Global Cement News

India: Adani Group's cement businesses are looking to cut their reliance on distributors and wholesalers as the country's second-largest cement maker looks to boost its profitability. As part of a pilot project, Ambuja Cements and ACC have reduced the number of distributors from 12 to three in the south Gujarat region, which is home to half of the state's small and medium industries and a fifth of the state's population, according to the Mint newspaper. Both firms are expected to reduce the number of distributors across the wider country in the coming months.

"The profitability of the distributors is more than some of the cement manufacturers," said an executive privy to the development. "This needs to change. Once you have fewer distributors, they can continue making more money on volumes, provided they aggressively seek discounts. Both Ambuja and ACC are very strong brands and can do even better if we build an even better engagement with retailers. Additionally, all institutional sales will be done by ACC or Ambuja. So, if there is a large requirement for, say, a flyover project, instead of a wholesaler seeking a bulk order, the cement manufacturer will directly provide to the needs of the contractor."

Adani Group became India's second-biggest cement maker in May 2022 when it paid US$10.5bn to Holcim to buy Ambuja Cements and its subsidiary ACC.

Philippines: The Cement Manufacturers Association of the Philippines (CMAP) is working with the government to attract both domestic and foreign investment to the sector to expand domestic production at low cost. Alongside the Philippine Iron Steel Institute (PISI), CMAP also renewed calls for the promotion of locally produced construction materials with the help of the Department of Trade and Industry (DTI), according to the Manila Bulletin newspaper.

CMAP President Reiner Dizon said “If you buy locally and if there is a problem, it's easy to chase or ask the manufacturer because it's here in the Philippines. Imagine if there is a problem with the cement but it comes from another country, it's quite a complicated process.” Dizon further stressed that enjoying local produce also benefits the economy and fellow Filipinos by creating a circular advantage where profits are shared among the community.

DTI Assistant Secretary Mary Jean Pacheco said that the DTI promotes local construction products and demonstrates confidence that local suppliers provide quality products. Pacheco assured CMAP and PISI that the DTI will strive to advocate standardised products to ensure safety and quality when using construction materials.

Pakistan: Fauji Cement sold 4.9Mt of cement during Pakistan’s 2023 financial year (FY2023), which ended on 30 June 2023. This generated revenues of US$244m, up by 25% year-on-year from US$194m in FY2022. The producer’s earnings before interest, taxation, depreciation and amortisation (EBITDA) also rose, by 29% to US$72.3m from US$56.2m.

Managing director and CEO Qamar Haris Manzoor said “The transformation journey which started in 2020 on capacity enhancement, cost reduction initiatives and increasing captive green energy has now started to pay dividends, despite unpreceded economic challenges.” He continued “FY2023 has been challenging for businesses due to all-time high inflation and interest rates, which saw a drop in consumer demand, negatively affecting the industry. The cement industry saw a demand decline of 16% as construction activities decreased in both the northern and southern regions of the country. Despite the tough environment, Fauji Cement remained committed to its growth strategy, and successfully commissioned its 6500t/day expansion project at its Nizampur site.”

Brazil: InterCement has hired BTG Pactual to help explore ‘capitalisation alternatives’ as part of a proposed restructuring, possibly involving the sale of the group’s Brazilian business. Valor International News has reported that Companhia Siderúrgica Nacional (CSN) Cimentos has signalled its interest in acquiring the business, while Votorantim Cimentos may group together with other cement companies to make a bid. This would entail a division of the assets in order to conform to Brazilian competition laws.

InterCement successfully secured a postponement for payment of its outstanding bank debt in September 2023. It owes net debt of US$1.5bn up to 2027, including a senior note of US$548m due in May 2024. InterCement operates 12.2Mt/yr worth of cement capacity, and produced 8.7Mt of cement in 2022.

Canada: Lafarge Canada has engaged Canadian Utilities on a virtual power purchase agreement (VPPA) basis to supply solar energy for its Exshaw cement plant in Alberta. Under the agreement, the Exshaw cement plant will receive 100% of energy generated at the 38.5MW Empress solar power plant in Cypress County. The VPPA lasts until 2036, and covers 34% of the Exshaw plant’s energy consumption up to that time.

Lafarge Canada (West) president and CEO Brad Kohl said "We're continually assessing ways we can reduce our environmental impact while actively pursuing sustainable solutions within our operations." He concluded "Our collaboration with Atco underscores our commitment to adopting renewable energy at our plants and sites, which is key to reducing our reliance on fossil fuels."