CemWeek Magazine, Issue 26

GLOBAL CEMENT INDUSTRY. KNOWLEDGE.

APRIL / MAY 2015

26

CW RESEARCH Highlights from

Global Cement Trade Price Report

Decline in global gray cement prices sets trend for the next quarter

feature

VOTORANTIM CIMENTOS Ecoefficiency through technological innovation in the production of artificial pozzolan at Votorantim Cimentos’ Porto Velho plant (RO), Brazil

feature

ASHTRADE EUROPE 2015

feature

SLAG A material that endows cement and concrete with a noteworthy list of advantages

News

•

Analysis

•

A successful event closing the gap between marketers, innovators and traders

Market Coverage

•

Interviews

•

People Moves

CONTENTS FEATURES

3

3 HIGHLIGHTS FROM THE global cement trade price report Decline in global gray cement prices sets trend for the next quarter 7 SLAG A material that endows cement and concrete with a noteworthy list of advantages 13 VOTORANTIM CIMENTOS Ecoefficiency through technological innovation in the production of artificial pozzolan

FEA

17 ASHTRADE EUROPE A successful event closing the gap between marketers, innovators and traders

7

DEPARTMENTS LETTER FROM THE PUBLISHER 1 Global cement trading remains dynamic despite expected price declines numbers in brief 2 Fly ash usage in cement to visibly increase by 2018 research 21 Cement Volumes 24 Cement Energy Markets people 29 People on the move 30 33 35 37

regional reports Europe, Middle East & Africa South-East Asia Asia Pacific Americas

From our industry partner 39 Construction and building materials update equipment 42 Equipment and notable projects cw group meeting agenda 43 Group’s upcoming events BUZZ 44 Top 15 CemWeek and BM Week stories

EDITOR’S NOTE Letter from the publisher and editor

Global cement trading remains dynamic despite expected price declines The new issue of CemWeek magazine brings a host of features and analyses on the essential global trends within the industry. Declining FOB cement prices and their impact on the next quarter, the most relevant topics discussed at the Ash Trade Europe 2015 conference and innovative eco-efficient solutions for the production of pozzolan are among the main areas covered by this issue of CemWeek Magazine.

One of the most important developments of the past months has been the decline in FOB prices, as highlighted by the preliminary figures of the 1Q2015 Global Cement Trade Price Report. Global cement trade prices fell 1.9 percent year-on-year according to report, and with a few exceptions most regions are expected to see varying degrees of price declines in the following months. A comprehensive feature story in this issue of the magazine presents all the details about the past quarter’s trend, which are likely to have an impact on prices over the next few months.

Meanwhile, industry representatives continue to seek opportunities for exchanging ideas that can improve the technical and business approaches for cement production. One such opportunity has been the Ash Trade Europe 2015, an event which closed the gap between marketers, innovators and traders. Industry specialists from over a dozen countries and multiple continents attended the AshTrade Europe 2015 conference on April 22 – 23 in Frankfurt, Germany and saw participation from recognized leaders in the coal combustion byproducts industry, including fly ash, bottom ash, gypsum, shipping, handling, logistics and technology specialists.

This issue of CemWeek magazine provides in depth coverage on the most interesting and compelling ideas exchanged during the event.

Technological innovation continues to be highly valued in the industry, as environmental concerns and efficiency pressures become ever stronger. This issue of CemWeek Magazine features a full story about the production of artificial pozzolan at Votorantim Cimentos’ Porto Velho plant in Brazil. The plant is located in Rondonia State, a strategic area due to the important governmental investment in infrastructure, but also a location where limestone, slag, fly ash or natural pozzolan are in short supply. Therefore, the production of cement with pozzolan from calcinated clay came as the ideal solution from the environmental, technical and the economical points of view. Read the feature to find about the innovations that make such a solution possible.

The current issue of CemWeek Magazine also features a highly informative story about the use of slag in the manufacturing of cement. You will find out interesting facts about how slag is produced and what benefits it provides to cement. Traditionally, Asian markets are the main slag producers and 2014 made no exception to this rule, the region controlling about 73 percent of the total slag production for the year. China accounts for more than half of the world’s total slag production, with a total output of 375 million tons in 2014. The value of the Chinese slag market is expected to reach USD15 billion by 2020. However, increasing demand and restricted supply in the ferrous slag industry is bound to burden the slag cement industry. The environmental legislations and tighter emission controls that China, Japan and European countries have adopted will put the brakes on slag production, affecting the cost and competitiveness of the cement and aggregates industry. Read all about the trends slag manufacturing trends in the current issue of our publication.

And as usual, CemWeek magazine comes with detailed news about the main indicators of the cement industry, including the latest facts and figures about cement volumes, energy prices, and relevant people in the -industry, regional developments, equipment and construction projects. All the details and numbers are laid out in the dedicated sections.

The CemWeek Magazine is published by the CW Group LLC PO Box 5263 Greenwich, CT 06831, USA T: +1-702-866-9474 www.cwgrp.com www.cemweek.com

STAFFBOX ROBERT MADEIRA CEMWEEK PUBLISHER HEAD OF CW GROUP RESEARCH

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CW Group CW Analytics

numbers

Fly ash usage in cement to visibly increase by 2018

The coal combustion by-product is becoming ever more sought after by cement manufacturers, but while supply is not a problem in theory, the reality is that suitable high-quality fly ash will be challenging to source.

Main fly ash producers

Million tons

500 400

200

0

150

China

India

54

40

30

United States

European Union

South Africa

Source: Mexico’s National Institute of Statistics and Geography CW Research

600

Oversupply of fly ash continues to be a daunting issue in highly industrialized regions. China and India are facing environmental problems if fly ash generation is not reduced or if the waste material is not reused. The Indian government is taking steps to increase the usage of fly ash in manufacturing building materials, yet given the low lime content of the majority of Indian fly ashes, the waste has low cementitious and pozzolanic properties, making it difficult to incorporate in construction materials manufacturing.

In 2018, fly ash usage in cement production is estimated to reach 150 million tons worldwide, by 32 percent more than 2014’s 118 million tons utilization rates. The expected growth will mostly be driven by developed markets, such as the country members of the European Union, and by the United States. Asian and Middle Eastern countries, where increased usage of fly ash is only now being regulating as a result of environmental concerns, will contribute by a lower margin to the global increase in fly ash usage.

160

Million tons

120

118

126

141

133

150

80

40

0

2014

2015E

2016E

2017E

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2018E

April / May 2015

Source: Mexico’s National Institute of Statistics and Geography CW Research

Global fly ash usage in cement

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FEATURE

Highlights from Global Cement Trade Price Report Decline in global gray cement prices sets trend for the next quarter

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lobal cement trade prices fell 1.9 percent year-on-year, according to preliminary figures presented in the 1Q2015 Global Cement Trade Price Report (GCTPR). The seasonal adjustment traditional to the period has also affected white cement, clinker and slag trading.

With a few exceptions, most regions are expected to see varying degrees of price declines in the following months.

Lower year-end cement prices and volumes In the fourth quarter of 2014, the GCTPR global gray cement FOB price index fell by US$3.2 per ton, or 4.5 percent QoQ. While FOB prices traded flat in Asia in 4Q2014 (up 0.8 percent QoQ), price depreciation for gray cement was most noticeable in Scandinavia and the Baltics, where prices declined by US$5.0 (-7.7 percent QoQ), and Western Europe, with less international, ocean-bound trade averaged US$88.5 per ton (-7.4 percent YoY). However, bucking the trend, Mediterranean Basin FOB prices for gray cement rose 4.4 percent YoY to US$59.6 per ton.

Global gray cement FOB prices peaked at US$73.4 per ton in July 2014, but took a bit of a beating in the second half of the year

On a monthly basis, gray cement exports volumes weakened towards the end of the year, dropping by 9.1 percent and 7.4 percent MoM in November and December 2014, respectively. In terms of pricing, global average FOB rates for gray cement fell by US$1.9 per ton (-2.8 percent) in December 2014 after trading flat in the previous month.

“Global gray cement FOB prices peaked at US$73.4 per ton in July 2014, but took a bit of a beating in the second half of the year, ending at US$67.5 per ton,” said Robert Madeira, CW Group’s Managing Director & Head of Research.

From a tonnage perspective, gray cement traded volumes for the GCTPR 20-country index of lead reporting countries was down to 9.3 million tons in 4Q2014 from 9.8 million tons in 3Q2014 (-4.3 percent QoQ). The GCTPR currently covers trade prices and volumes for 56 countries.

Notably, exported gray cement volumes in the Mediterranean Basin increased 4.4 percent YoY in 4Q2014 reaching 3.5 million tons. Scandinavia and the Baltics exported 0.7 million tons of gray cement during the quarter, up 18.8 percent YoY. Gray cement prices likely to continue decline The 1Q2015 update to the Global Cement Trade Price Report shows that gray cement FOB prices in Asia Pacific are likely to post slight declines over the period from March to June 2015. “Exporting cement is becoming more competitive and markets www.cemweek.com

are looking to import increasing amounts of cement. Meanwhile, exporters are reducing prices to gain a competitive advantage,” said Prashant Singh, Associate Director with the CW Research team.

While China is expected to keep cement prices stable and Thailand is looking at an increase in FOB rates owing to improving demand, India and Malaysia will experience depressed prices. By June 2015, cement prices in India are expected to fall 2.7 percent as compared to December 2013, and after a 12.6 percent month-on-month decline registered in December 2014, MaApril / May 2015

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FEATURE

laysia’s FOB prices for gray cement will likely post reduced negative monthly variations.

