Global Cement News

UK: Hanson UK has announced that it is preparing for a 'tough' 2012. Jon Morrish, managing director, said "We informed employees two weeks ago that we were carrying out a detailed review of the cement business to prepare us for what we expect to be a very tough market in 2012 and beyond."

Morrish's comments arose is the wake of rumours that jobs may be cut at the company's Castle Cement plant in Lancashire. The site currently meets 25% of the UK demand for cement and employs around 300 people. Hanson, a subsidiary of the HeidelbergCement Group, currently runs three plants in the UK including plants in Lincolnshire and Wales, with a workforce of over 1000.

Morrish added, "This review, which includes an assessment of recent changes to the European carbon trading rules, encompasses all three of our cement plants and covers all functions from production and sales to technical and distribution. The three plants are all vitally important to the long term future of the business and there is no intention to close any of them."

"However, it is likely that production levels will change, which will have an impact on jobs. We plan to table outline proposals to employee representatives and recognised trade unions early next week and begin a proper and effective consultation process."

US: Lafarge has reiterated that its expansion and modernisation plan at its Ravena plant in New York State is on track, hitting back at rumours from recently laid-off employees that the company had slowed down or even scrapped its plans to expand the site. 

During a press tour of the site, Lafarge's environmental manager for North America, John Reagan, provided evidence that the project had moved to a pre-construction stage. The US$300m modernisation project underwent nearly three years of permitting with the Final Environmental Impact Statement granted in the summer of 2011. Contractors are dismantling structures at the adjacent Callanan Industry site, so that Lafarge has the room for expansion.

Reagan said that the final design and procurement of materials is ongoing with the construction phase planned from late 2011 to 2014, with start-up planned for mid-2014 and full operation planned for 2015. “2015 seems like a long time from now,” Reagan said, “But it’s not much time to complete all the work that has to be done.” Additionally, the senior project manager, John Light, spoke of the upcoming procurement of heavy equipment including new vertical roller mills.

Over the past few weeks several former Lafarge employees, some of whom were among the 39 laid off on 27 October 2011, have accused the company of everything from not intending to build the new plant to mismanagement. One has accused the company of doing just the bare minimum required to keep the permits valid before closing the plant when the permits expire. 

Lafarge said that it plans to stay in Ravena and that the layoffs and the cut in production were related to the ailing US economy. The plant will soon go to a one-kiln operation, a 50% reduction in capacity. “Demand for cement will determine what capacity we run at,” said Reagan. “We anticipate, based on industry forecasts, that demand will not change much during the next two years."

Tukey: Oyak Cement Group has posted a net profit of Euro73m and a sales revenues of Euro336m in the first nine months of 2011. The group said that domestic cement demand increased by 12% your-on-year in the first half of 2011 and Oyak has reiterated its expectation that domestic cement sales would increase by 8% year-on-year in 2011 as a whole.

The group's Mardin Çimento recorded an earnings before interest, tax, depreciation and amortisation margin of 38.7%, a net income margin of 31.4%, and return on capital of 21.1% over the first nine months. This performance was the strongest of the 15 cement companies listed on the Istanbul Stock Exchange.

France: Lafarge has announced a new organisation project, which aims to make the group more agile and responsive, focused on its markets and its clients and designed to accelerate the group's development and profitability.

The building materials giant, which has major interests in cement, concrete and aggregates, will replace its product line-based
organisational structure with a country-based organisation. This will include the removal of a layer of management and the resulting reorganisation of the Executive Committee.

The project involves three main measures: to implement a country-based organisation, with country CEOs' responsibilities extended to cover all cement, aggregates and concrete activities; removal of one hierarchical layer, with the aim of cutting out the regional level; the resulting transformation of the structure and responsibilities of the Executive Committee, including the creation of 'Performance' and 'Innovation' functions.

The project was described by Lafarge as 'the natural next step' following its geographical expansion and its recent refocusing on 
cement, aggregates and concrete. This has become more pertinent following the disposal of most of its gypsum activities. Its aim is to increase Lafarge's differentiation through the development of higher value-added products and solutions for construction.

Bruno Lafont, Chairman and Chief Executive Officer of Lafarge, said, "This new organisation project will reinforce our efficiency. It will drive us to greater focus on our markets and customers' needs and to 
accelerate the group's development through organic growth and innovation. This transformation is a milestone for the group. It should strengthen Lafarge's position as a key player in sustainable construction." The project will be implemented from January 2012 onwards.

Saudi Arabia: United Cement Company has won the first of three new licenses to set up new cement plants in Saudi Arabia. United Cement's director general, Fahd bin Abdullah Al-Harbi, signed the deal on behalf of his company.The total annual production capacity of the completed plant is not expected to be more than 2Mt/yr.

Sultan bin Jamal Shawly, undersecretary at the ministry for mineral resources, said, "This license is issued as part of the first phase during which two more licenses will be issued to exploit limestone used for Portland and white cement." Shawly added that the license relatedo Hurrat Hadhen in Taif. "We will announce the winners of the second and third licenses on 26 November 2011 at the beginning of the new Hijrah year 1433H," he added. A number of local producers are in the running to secure the two other new licences.

Shawly said that the licenses are being issued with certain conditions that should be strictly followed by the winning company. "One condition is that the (plant operators) should employ and train Saudi workers and the percentage of Saudi workers should be not less than 40% by the end of the first year after starting production," he said. "We have also insisted that the number of Saudi workers in the company should reach 80% after the completion of four years of production."