capacity as consumption has remained stagnant over the past four years, according to the All Pakistan Cement Manufacturers Association (APCMA). Exports are also declining, forcing the sector to operate at 69% of its installed capacity.
An APCMA spokesman explained how capacities were increased when the economy was booming and that most of the plant capacities were increased in the northern part of the country. For these regions Afghanistan was the only export market but its potential was limited. Exports to India were limited at that time and today as well due to many non-tariff barriers erected by India.
The spokesman regretted that the growth during the past four years had been much below expectations and that the government also failed to provide funds for, what he called, 'essential' infrastructure. The fierce competition between the mills sitting on huge capacities kept the rates of the commodity much below the average inflation in the country, he added. Rates of inputs of the industry increased in line with the inflation and rupee devaluation while the cement prices increased by just 6% from the average cement rates in 2006.
The APCMA spokesman added that exports, which provided some relief to the industry in the past few years, have declined at a rapid pace during the first eight months of the current fiscal year (July 2011 to February 2012). During this period the decline in exports was 5.57% to 5.62Mt from 5.95Mt during the corresponding period in 2010-2011. He said that exports to India, mostly via train, had increased by 39.5%.
Tanzania’s producers urged to hold prices 14 March 2012
Tanzania: The Tanzanian government has urged cement producers to establish their own depots in remote areas to reduce the risk of rising cement prices. The Minister for Industry, Trade and Marketing, Dr Cyril Chami, said the time had come to ensure cement prices were uniform throughout the country.
"Although the manufacturing firms incur transport costs in shipping the product to the market, they offer it at retail prices that are not affordable to ordinary people," said Chami. He cited the case of Coca Cola, which sells its drinks at the same price in all the regions, saying this has been made possible with the availability of depot services. "Cement manufacturers should emulate what the soft drink producers are doing by establishing their own depots so as to ensure equitable retail price of the products in all the regions," he added.
According to one of the major producers in the country, Tanzania Portland Cement Company (TPCC), development in the construction industry will increase demand for cement demand rapidly. A recent report conducted by the Tanzania Securities Limited (TSL), shows that the cement industry is expected to grow further due to high demand from the construction industry, which has already increased by 10% since 2007.
"We expect demand to grow at 18% if the retail business, infrastructure development and mining investments are sustained and the economic momentum quickly returns to pre-global financial crisis levels," said Moremi Marwa, the TLS's report analyst.
Tanzania remains a net importer of cement and, despite the recent up-cycle expansion of about 1.4Mt/yr, there are plans to increase capacity by 0.75Mt/yr. This comprises 0.25Mt/yr from Lafarge (Mbeya Cement) and 0.5Mt/yr from Lake Cement in the next two years.
Carolinas Cement clears hurdle for new plant 13 March 2012
US: Officials from Carolinas Cement Company have announced that the Division of Air Quality of the North Carolina Department of Environment and Natural Resources (DENR) has issued an air quality permit to parent company Titan America LLC to construct a cement plant in Castle Hayne. The issuance comes after four years of technical review of the proposed facility to ensure it will comply with North Carolina's air quality regulations and standards.
The permit was issued after extensive evaluation by DENR, including using air models that incorporate government-approved local meteorological, topographic and site-specific information. The models calculate the concentrations of regulated emissions at the boundaries of the plant property and ambient concentrations throughout the local region and other designated locations to assure they are below legal limits.
"These laws and regulations governing industrial emissions are among the strictest in the world," said Dan Crowley, Titan America's VP of Corporate Engineering. "The issuance of our air quality permit is only a first step. After the plant begins operating we will be subject to unannounced audits by State and Federal regulators as well as internal compliance audits to ensure our emissions are consistently within permitted limits." Carolinas Cement will meet all the new Environmental Protection Agency federal regulations for Portland cement plants that were finalised in 2010, and these regulations are fully represented in the Department of Air Quality permit.
Now that the air quality permit has been issued, Carolinas Cement plans to proceed with completing the federal Environmental Impact Statement (EIS) needed to obtain necessary wetlands permits. The EIS is an 18-24 month process led by the US Army Corps of Engineers (COE) and it requires Carolinas Cement to hire an independent third party to conduct studies of potential impact to numerous ecological and social factors, such as water, aquifers, traffic and flora and fauna.
Parallel to the COE permitting process, Titan America will begin a two-year process to design and engineer the new plant. The design process could not begin prior to the issuance of the air permit, as the design must correspond to the exact standards outlined by the air permit. The new plant will pioneer the industry's most advanced emission control technologies to ensure that public health, the aquifers, Cape Fear River and Island Creek are protected throughout every step of this process.
When it clears all of the regulatory hurdles, Carolinas Cement will create 161 permanent, full-time jobs. During construction it will create 1000 temporary jobs over two-years.
Lafarge fined over South African cartel 12 March 2012
South Africa: Lafarge Industries SA has admitted taking part in a cement cartel and agreed to pay a US$19.6m penalty. The company reached the settlement with the South African Competition Commission after admitting to having taken part in price fixing and market division in the cement industry. As part of the deal Lafarge agreed to pay the penalty, 6% of its 2010 annual turnover in the Southern African Customs Union (SACU) region, which covers South Africa, Botswana, Lesotho, Swaziland and Namibia.
The case, which has been running since 2008, has investigated dealings at Lafarge, Pretoria Portland Cement (PPC), AfriSam and Natal Portland Cement-Cimpor (NPC-Cimpor). Following a 2009 raid at the offices of the accused parties, PPC applied for leniency and confirmed the existence of a cartel among the four cement producers. In December 2011, an agreement was reached with Afrisam, in which it confirmed the information provided by PPC and agreed to pay a US$16.5m penalty, representing 3% of its 2010 annual turnover in the SACU region.
The commission said that it will continue to investigate NPC-Cimpor.