As for the Western and Northern Europe, the most notable contraction is set to be posted by Latvia, where gray cement export prices are likely to drop approximately 17 percent by June 2015 as compared to December 2014. Minor declines are expected to occur in Sweden, Lithuania, Austria, Scandinavian and Baltic countries, while major exporters Denmark, Belgium and Germany are looking at a small price gain.

Countries in the Mediterranean Basin too are forecasted to experience an overall decline in FOB prices for gray cement, given the increasing competition for import markets. Turkish FOB prices are expected to stay below the USD 55 per ton mark, while prices in Spain are likely to revolve around USD 72 per ton in the period to June 2015. Iran, the main exporter in the Middle East, is expected to post slight monthly price variations.

The exception for the next quarter appears to be North America and the Caribbean.

Starting from February 2015, FOB prices for gray cement in the region are set to maintain a positive trend, given the revival of the cement sector, with month-on month FOB price growth below 2 percent.

Slag, clinker and white cement also declining Similarly to grey cement, FOB price decreases also impacted slag, clinker and white cement, by 16.8 percent, 1.9 percent and 3.3 percent QoQ, respectively.

Volumes of exported slag tumbled by 8.4 percent QoQ to 3.7 million tons in 4Q2014 (the countries in the reporting set for 4Q2014 represented 69 percent of global trade vs 3Q2014). Clinker exported volumes decreased by 1.9 percent QoQ to 6.0 million tons in 4Q2014 (volume traded by the reporting countries during the quarter accounted to 62 percent of global slag trade vs 3Q2014).

“To provide a complete view of cement prices, we include also in the GCTPR ex-works and what we call “market prices,” not only import and export price. As a highlight, we saw ex-works prices in the majority of countries we track struggling in the quarter.

There were however some notable exceptions such as the US (+4.9 percent), China (+3.5 percent) and South Africa (+5.3 percent). In South Africa, the highest ex-works prices for the entire year were seen in 4Q2014,” said Prashant Singh, Associate Director at CW Research.

Notably, retail prices in the US and the UK markets have stabilized, aided by the

rebound of the construction sector, while in Latin America price volatility has been more notable. Mexico, for instance saw prices increasing by 1.3 percent, and Colombia experienced a decrease of 2.4 percent.

Higher trade activity expected Trade dynamics during the first quarter of 2015 have seen some new developments, as Asian exports continued to grow while African countries have been trying to reduce imports by increasing local production. In Europe, the situation is mixed, with lower consumption expectations in some Eastern European countries and expanding figures in Western Europe, while South and Central American countries are opening up to imports in order to support the higher demand.

Several Asian countries are expected to export more cement this year. Indonesian companies are considering a focus on exports if local demand continues to decline as a result of the rainy season and the delays in government infrastructure spending. Vietnam also anticipates an increase in cement and clinker exports after the country’s exports in 2014 reached 21.1 million tons, up from approximately 20 million tons in 2013. Pakistan, a major player in the region, is also looking at higher sales

Source: CW Research

Global Gray Cement FOB Average (USD/Ton)

5

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Clinker Exports

Source: CW Research

Global Cement Trade Price Report - GCTPR

abroad this year, after exports in the first quarter of the fiscal year rose by 4 percent QoQ. A similar situation is developing in other regions as well. Saudi Arabia is likely to resume cement exports, as companies have asked the government to lift the threeyear-old export ban. They are seeking to supply Egypt with 6 million tons of cement, and Qatar, which will be building stadiums and other sport facilities for the 2022 World Cup. In Europe, foreign producers are targeting Russia as a possible export destination. Armenia and Belarus are planning to supply the building materials, after the signing of several contracts with Russian companies. Belarusian cement manufacturers will export 2 million tons of cement to Russia this year under a contract with Russian company Eurocement. However, that will not offset the decline in Russian cement imports in the first quarter of the year, estimated at 82 percent.

On a different note, several African countries are trying to reduce their dependence on expensive imports by supporting local production. In Congo, the Export-Import Bank of India extended a credit to the national authorities for a 600 tons-per-day rotary Greenfield kiln cement plant. In

Kenya, National Cement will commission a clinker plant which is expected to reduce national import costs by USD 100 million per year. In Algeria, government intervention in the cement market is affecting trade relations with Vietnam, Pakistan, and Turkey in a move to prevent the use of imported building materials.

In the Americas region, improved demand is leading to increasing imports. One of the most noticeable spike occurred in Bolivia, which purchased foreign cement worth USD 5 million in January 2015, 69 percent higher than in the same month of 2014.

Last year, Peru was the biggest supplier for the Bolivian market, accounting for 59 percent of Bolivia’s cement imports, valued at USD 21 million. Brazil and South Korea are other major exporters to Bolivia.

More detailed information and analyses down to country level are available in the latest update to the Global Cement Trade Price Report, a benchmark price assessment for monthly worldwide gray cement, white cement, clinker and slag trade, exworks and effective market prices. The Report is published by CW Research, the research desk of global industry advisory and analysis boutique CW Group, based in Greenwich, CT USA. www.cemweek.com

The Global Cement Trade Price Report (GCTPR) is the source for cement and clinker prices, as well as for market information for most regions worldwide. This extensive quarterly report includes current pricing in comparable units for cement and clinker traded internationally through imports and exports, and compares price trends in five continents.

The Global Cement Trade Price Report, the source for global cement and clinker price data. Each report is approximately 80 pages in length and includes gray cement, white cement and clinker import and export prices from all major regions of the world.

The key factor determining a cement trader’s global price competitive position remains its pricing strategy. This applied to vertically integrated cement traders, independent traders, shippers as well as buyers.

Timely knowledge of global cement prices and trends remains a cornerstone for competent internal strategic planning within the cement industry. Join a global group of international cement companies, analysts and others in subscribing to the only publication that consistently tracks cement trade prices.

For questions, inquiries and orders please contact your CW Group Client Service Coordinator or sales@cwgrp. com .

For a complete table of contents of the report, please visit the CW Research website: http://research.cwgrp.com .

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FEATURE

Slag has been employed in cement manufacturing since the 19th century, today being universally accepted as a material that endows cement and concrete with a noteworthy list of advantages. Given that this waste is highly dependent on steel and iron output, both of which are subject to the fluctuations of the macro-economic indicators, cement manufacturers are challenged in finding slag resources.

7

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FEATURE

last-furnace slag is the non-metallic product produced at the same time with iron in the last furnace, consisting primarily of silica and alumina from the iron ore, combined with calcium and magnesium oxides from flux materials. For an ore feed grading 60 percent to 606 percent iron, about 0.25 to 0.3 tons of blast furnace slag are produced per ton of crude iron. Steel slag, on the other hand, is a by-product of steel making, produced during the separation of molten steel from impurities in steel-making furnaces. Occurring as a molten liquid, this type of slag is a complex solution of silicates and oxides that solidifies upon cooling. There are several types of steel slag produced during steel making, namely furnace or tap slag, raker slag, synthetic or ladle slag and pit or clean out slag. Furnace steel slag output is approximatively 20 percent of the mass of the crude steel output, or about 0.2 tons of slag per ton of crude steel.

Why slag is fitted in cement production?

Both types of slag are used in cement manufacturing, road and railway construction,

9

April / May 2015

Steel slag is a by-product of steel making, produced during the separation of molten steel from impurities in steel-making furnaces soil improvement, concrete, building construction, recycling or used as fertilizers.

Using blast furnace slag in cement manufacturing comes with a long list of benefits that has not escaped the eye of cement producers around the world. Among the measurable improvements are better concrete workability, higher compressive and flexural strengths, easier finishability, lower permeability, more consistent plastic and hardened characteristics and better resistance to aggressive chemicals. The waste is used in the production of cement or of cementitious materials in two ways: as a raw material incorporated in the manufacturing of Portland cement, and in com-

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bination with hydrated lime, gypsum and anhydrite in its glassy ground form. In the former case, the slag furnished silica, alumina, magnesia and part of the lime are required, helping in reducing fuel consumption in the kiln due to the burning of lime from the slag and not from the limestone (smaller amounts of calcium carbonate have to be calcined to remove the carbon dioxide). Ease of handling and the rapidity of reactions between the glassy form of slag and other raw materials make granulated and glassy slags the most used ones.

There are several factors determining the performance of a slag in Portland blastfurnace slag cement. On the one hand, the

chemical composition of the slag has to be taken into consideration. As a rule of thumb, the more basic the chemical make-up of the slag is, the better will its cementitious properties be. Nonetheless, high glass content is desirable. Fineness of the grind is also highly important, as it determines the rate of reaction, while the amount of slag used in the blend will determine the magnitude of modification of the cement’s characteristics.

The more basic the chemical make-up of the slag is, the better will its cementitious properties be

Slag global market With more and more cement manufacturers looking to incorporate the valuable waste in cement manufacturing, it is sen-

sible to understand how the steel and iron blast furnace slag markets have evolved over the year.

Steel slag and iron blast furnace slag production

2004

2005

2006

2007

Iron blast furnace slag

2008

2009

2010

2011

2012

2013

2014

Source: CW Research

Steel slag

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Both commodities have been affected by the weak global economy of 2008, which took its toll on manufacturing industries, the steel and iron ones included. As such, 528 million tons of steel and slag were produced in 2009, with 20 million tons less than in the previous year. Slag output rebounded to 597 million tons in 2010, growing to 680 million tons in 2013. In the following year, volumes increased by only 1 million ton to 681 million tons, out of which 327.4 was steel slag and 353.9 iron blast furnace slag.

Traditionally, Asian markets are the main slag producers and 2014 made no exception to this rule, the region controlling April / May 2015

10

FEATURE

about 73 percent of the total slag production for the year. China accounts for more than half of the world’s total slag production, having produced 375 million tons of the commodity in 2014. The value of the Chinese slag market is expected to reach USD15 billion by 2020. Japan follows with a slag output of 47 million tons coming from its flourishing steel production, followed by South Korea and India, both having produced about 30 million tons of slag.

Russia’s and US’ production levels stood under 30 million tons, while Germany, Brazil and Turkey each had an output of less than 20 million tons of slag for 2014.

The total slag output for the above mentioned countries represents 85.63 percent of the global slag production for 2014.

Global slag consumption in cement has remained rather subdued over the past 10 years, despite of the high performance of the material. Only in 2007 and in 2008 did the percent of slag out of total slag output reached 8 percent usage in cement, remaining around 6-7 percent in the rest of the years. In 2014, 46.7 million tons of slag have been used globally in manufacturing cement, with only half a million ton more than during the previous year.

High utilization rates surface in Europe, where 15.1 million tons of slag were used in cement manufacturing, followed by South America, where 9.3 million tons of slag were incorporated in producing the commodity. China and India both con-

We believe that Japanese slag will hardly be available on the open market due to the merger and rationalization of Sumitomo and NCS, post-tsunami reconstruction and the 2020 Olympics

Usage of slag in cement 0.7% 0.3%

Asia

5.4%

Europe

17.3%

North America 72.6%

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South America

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Source: CW Research

0.9% 2.7%

sumed about 6 million tons of slag in cement production, while North America only used 0.8 million tons of slag. Middle East and Africa slag consumption in cement industry is only 0.3 percent of the global slag production. Nevertheless, given that the two regions are suffering from a growing pile of slag waste, discussions are underway between several interested government agencies and the construction industry over greater use of slag in cement production.

In 2014, slag exports saw shrinking in vol-

will hardly be available on the open market due to the merger and rationalization of Sumitomo and NCS, post-tsunami reconstruction and the 2020 Olympics to be held in Japan. Japan controlled almost 50 percent of the total amount of slag exported in 2014.

Usage of slag in cement slag used in cement production

% of slag used in cement production out of total slag output

55

9%

45

25

3%

15 5

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

0%

Source: CW Research

6%

35

India, South Korea and Russia could be potential slag suppliers for the cement sector umes owing to increased domestic use of slag and due to the slightly lower production rates for the commodity. Japan produced 110.7 million tons of steel in 2014, yielding 47.3 million tons of slag, out of which 11 million tons were exported. Germany, with steady production levels of 42.9 million tons of steel, had an output of 16.9 million tons of slag, and exported only 1.2

million tons of the commodity, while Italy exported a similar amount though it produced only 4.7 million tons of slag.

CW Research finds that these top exporting countries will lower volumes in 2015.

Their combined exports will reach 12.1 million tons, by almost 2 million tons less than in 2014. We believe that Japanese slag

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Other countries might also add to the global supply given the increasing demand for the commodity. India, South Korea and Russia, all of which had a granulated slag output of around 25 million tons each in 2014, could be potential slag suppliers for the cement sector. The United States, which had a slag production of 25.4 million tons, did not use more than 0.6 tons domestically in manufacturing cement, exporting the largest share of its production to Canada, Colombia and Mexico.

The outcome of increasing demand and restricted supply in the ferrous slag industry is bound to burden the slag cement industry. The environmental legislations and tighter emission controls that China, Japan and European countries have adopted will put the brakes on slag production, affecting the cost and competitiveness of the cement and aggregates industry.

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FEATURE

Ecoefficiency through technological innovation in the production of artificial pozzolan at Votorantim Cimentos’ Porto Velho plant (RO), Brazil José Eustáquio Machado & Silvia Regina S S Vieira

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FEATURE

Introduction The Porto Velho cement plant is located in Rondonia State, in the Northwest of Brazil.

It was designed for supplying cement to the North region of Brazil and, particularly, Santo Antonio and Jirau hydroelectric power plants that are under construction in the middle of Amazon region.

If on one hand the location of Porto Velho is strategic because the region concentrates important governmental investment in infrastructure, it is, on the other hand, unfavorable for a cement plant due to the lack of limestone, which is an essential raw material for clinker production. As a result, the plant has to operate with clinker transferred from other units, which means increasing operational costs. Thus, it is imperative to produce a cement with the lowest clinker content as possible.

However, there are no sources of slag, fly ash or natural pozzolan in the area, which could be used not only to decrease the clinker factor, but also to produce cement that would comply with the requirements of the infrastructure works.

Therefore, the production of cement with pozzolan from calcined clay came as the

In comparison with clinker production, the production of artificial pozzolan from calcined clay is simpler ideal solution from environmental, technical and economical point of view.

Porto Velho cement plant The Porto Velho cement plant represents an investment of 176 million reais and during its construction were employed 1.6 million man/hours.

The Porto Velho industrial complex started operations in 2009. It consists of a pozzolan kiln and a grinding system. The rotary kiln is 89 meters long, has a diameter of 3,95 meters and nominal production capacity of 1000 tpd. Its average thermal and power consumptions are 490 kcal/kg and 25 kwh/t, respectively. The kiln was designed and specified by Votorantim Cimentos and manufactured by FL Smidth.

The plant has production capacity of

700.000 tpa and nowadays is manufacturing cement type IV (according to Brazilian and European standards), which are sold in bulk and bags.

Production of artificial pozzolan In comparison with clinker production, the production of artificial pozzolan from calcined clay is simpler. The pozzolan kiln can be fed with coarse material, with a moisture content up to 30 per cent. The pozzolan kiln works as a dryer and a calciner. The process gas is extracted with a single fan and is cooled with atmospheric air only. Satellite coolers are normally used, due to the granulometry of the calcined clay.

The artificial pozzolan is obtained by the calcination of kaolinitic clays, at temperatures ranging from 800째C to 950째C. This process results in the dehydroxylation of the clay and modification of its crystalline structure, with formation of metakaolin, which is an amorphous, metastable phase.

When finely ground and in presence of water and calcium hydroxide, the metakaolin reacts, producing compounds similar to those produced by the hydration of cement.

Benefits associated to the production and use of artificial pozzolan The benefits related to the use of calcined clay as clinker replacement are manifolds.

Comparing to the clinker production process, the thermal and electric energy required for the calcination of clay is around 10 per cent and 25 per cent lower, respectively. There is also a reduction of about 40 per cent of the process water and a decrease of 43 per cent of the CO2 emissions.

From the technical point of view, the use

15 April / May 2015

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of pozzolan allows manufacturing of a cement with lower heat of hydration and enhanced resistance to chemical attacks, which are characteristics normally required for the construction of dams. The pozolanic reaction that occurs during the cement hydration densifies the microstructure of the cement paste, increasing gradually its mechanical strength.

Specifically in the case of Porto Velho plant, its location near to the main costumers, that is, Jirau and Santo Antonio dams, also promote a reduction of emissions related to transport of the cement to the jobsites.

Conclusion The Porto Velho plant materializes VC commitment to more ecological processes and products with lower environmental footprint that fulfill the most demanding customers´ requirements. It also demonstrates Votorantim´s technical expertise, which is the result of long-term investment in in-house research and development.

The pozolanic reaction that occurs during the cement hydration densifies the microstructure of the cement paste, increasing gradually its mechanical strength Benefits related to the production of artificial pozzolan at Porto Velho cement plant Electric energy

Thermal energy

Water

CO2 emissions

-10

-25

-40

-43

% of reduction associated to the process of production of pozzolan in comparison with clinker production

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FEATURE

a successful event closing the gap between marketers, innovators and traders

Fostering a focused approach to the coal combustion by-product sector, AshTrade Europe once again proved its value in bringing together international industry professionals who are keen in sharing key perspectives and global practices.

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ostering a focused approach to the coal combustion by-product sector, AshTraade Europe once again proved its value in bringing together international industry professionals who are keen in sharing key perspectives and global practices.

Industry specialists from over a dozen countries and several continents attended the AshTrade Europe 2015 conference on April 22 – 23 in Frankfurt, Germany and saw participation from recognized leaders in the coal combustion byproducts industry, including fly ash, bottom ash, gypsum, shipping, handling, logistics and technology specialists.

The vast regional representation aided in exchanging different understandings of the industry and cutting edge information, creating new business partnerships, as well as triggering general discussions on the future market trends and challenges the ash, cement and concrete industry will face on the long and short term.

The Ash Trade Europe event organized by GMI Global focused on business developments, trading, shipping and logistics, technical developments and innovations, power generation, fly ash trading, bulk

The audience of traders, fly-ash marketers, end users, equipment suppliers and academicals involved in fly ash research, represented the industry’s full value chain handling and concrete ready-mix. The audience of traders, fly-ash marketers, end users, equipment suppliers and academicals involved in fly ash research, represented the industry’s full value chain.

The conference speakers offered the attendees a new perspective on Fly-Ash, in the context of similar industry events.

Their presentations targeted an extremely complex array of Fly-Ash related developments, adding even more value to the event itself.

Some of the highlights from the conference include a new perspective on fly - ash and its uses, as a building material. This overview comprised a classification of flyash according to three main attributes:

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permeability, fineness and water requirement, stressing the progress achieved in fly - ash processing and activation. As a result of processing developments, speakers defined a new concrete product, HPC (High Performance Concrete), reportedly having three essential properties: high workability, high strength and high durability.

Mr. Georg Dirk, ex-chairman of Dirk India, shared his lifetime experience in sustaining the use of fly ash in cementitious applications. After briefly walking the audience through the history of how fly ash became a valuable waste, he followed with astute observations on the Indian oversupply of fly ash and on the means this burden could be lessened by incorporating more fly ash in manufacturing cement and

April / May 2015

18

FEATURE

cementations products. Mr. Dirk stressed his concern on the reluctance of Indian cement manufacturers in using coal waste in their products, underlining the dangers of a future scenario in India where fly ash usage remains subdued.

Financial and economic aspects of the Gypsum study were also interesting points of the conference, covering topics like: gypsum processing industry markets for gypsum products until 2030 (e.g. plasterboard, cement), gypsum supply (status quo), natural gypsum deposits, FGD gypsum supply, gypsum recycling, future supply scenarios for the gypsum processing and cement industry until 2030 and of utmost importance, scenarios of costs and benefits. Mr. Holger Alwast, Head of Waste & Secondary Resources at Prognos delivered a presentation on an a report Prognos is preparing to launch on the supply of gypsum and the influence of the energy turnaround in Europe. Mr. Holger Alwast stressed that renewable energy sources will gain more territory in Europe to the detriment of coal, lignite, nuclear and gas generated power, anticipating that steam coal usage will drop by as much as 65 percent by 2030 in the EU 28 countries.

Mr. Dirk stressed his concern on the reluctance of Indian cement manufacturers in using coal waste in their products, underlining the dangers of a future scenario in India where fly ash usage remains subdued Transport and logistics solutions were offered by representatives of the Cement Carriers industry. The attendees were given insight into the process of adapting an existing cement carrier fleet to a viable and profitable fly ash transport solution. Some of the presented advantages of such innovation impacted the users both financially and environmentally by minimizing stevedoring costs and investments in shore equipment, minimizing air pollution and noise free discharging operations. Fly-ash transportation was the main point of focus for the audience during the presentation held by Mr. Dimitris Georgantis, Chartering Broker at Howe Robinson Shipbrokers, especially for the traders taking part in the conference, who were eager to find more details on the company’s existing fleet, and on whether cement carriers could also function as fly ash carriers.

19 April / May 2015

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terials evolve over the upcoming year.

The academically presence of the conference was marked also by Ms. Ioanna Papayianni, Director of Laboratory of Building Materials at the Aristotle University of Thessaloniki on calcareous fly ash and its underrated usage in the building materials industry. Ms. Papayianni highlighted that even if it is less consistent than other types of ashes, calcareous ash, which is widely available in Greece, Bulgaria and Romania, can add more strength to concrete, while reducing costs by as much as 16 percent.

New equipment designed to process fly ash to reach quality aspects, by separating coarse and unburned particles from the fly ash. The speakers thoroughly presented the principal of separation used by the equipment and the resulted products, estimating a high percentage of obtained product amount. The attendees were provided with a Test Machine demonstration, with duration of 30 minutes and the results were compliant with the initial estimation. Further steps taken into account included installation of a processing plant with 10 t/h for continuously operation.

Mr. Jens Garbe, Territory Sales Manager at Claudius Peters, highlighted the company’s new piece of equipment for fly ash separation, meant to improve the quality of fly ash by reducing the high content of unwanted carbon. Mr. Jens Garbe expressed his confidence that the Claudius Peters equipment will become a valuable feature in cement plants that intend to use high quality fly ash. The talk triggered a Q&A session on how this piece of equipment is being tested and on its success rate.

and Estonian power plants, Ms. Koroljova presented how this waste can be reused in a cost effective way by employing it as a binder in road construction.

AshTrade Europe meeting continued with a presentation delivered by Ms. Aino Heikkinen-Mustonen and Mr. Petter Londen from Fatec on modular high recovery fly ash processing unit. The interactive presentation highlighted the work of 40 years of Ms. Aino Heikkenen-Mustonen, whose research lead to the development of a flyash based product able to replace cement in a 20 percent ratio, which comes with economic and ecological benefits.

A global outlook on the cement sector and on the usage of raw materials in the industry was presented by Mrs. Raluca Cercel, analyst within the CW Group, who emphasized how the research group sees cement demand, usage and costs of raw ma-

The event ended with a lively panel discussion with Mr. Georg Dirk, Mr. Dimitris Georgantis and Mr. Holger Alwast covering the challenges and opportunities in the by-product and cement industry, as well as other specific market related topics, such as trading, logistics and forecasts.

The AshTrade series will continue this year with two major events: AshTrade India, taking place in Mumbai, India, on September 4, 2015 and Slag & AshTrade Americas, hosted in Rio de Janeiro, Brazil, on September, 30 and October 1, 2015. AshTrade India will focus on Fly-Ash related developments and impact on the industry and will offer various solutions and new perspectives to Fly-ash producers, Flyash-product users, cement producers and users, equipment vendors, traders and shippers, fly-ash marketers, bulk handling professionals, constructors and ready-mix producers, as well as essential networking opportunities.

Ms. Arina Koroljova, Project Manager at Eesti Energia, delivered a talk on the usage of burnt oil shale as a binding material in road construction. Underlining that as much as 6 million tons of oil shale are deposited at the ash plateaus of the Baltic

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April / May 2015

20

CEMENT MARKETS

CW Research

CEMENT VOLUMES Saudi Arabia’s construction sector is likely to grow at a 10 percent rate this year, which will further boost demand for cement.

Demand for cement in Saudi Arabia grew in March 2015 at an even steeper rate than in the previous month. While posting a 10 percent year-on-year increase in February, cement consumption in the Emirate expanded by 12.4 percent to reach 5.81 million tons in March. This sustained growth was largely influenced by Saudi Arabia’s ongoing efforts to boost long-term non-oil development through focused investment programs, with an emphasis on roads and highways. Saudi Arabia’s construction sector is likely to grow at a 10 percent rate this year, which will further boost demand for cement. In line with consumption growth, production of the building material also saw a consistent boost in March 2015, with volumes growing by 12.9 percent with respect to the previous year.

Spain has also exhibited a steady cement demand growth in March as the country is seeing slight, but steady recovery after the economic crisis. Cement consumption rose 5 percent in March as compared to the same month last year, after having increased by 4.8 percent year-on-year in the previous month.

Yearly cement demand growth in Pakistan is slowing, slowing from an 11.4 percent year-on-year increase achieved in January to 3.9 percent in March. The improvement in macroeconomic environment in the country is likely to fuel local demand of cement to grow further. The private sector housing schemes are currently the major driving factor in cement local demand.

March 2015 Year-on-Year Cement Demand Growth (%) 15% 10%

21 April / May 2015

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France

Indonesia

Morocco

Poland

Ecuador

Germany

Pakistan

To learn more, please contact the CW Research team at sales@cwgrp.com or +1-702-430-1748.

Source: CW Research

-10%

Cyprus

-5%

Spain

0%

Saudi Arabia

5%

CW Research CEMENT MARKETS

In Germany, cement consumption grew by 1.8 percent year-on-year after having posted double-digit declines in January and February. These declines were unexpected as the country is experiencing continuing high demand for new housing. Demand for cement is likely to grow this year by 1 percent.

While Polish cement consumption levels expanded by 0.5 percent year-on-year in March, production volumes were lower as compared to the similar month in 2014. The construction sector is forecasted to grow at an 8 percent rate this year, which will likely cause demand for cement to grow further in the coming months.

Indonesia saw one of the steepest declines in terms of year-on-year change in cement consumption, with volumes falling by 5.8 percent in March. If infrastructure executions fall short of expectations in 2015, the consumption growth estimated by the Indonesia Cement Association for 2015, namely 5 to 6 percent, will most likely not be met.

In Germany, cement consumption grew by 1.8 percent yearon-year after having posted double-digit declines in January and February.

March 2015 Year-on-Year Cement Production Growth (%) 20%

Cyprus

China

-30%

Source: CW Research

-20%

Poland

-10%

Belarus

0%

Saudi Arabia

10%

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April / May 2015

22

MARKET DATA SNAPSJOT

CW Research

Volume variation analysis for selected countries that are major consumers, producer, importers and exporters of cement. This is a selection of notable markets. Additional detail is available from CW Research as well as on-line at http://www.cemweek.com to the market data section.

Cement Production (million tons)

Cement Consumption (million tons)

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

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Cement Production MoM (%)

Cement Consumption MoM (%)

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

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WWW.CEMWEEK.COM/SUBSCRIBE

Cement Exports (million tons)

Cement Imports (million tons)

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

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WWW.CEMWEEK.COM/SUBSCRIBE

Cement Exports MoM (%)

Cement Imports MoM (%)

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

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Source: CW Group analysis estimates

MoM: month vs previous month; YoY: month vs same month last year; YTD: year-to-date; YTD%: year-to-date vs previous year

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23 April / May 2015

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CEMENT ENERGY MARKETS

CW Research

CEMENT ENERGY MARKETS Coal Market Update Global coal trading volumes increased remained almost unchanged in February 2015 declining -0.3 percent in comparison to January 2015. Significant recovery in coal trading volumes was observed in Indonesia and Colombia, with declines recorded in Australia, South Africa, and the United States.

Indonesian coal deliveries increased 10 percent from January to reach an estimated 33 million tons, up 17 percent when compared to February 2015. Indonesian Coal Mining Association (APBI) has advised the Indonesian government to cap coal production at 400 million tons and reduce exports to 300 million tons in 2015. This would represent a reduction of 25 million tons in production and 10 % reduction in overall export volumes.

The APBI had initially recommended the government to reduce production by 50 million tons by year-end but conceded that it might be a bridge to far to cross. The country is looking to increase its income from the sector by raising the royalties for companies that hold mining business permits. Under the proposed increase, coal with a calorific content between 5,100 kilocalories per kilogram (kcal/kg) and 6,100 kcal/kg will see a 9% royalty fee, up from 5% at present. Coal with more than 6,100 kcal/kg calorific content, will be charged with a 13.5% royalty fee, up from 7%.

After dropping to an 8-month low in November 2014, Colombian coal deliveries recovered in December and grew 64 percent to 8.4 million tons. Total exported during 2014 amounted 84 million tons, 12.6 million more than 2013.

In light of the proposed hike, it is conceivable that the government may adjust its coal production target to 455 million tons in 2015 in an effort to collect more state income and thereby maintaining the pressure on global coal prices in the months ahead.

In the US, coal deliveries once again declined from January’s 7.1 million tons by 16 percent to 6.0 million tons. Continuing discussion and proposed legislation that could increase royalties and result in more stringent regulations to reduce environmental impact have had added to the gloom in the market. Furthermore, with natural gas prices so low, there is continued preference for natural gas versus coal for electricity generation.

Russia’s saw coal exports decline by 2 percent month on month to reach 14.9 million tons in February. Exports continue to remain strong while domestic consumption remains Coal Global Trading (million tons) Indonesia

120

Australia

Russia

South Africa

Colombia

US

Rest

100

40

Feb-15

Jan-15

Dec-14

Oct-14

Nov-14

Sep-14

Jul-14

Aug-14

Jun-14

Apr-14

May-14

Feb-14

Mar-14

Jan-14

Dec-13

Oct-13

Nov-13

Sep-13

Jul-13

Aug-13

Jun-13

Apr-13

May-13

Feb-13

Mar-13

Dec-12

Jan-13

Oct-12

Nov-12

Sep-12

Jul-12

Aug-12

Jun-12

Apr-12

May-12

Feb-12

Mar-12

Dec-11

0

Jan-12

20

Source: customs data

80 60

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April / May 2015

24

CEMENT ENERGY MARKETS

CW Research

Energy Prices Update Coal The average price for February 2015 closed at US$66 per ton, down less than half a dollar month on month and down 26 percent from February 2013. The thermal coal market faces declining demand from China and a challenging scenario within the production community created by reduced operating costs and rising efficiency to create further imbalance between supply and demand.

The European thermal coal sector has been plagued by persistent decline especially since the fall of 2012. The continued mild winter across the continent in February has sapped demand for the commodity.

The European thermal coal sector has been plagued by persistent decline especially since the fall of 2012. The continued mild winter across the continent in February has sapped demand for the commodity. Prices also declined due to talk of a European utility company that was seeking to offload some of its thermal coal stockpile.

In China, the government has decided to lower both on-grid and retail thermal power tariffs applicable the second quarter 2015 with immediate effect. Although, this policy was decided in December 2012, it was not officially implement even though it was on the books. In fact, the government had reduced these tariffs twice in 2013 and 2014 as an incentive for coal based power producers to adopt more environmentally friendly technology. This implementation will have an impact on the profit of thermal power generating companies and grid operators.

India, which is a major coal consumer second only to China, witnessed a decline in imports. This is due depreciation in value of the Indian rupee which is threatening to affect the affordability of coal imports. Even though India’s domestic production of coal has been impaired by the inability of Coal India, the country’s largest producer of coal,

Steam Coal Fob Average Prices (Us$/Ton) US exported

Colombia exported

Australia Newcastle

Indonesian HBA

South Africa Richards Bay

130 110 90

Jan-15

Nov-14

Sep-14

Jul-14

May-14

Mar-14

Jan-14

Nov-13

Sep-13

Jul-13

May-13

Mar-13

Jan-13

Nov-12

Sep-12

Jul-12

May-12

Mar-12

Jan-12

Nov-11

Sep-11

Jul-11

May-11

Mar-11

50

Jan-11

70

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25 April / May 2015

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Sources: EIA, Colombia Ministry of Mines and Energy, IMF, Indonesia Ministry of Energy and Mineral Resouces

150

to meet production targets, there is a renewed optimism because of the coal auctions that domestic production could witness significant increase with the participation of private sector firms. This is likely to further impact international coal prices going forward.

CEMENT ENERGY MARKETS

CW Research

Colombia, one of the world’s biggest producer or coal is a key supplier to the European market.

Colombia, one of the world’s biggest producer or coal is a key supplier to the European market. However, enforcement of environmental regulations has forced several mining companies to halt production because of their inability to comply with the new regulations for port operations. Drummond, which produces almost a third of the country’s coal, is not expected to resume coal shipments before the end of March.

US Petcoke Export Price (US$/ton) Monthly price 100 80 60

Petcoke Indian petcoke users are continue to show strong interest in high sulfur petcoke as freight rates continued to decline. Western Indian based traders said that there was interest for offers for Panamax vessels of US petcoke with 6.5% sulfur at around $77-78/mt CFR India. This increasing demand is also being reflected in terms of interest from Eastern India based traders with demand set to increase if US petcoke prices with 6-7% sulfur are at sub-$75/mt CFR levels. Discussions with a number of India-based traders spoke about the possibility of imported petcoke possibly replacing Richards Bay 6,000 kcal/kg NAR thermal coal.

Higher sulfur content petcoke has been received with enthusiasm by the industry with several industries including power generation, using it in newer boilers that are capable of burning various fuel grades.

F-15

J-15

D-14

N-14

O-14

S-14

A-14

J-14

J-14

M-14

A-14

M-14

F-14

J-14

D-13

N-13

O-13

S-13

A-13

J-13

J-13

M-13

A-13

M-13

0

F-13

20

Source: customs data

40

India based traders with demand set to increase if US petcoke prices with 6-7% sulfur are at sub-$75/mt CFR levels.

US petcoke export prices declined again in February to $64.97, a 5 percent decline month-on-month. The market remains unable to find equilibrium as substitute products like thermal coal export prices from major producers continue to fall.

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April / May 2015

26

CEMENT ENERGY MARKETS

CW Research

Natural Gas The Henry Hub spot price traded at $2.87 per MMBtu in February, decreasing by 4 percent month on month due to limited demand for heating fuel. According to EIA, natural gas storage was down to 219 billion cubic feet vs. an expected 241 billion cubic feet. Total stocks of natural gas in February 2015 were 1.94 trillion cubic feet compared to 1.36 trillion cubic feet for the same period one year ago. This is an increase of 43 percent and a clear bellwether of oversupply. It is expected with winter receding soon, that natural gas prices will decline.

Despite above-normal temperatures to start the winter, concerns are rising about the natural gas supply in the UK .

Prices in Europe stayed at $8.27 per MMBtu in February, the same level as the previous month. There are growing concerns that continued tensions between Ukraine and Russia will have a spillover effect on natural gas prices in the EU. Presently, the EU gets almost 30 percent of its natural gas from Russia and prices could rise if EU continues to press Russia over its actions in Eastern Ukraine.

The amount of natural gas at the UK’s short- and medium term storage facilities fell below the 2014 levels in the first half of the month because of heavy withdrawals due to Norwegian supplier outages and increased UK demand.

The amount of natural gas in storage facilities in the first week of February was 694 million cubic meters, below the 2014 low on March 28 of 696 million cubic meters. Storage withdrawals have been higher in 2015 compared to previous years because of high gas demand and reduced imports from Norway.

Natural Gas Prices (US$/MMBtu) US

Europe

16 12

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27 April / May 2015

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Feb-15

Jun-14

Oct-13

Feb-13

Jun-12

Oct-11

Feb-11

Jun-10

Oct-09

Feb-09

Jun-08

Oct-07

Feb-07

Jun-06

Oct-05

Feb-05

Jun-04

Oct-03

Feb-03

Jun-02

Oct-01

Feb-01

Jun-00

Oct-99

0

Feb-99

4

Source: EIA, World Bank

8

Volume variation analysis for selected countries that are major importers and exporters of coal and petcoke. This is a selection of notable markets. Additional detail is available from CW Research as well as on-line at http://www.coalweek.com/ to the market data section.

Petcoke - US Exports (million tons - Aug)

Coal - Exports (million tons)

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

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WWW.CEMWEEK.COM/SUBSCRIBE

Coal Exports MoM (%) US petcoke exports prices MoM (%)

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION. WWW.CEMWEEK.COM/SUBSCRIBE

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION. WWW.CEMWEEK.COM/SUBSCRIBE

Coal - Imports (million tons)

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION. WWW.CEMWEEK.COM/SUBSCRIBE

Petcoke - US export prices (USD/ton - Aug)

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION. WWW.CEMWEEK.COM/SUBSCRIBE

Coal - Global export prices (USD/ton)

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION. WWW.CEMWEEK.COM/SUBSCRIBE

Natural Gas Prices (US$/mmBtu)

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION. WWW.CEMWEEK.COM/SUBSCRIBE

Natural Gas prices MoM (%)

Coal export prices MoM (%)

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION.

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WWW.CEMWEEK.COM/SUBSCRIBE

Source: CW Group analysis estimates

LM: latest month Jan 2015 except where specified; MoM: month vs previous month; YoY: month vs same month last year; YTD: year-to-date; YTD%: year-to-date vs previous year

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April / May 2015

28

MARKET DATA SNAPSHOT

CW Research

people

CRH looking for new finance director Irish cement manufacturer CRH announced that it will start looking for a new finance director as the current holder of the role, Maeve Carton, would lead a new strategic position from the start of 2016.

Carton will become group transformation director, identifying and implementing the optimum financial and business model for the group in the years ahead. “In this new role, Maeve will drive improved shareholder returns by identifying further synergies, efficiencies and cash generation opportunities as CRH continues to grow and acquire new businesses”, said the company in a statement.

Cementir appoints Chairman and CEO The Board of Directors of Italian cement manufacturer Cementir appointed Francesco Caltagirone Jr. as Chairman and CEO of the enterprise. Furthermore, the board appointed Carlo Carlevaris as Deputy Chairman and Riccardo Nicolini as General Manager. The Board of Directors also announced the addition of the Audit and Risk Committee in the persons of Paolo Di Benedetto, Veronica De Romanis and Chiara Mancini, as well as Nomination Committee and Remuneration Committee in the persons of Paolo Di Benedetto Veronica De Romanis, Chiara Mancini and Mario Delfini.

29 April / May 2015

General Manager of Caribbean Cement Company to be replaced The General Manager of Caribbean Cement Company, Anthony Haynes, will be replaced by a Mexican executive. Two weeks ago, Trinidad Cement announced that under a rights issue, minority shareholder Sierra Trading, a subsidiary of construction giant Cemex of Mexico, had increased its ownership of TCL from 20 percent to 39.5 percent. The chairman of Caribbean Cement Christopher Dehring said that as Caribbean Cement is part of a wider operation “whatever the group executive is working out with regards to any statement to do with operations, I much prefer it come from the company itself rather than the board members speaking out about any operational aspect of the company”.

Saudi Arabia’s Eastern Province Cement appoints Director General The Board of Directors of Saudi Arabia’s Eastern Province Cement Company announced the approval of the appointment of Fahd bin Rashid Al-Otaibi as director general of the company. The appointment will come into effect on May 3, 2015. Fahd bin Rashid Al-Otaibi holds a bachelor’s degree in Chemical Engineering from King Fahd University of Petroleum and Minerals Engineering and has held several lead ership positions in several major industrial companies. www.cemweek.com

Eric Olsen, CEO of future Lafarge-Holcim The Executive Vice President of Lafarge, Eric Olsen will be in charge of the operations of the new Lafarge-Holcim as the new CEO of the two merged companies.

Wolfgang Reitzle, Holcim’s Chairman of the Board of Directors, welcomed the proposal, while Bruno Lafont, Lafarge’s CEO, commented that Eric Olsen has been chosen for both personal and professional qualities. There have been extended discussions on the topic of the new CEO of the two groups, Bruno Lafont having seemed a sure bet up until Holcim’s board opposed his appointment. The current chairman and chief executive of Lafarge assured those unconvinced that he will allow Mr. Olson to take on the full role of the CEO of the company. Furthermore, he asserted his confidence that Mr. Olsen has the necessary skills to manage a company of the size of Lafarge-Holcim.

Bruno Lafont remains confident that the tie-up with Holcim will be completed by the summer. He stated that “there is enormous value to create, the team is there in place and everyone is working to get the deal completed.”

REGIONAL REPORT:

Dangote Cement ups total cement production capacity Dangote Cement has announced plans to complete projects in eleven African countries. The company now has an annual production across Africa of about 30 million tons of cement, buoyed by the successful inauguration of its plants in Cameroon and Senegal recently. Aliko Dangote said his conglomerate plans big for the African economy, saying Africans must look inward and put their human and natural resources to best uses. The group’s cement surpassed Nigeria’s average total consumption of around 20 million tons. The company has commenced production of the cement in some African countries which include Senegal, Cameroon and South Africa, and has yet to complete its projects in eleven other African countries. With the completion of these projects, the group’s total production would surpass 50 million tons.

Lower volume and value for Eurocement – Ukraine Eurocement-Ukraine, a unit of Russia’s Eurocement Group, has posted a record decline in cement output last year. The company produced 1.1 million tons of cement in 2014, worth UAH 688 million. The volume of cement production declined by 21.9 percent as compared to 2013, while the value of its cement output posted a 14 percent decline from UAH 800 million worth of cement produced in the previous year.

Eurocement-Ukraine’s net loss amounted to UAH 275.74 million, which was well below last year’s result. The bulk production was shipped to Kharkov, Dnepropetrovsk, Zaporozhye, Donetsk, Sumy, Chernihiv and Poltava regions. Eurocement-Ukraine was established in 1996 by converting the Balakleysky cement plant. The plant specializes

in cement production using the supply of clinker from Russian units.

Cement demand expected to increase in Saudi Arabia Saudi Arabia’s cement sector has seen cement sales increase in the first quarter of the of 2015, with demand boosted by the development of infrastructure and diminishing impact of labor shortage in the local markets. The housing sector is expected to expand due to the forecasted decline in land prices in the medium term for the benefit of individuals, as well as developers. This will further boost cement demand in Saudi Arabia. The local construction sector consumes about 54 percent of the domestic supply of cement.

Holcim implements shipping automation system in Eastern European plants Holcim enhanced the automation of its shipment handling and weighing technology towards a smart factory in its eastern European plants. The logistics software LOGiQ Schenck Process has been implemented in all 14 plants of Holcim from Slovakia to Bulgaria. Four other works are currently connected to the high-avail-

ability dispatch automation system that controls the entire freight by ship, rail and truck. The system interlocked with existing hardware and software components and is focusing on the networking of local intelligence. LOGiQ controls the workflow management system from order to deliver fully automatically and in the national language of the Holcim customers.

South Africa’s PPC slows expansion South African cement producer Pretoria Portland Cement Company (PPC) will expand more slowly after spending on several cross-border projects jacked up its debt load.

PPC is building plants in African countries, including Ethiopia and the Democratic Republic of Congo, aiming to generate 40 percent of its sales outside of the South African market by 2017. However, these projects are pushing up PPC’s debt levels and Chief Executive Officer Darryll Castle said PPC’s debt would likely hit as much as $982 million in the next two years. PPC is in talks with banks about changing the agreed debt covenants to reflect the fact that some of the debt was ring-fenced from the South African balance sheet.

HeidelbergCement shuts capacity in Tanzania HeidelbergCement plans to shut capacity at its Tanzanian unit due to oversupply and lower prices. As a result of cheaper

EUROPE, RUSSIA AND BALTIC REGION

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION. WWW.CEMWEEK.COM/SUBSCRIBE

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April / May 2015

30

imports from China and Pakistan, the company will cap output at 1.4 million tons of cement this year, shutting about a quarter of Tanzania Portland Cement’s capacity. TPCC, 69 percent owned by Germany’s HeidelbergCement, plans to scale back expansion and may cut jobs if the situation persists, said Managing Director Alfonso Rodriguez. “With current oversupply our business is not viable in the medium term,” Rodriguez said. “We may be forced to restructure our human resources.” Imports from China and Pakistan to Tanzania total about 400,000 tons, more than 10 percent of total demand. Prices are driven down as imports are not subject to the same taxes and regulations as local producers.

TABLE AVAILABLE IN THE CEMWEEK MAGAZINE PRINT EDITION. WWW.CEMWEEK.COM/SUBSCRIBE

high quality cement. The association seeks to ensure cheaper solutions, but there’s no denying that good quality goes with higher price. Andrzej Ptak, chairman of the Cement Association, said that every plant producing cement calculates their prices individually depending on demand. “It would be hard to say that there will be a reduction in prices due to rising prices of

carbon and energy”, said Andrzej Ptak.

Ethiopia drafts cement industry development strategy Ethiopia’s Ministry of Industry is drafting a national cement industry development strategy that will enable it to assist the fast growth of the industry. The ministry, in collaboration with the Adama Science and

Source: fortunedotcom

Poland’s Cement Manufacturers Association introduced quality designation Poland’s Cement Manufacturers Association introduced the product quality designation called “Sure Cement “. This would allow buyers to ensure they are purchasing

AFRICA

31 April / May 2015

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Source: energyspectrumindo.com

Technology University, started drafting the national cement industry development strategy last July. The cement industry is facing several challenges including high production cost, limited market, inadequate transport service and unavailability of locally produced packaging materials.

The construction boom that started in 2008 created a huge demand to cement that led to the impartation of cement in large quantity with hard earned foreign currency. The installed production capacity has reached 11.2 million tons. This is expected to further increase to 17.15 million tons. The factories are actually producing 5.47 million tons per year. The newly built Dangote Cement factory will soon start channeling its product to the market. The factory built at a cost of $500 million near Muger town, has the capacity to produce 2.5 million tons of cement. The factory recently started trial production of clinker. Habesha Cement Factory is also expected to start production in 2016. Habesha has an installed cement production capacity of 1.4 million tons.

Germany’s Heidelberg signs contract extension with waste management company Heidelberg Cement Group signed a six-year contract extension with waste management company Shanks Group for the supply of its Icopower energy pellets. Icopower, part of Shanks’ Solid Waste Division, will supply the German cement manufacturer with an

increased volume of 54,000 tons per year of the pellets, derived from commercial waste.

Waste as a fuel has been a popular choice for cement kilns due to its lower cost. Without the use of waste derived fuels, it would be difficult for many cement plants in European countries to keep competitive. “Unlike solid recovered fuel (SRF) or refuse derived fuel (RDF), ICOPOWER® energy pellets are not classified as a waste product in the Netherlands”, said Shanks in a statement.

Israel eases restrictions on cement shipments to Gaza The reconstruction of Gaza has barely begun, but aid agencies and analysts say that prospects for recovery have been hampered by the political wrangling from Islamic militant group Hamas and Abbas’ Fatah party. None of more than 12,000 destroyed homes has been rebuilt. Border restrictions for building materials transport largely remain in place, with the vast majority in Gaza unable to trade. Israel allows the import of some cement and steel for reconstruction, easing restrictions imposed to prevent Hamas from

diverting the materials for military use. The new mechanism has made cement available to repair tens of thousands of homes, but many homeowners cannot afford it. The groups urged the world to follow through on $3.5 billion for Gaza aid that was pledged six months ago, saying only $945 million was released so far. Israel will allow the entry of large quantities of cement into the Gaza Strip for a period of three years.

Lebanese cement demand expected to grow further Lebanese cement sales increased in March 2015 compared to the similar period in 2014, driven by an increase of improved construction workers and acceleration of infrastructure projects. Furthermore, Lebanese cement demand was boosted by the impact of the decline in labor shortages in the construction sector. Cement sales in 2015 are expected to grow by 7.1 percent as compared to the previous year as the Ministry of Housing plans to implement a housing scheme that will see cement demand on the rise.

MIDDLE EAST

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tex Cements has already come forward to set up their cement unit at Gangavaram in Guntur district.

Demand for cement in India to recover in Q2 FY16 Cement demand in India remained dull in March 2015, but it is expected to see a revival in July-September, following the steep increase in allocations to infrastructure spending. Cement companies in India cut deliveries by as much as 30 percent in March due to the weak demand, influenced primarily by the government’s reduced spending to manage the fiscal deficit. The steep increase in allocations to infrastructure spending, announced in the recent Union budget, will see demand gradually revive from Q2 FY16. Average cement prices remained flat in Northern India market on quarter on quarter basis, while the industry is expected to grow by 7 to 8 percent in 2016.

India’s UltraTech Cement forecasts demand growth Indian cement manufacturer UltraTech Cement is in the middle of an expansion drive aiming to take on competition from the Holcim-LaFarge combine. Despite the overall decline in cement volumes in India in the March 2015 quarter, UltraTech expects to capitalize on the expected growth of the industry in the second quarter of the year.

According to UltraTech managing director O.P. Puranmalka, the government’s recent focus on road projects, housing for all, and an increase in state allocations will drive infrastructure and housing demand. “We will be able to add volume growth through our recently commissioned brownfield expansion at Aditya Cement in Rajasthan. We will also add four other grinding units — one each in West Bengal and Bihar, Jhajjar and Nagpur, along with one bulk terminal in Pune. Additionally, the recent Jaypee acquisition made by us in Satna should add to the 33 April / May 2015

growth”, said O.P. Puranmalka. By March 2016, the company’s capacity is expected to have reached 71 million tons per year with commissioning of our new projects. By 2020, the company aspires to have a capacity of 100 million ton.

India’s Mumbai Port Trust allots land for cement handling terminal India’s Mumbai Port Trust expects at least 350 heavy vehicles per day due to shipment of cement by the coastal route from Gujarat. “We have allotted 2.5 hectares of land at Petroleum go down to Ultratech cement for 30 years, where cement can be shipped from other states and distributed to users across the city”, said MbPT’s chairman and managing director Ravi Parmar. In 18 months, when a fully automated cement handling terminal will be ready, it will promote movement of cement required for city’s consumption through the coastal route. Mumbai’s cement consumption reached 1.25 million tons per year to meet developmental needs. Currently, this cement is moved by road/rail through neighboring states, which requires the entry and exit of nearly 350 trucks per day, congesting the already overstrained city roads.

India’s Andhra Pradesh to sign MoUs with Chinese companies The Chief Minister of India’s Andhra Pradesh, N. Chandrababu Naidu, will sign 13 Memoranda of Understandings (MoUs) with various Chinese companies. The Andhra Pradesh government will sign six Government-to-Business memorandums.

Under the Business to Business segment, Andhra Pradesh will sign two key MoUs with Chinese industries in Beijing. The local government will sign an MoU with Vertex Cements (India) and Sinoma. Verwww.cemweek.com

Cement companies in China are expanding Many large cement companies in China are expanding to other industries, such as sand and gravel, aiming to build a complete industrial chain. Furthermore, domestic companies are investing in waste disposal.

The building materials market is currently easing in the country, but the real estate stimulus policies are exceeding market expectations. Last year, cement demand has been dragged down by the decline in real estate investments. The problem of excess capacity in the cement industry needs further implementation of structural adjustment of cement industry.

China’s Hongshi and Nepal’s Shiva Cement to invest in cement production in Nepal A Nepalese and a Chinese company have signed a joint venture investment agreement for cement production in Nepal. The $300 million investment is one of Nepal’s biggest in the cement sector, and has a 7:3 equity structure between Hongshi Holdings Limited of China and Nepal’s Shiva Cement. “This project with advanced technology will adopt a new dry process with the use of 95 percent domestic raw materials”, said Xu Youyuan, Executive Vice President of the Chinese company. Nepal’s booming cement industry in 2012 has attracted Hongshi to the Nepalese market.

There are over 40 cement plants in Nepal and domestic products only account for 85 percent of the total consumption in this country.

Pakistan’s cement industry affected by illegal imports The illegal import of cement from Iran to Pakistan and tax evasions at import stage

Source: cmc.com.cn

by misdeclaration is taking its toll on the domestic cement industry. The All Pakistan Cement Manufacturers Association (APCMA) urged the government to stop this trade immediately. According to an APCMA spokesman, the quantity of cement being imported from Iran has been found to be understated on the Customs “Goods Declaration” form resulting in a substantial loss to the national exchequer.

“At present the country’s surplus cement production capacity is more than 20 million tons per annum and it is coming under further pressure because of the illegal import of the cement”, said the spokesman.

Results of Pakistan’s Cherat Cement deteriorate due to plant shut down Pakistan’s Cherat Cement registered marginal increase in the first six months of the fiscal year, but that tally plopped due to a planned plant shut down in 3QFY15. The cost of production continued to outpace sales growth since the beginning of the fiscal. Distribution and administrative costs also kept inching higher as a proportion of the top line. Cherat Cement informed that Rs1 billion will be spent on installing another waste heat recovery system for the second production line and that the necessary equipment will be purchased from China, after the board has given necessary approvals. Cherat Cement’s net margins deteriorated only slightly with the 9MFY15 ratio standing at 20 percent, compared to 22 percent in 9MFY14.

Vietnam’s Vissai Cement invests to add residual heat power plant Vietnam’s Vissai Cement Group (Ninh Binh) selected China’s Sinoma Group as the contractor for its project to generate thermal electricity at five of its cement production lines. Under the contract, Sinoma

will supply materials and equipment, construction and installation. The residual heat power plant will have a capacity of 20MW, consisting of 5 units with an individual capacity of 4MW at cement production lines of Vissai. Construction is expected to begin in the second quarter of the year, with completion scheduled in 16 months. The investment is expected to reduce power consumption for Vissai Cement, as well as provide sustainable production growth and improved competitiveness for the cement manufacturer.

Vietnam focuses on technological innovation Outdated technology in Vietnam’s cement industry will be phased out, as more investment projects will be implemented to improve technology standards. According to Le Van Toi, Head of Vietnam’s Ministry of Construction, the measures to be implemented aim to gradually improve the quality of cement production. Technology innovation, higher quality and productivity is one of the investment orientation in the cement industry, under development plan for the Vietnam cement industry, presented by the Prime Minister for the 2020-2030 period. New test laboratories will be built for standards compliance and to ensure consistent quality at competitive prices. Furthermore, production capacities will be enhanced at several plants

in the country, according to Vietnamese officials.

Vietnam’s Binh Dinh to build concrete roads Vietnam’s Binh Dinh province issued a decision regarding the approval of a plan for concrete roads development this year. Binh Dinh’s priority is to support concrete road development in three districts: An Aging, Vinh Thanh and Van Canh. The provincial budget can support 167 tons of cement per km of rural road. According to the register of the communes, the total length of registration of concrete rural road this year is over 332 km.

Expansion of cement project in Vietnam proposed The Zhongshan Cement Project in Luong Son district, Hoa Binh, Vietnam has been proposed to have its capacity extended from 0.91 million tons per year to 5.5 million tons per year. According to Le Van Toi, Head of Construction Materials, the written requests for capacity expansion have been sent by the Government Office transferred to the Ministry of Construction. The Zhongshan Cement Project is included in the Planning and Development of the Cement Industry in Vietnam 2010-2020, approved by the Prime Minister’s cabinet.

The project requires a total investment of VND 1,200 billion.

SOUTH EAST ASIA AFRICA

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panies decreased by about 40,000 tons in February this year. Even during the first two months of this year sales were down 8.7% from the same period last year. If cement demand in the country continues to be sluggish, Semen Indonesia is considering the possibility of exporting cement.

A number of neighboring countries in Southeast Asia and South Asia could accommodate these imports.

Banten Province posts cement sales increase despite drop in Indonesia The weakening of Indonesia’s cement market in the first quarter of 2015 did not apply to sales in the Banten Province. In January

Source: .lcnewsgroup.com

Cement companies in Indonesia consider exporting cement Cement companies in Indonesia began taking into account the possibility of exporting their products if demand for the building materials in the country continues to decline. The President Director of PT Semen Indonesia Tbk said the company’s domestic cement sales decreased by 2 percent in February to only 1.92 million tons from 1.96 million tons in the previous month. Sales have declined mainly driven by the decrease in construction activity due to the rainy season, coupled with the delay in government infrastructure spending. Sales of state-owned cement com-

35 April / May 2015

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- March 2015, national cement demand fell by 3.3 percent. However, some areas have still posted increases, such being the case of the Banten Province. During the first three months of the year, cement sales in Banten increased by 6.2 percent as compared to the similar period in 2014. The cumulative sales volume in the region amounted to 0.76 million tons. In March, demand grew by 0.3 percent as compared to the previous month. Cement sales in Banten reached 262,335 tons in March 2015.

Indonesia’s Semen Gresik targets market share growth Indonesia’s Semen Gresik targets a 77 percent market share in Malang and Pasuruan.

In January-February 2015, sales of Semen Gresik in East Java reached 819.11 tons. The Head of Sales Department of the Semen Indonesia subsidiary said that sales in Malang and Pasuruan in January-March 2015 accounted for a market share of 76 percent. The company plans to further boost its market share in the region this year to 77 percent. Sales in the area of Malang and Pasuruan account for 13.7 percent of sales Semen Gresik to East Java as a whole. In January-March 2015, the company’s sales in East Java amounted to 1.8 million tons, down 3.4 percent compared to 186 million tons in the similar period last year.

Indonesian cement maker adds capacity Indonesia’s Cahya Mata Sarawak plans to boost cement production capacity to 2.75 million tons per year, accounting for a 60 percent increase in capacity. The company will commission its third grinding plant in the first quarter of 2016. The proposed RM190mil plant project located adjacent to the group’s clinker plant in Mambong, Penrissen Road is progressing well, with trial production scheduled by end-2015.

“With cement demand in Sarawak growing at between 3 percent and 4 percent per an-

Source: mmbiztoday.com

num, we estimate that with increased production capacity, we will be able to meet the demand at least in the next 10 years,” said group managing director Datuk Richard Curtis. CMS, Sarawak’s sole cement manufacturer, now owns and operates two cement plants with annual combined rated production capacity of 1.75 million tons.

Curtis said the company would invest another RM17mil this year to enhance its cement distribution capabilities.

Malaysia’s cement industry to benefit from the 11th Malaysian Plan Malaysia’s cement industry will stand to benefit following the unveil in the second quarter of 2015 of the 11th Malaysian Plan that includes key mega projects like the MRT Line 2, LRT Line 3, the Warisan Merdeka Tower project and the Sungai Besi Ulu-Kelang Elevated Expressway.

However, the concern now is the weak ringgit and the low oil prices, and its bearing on the Government’s development expenditure. The property market is expected to be moderate this year due to tight fiscal policies on mortgage lending and

the 6 percent goods and services tax imposed on building materials like cement.

Key industry players are however unsure how soon the projects will be implemented. Other risks in the industry include increase in energy, particularly coal and electricity prices as well as intense competition among industry players. The second quarter of last year saw a majority of the country’s top cement manufacturers raising their cement prices by 7 percent to 9 percent, with Holcim taking the lead followed by Lafarge Malaysia, Tasek and Hume Cement. The outlook for 2016 and beyond is uncertain, but if all projects announced are implemented as scheduled, the demand for cement would continue to remain robust.

Cemex Philippines opens new cement mill Cemex Philippines opened a new cement mill at its Apo Cement Plant in Naga City.

The PHP 3 billion investment is part of the company’s comprehensive expansion plan in the country. The 3,433-square-meter facility increases the capacity of the Apo Plant by 1.5 million tons per year or an additional 40 percent in total production capacity of Cemex Philippines. “Our interest in the country remains very high, and we continue to study closely new opportunities as we see how the administration is doing a very good job in boosting inclusive growth efforts and economic standing,” said Joaquin Estrada, Cemex Asia president.

ASIA-PACIFIC AFRICA

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Mexico to see higher cement consumption Cement demand in Mexico is expected to increase by 5 to 6 percent this year due to growth in private investment in construction, which has been on an upward trend since the second half of 2014. The volatility of the dollar, decrease in oil prices and cuts in federal spending have boosted construction activity in the country. On an annual basis, about 32 million tons of cement are produced in Mexico, worth about $13 billion. However, the installed capacity of plants in the country amounts to 51 million tons. Economic reforms are expected to strengthen the cement industry as a result of the increased spending in infrastructure, as well as housing, commercial and industrial construction.

Peru’s Cementos Pacasmayo boosts net profit despite cement sales decline Peru’s Cementos Pacasmayo announced its consolidated results for the first quarter of 2015. Consolidated EBITDA increased by 10.5 percent to PEN 89.2 million in the first quarter of 2015 as compared to PEN 80.7 million in the similar period of 2014, driven by the successful implementation of cost control measures. Net income increased 31.4 percent to PEN 52.3 million from PEN 39.8 million in Q1 2014, the expansion being attributed to higher gross profit and a positive impact from exchange rate fluctuations. Cement sales volumes decreased by 5.6 percent compared to the first quarter of 2014, mainly due to lower cement demand from the public sector as new local authorities took office on January 1, 2015. The Piura plant project remains within the planned timeline and budget, with production scheduled to begin during the second half of 2015.

37 April / May 2015

Bolivia’s Itacamba Cement boosts cement imports from Brazil Bolivia’s Itacamba Cement has begun importing large quantities of cement from Brazil. The company aims to meet the growing demand for the building material in Santa Cruz. Increased volumes of cement imports are expected to continue until the second half of 2016, when the Yacuses cement plant is scheduled to begin operations. Itacamba Cement is currently planning to imports 5,400 tons of cement per month, but this quota may increase depending on the behavior of market and if it still requires higher volumes.

Itacamba Cement plans to spend $220 million in the Yacuses Cement Plant. For the investment, the company has already committed $70 million.

Peru’s Unacem expects cement demand growth Unacem, one of Peru’s largest cement manufacturers, does not plan to cut production volumes this year despite the slowdown experienced in the mining sector. According to Carlos Ugas, the company’s CEO, Unacem’s first quarter results were in line with the results posted in the similar period last year. The company posted a 5 percent growth in sales due to the start of project like the Metro de Lima. With many delayed investments to begin implementation, the company believes that demand for cement could improve. Unacem also expects to export up to 500,000 tons of clinker this year to Chile and Venezuela, and possibly Brazil.

Unacem plans expanding production capacity at the Condorcocha and Atocongo plants, aiming to reach a total of 2 million tons per year.

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Cement Association of Canada applauds release of Budget 2015 The Cement Association of Canada (CAC) applauded the release of Budget 2015 that indicates that several billion dollars have successfully been invested in critical infrastructure projects across the country. “It is clear to our members that the new Building Canada Plan has played a key role in assisting Canadian manufacturers recover from the recession and has allowed the construction of critical infrastructure in Canada”, said CAC President and CEO Michael McSweeney. The government has committed significant long-term funding through the new Building Canada Plan to ensure that priority projects throughout Canada get built, and are built in a more sustainable way by promoting full lifecycle considerations in the design phase.

“Growth depends largely on investment and the competition for investment from multinational companies is fierce and intense. Achieving and sustaining a comparatively low tax rate is also essential to maintain any advantages we have gained on this front”, added Michael McSweeney.

Costa Rica denies use of imported cement Shipments of Chinese cement in Costa Rica, better and stronger than the locally produced commodity, is being banned by the Costa Rican Institute of Cement and Concrete (ICCYC), in which two national cement companies are part of the board.

The agency said that these shipments did not comply with the Cement Technical Regulations in force in the country. The use of imported cement was denied for the for the dam project on the Nosara River. If constructors want to use imported cement, a series of laboratory tests must be performed

Source: wordpress.com

to establish a comparative parameter between domestic and imported cement.

Cement sales fall in Puerto Rico Puerto Rican cement sales fell to 1,296 sacks in March, down 4.6 when compared to the same month of the last year. Sales have been affected by the poor performance of the housing construction market and by the lack of resources by the government to build public works. In 2014, sales decreased by 9.8 percent after two years of successive increases, while production fell by 1.9 percent.

duction capacity. The acquisition added 3.3 million tons of cement to its capacity. Furthermore, the company acquired cement assets of French Guyana, a grinding plant of 200,000 tons capacity, with a port facility. This year, the company expects to receive about $300 million from operations in the United States and Central America and the Caribbean. In Colombia, the company expects a 6 percent increase this year, Cementos Argos being optimistic about the performance of the cement industry.

tion sector and in cement consumption in these regions. Two new of the new cement factories will begin operating already in 2015: one in Edealina, in the State of Goiás (GO), and another in Primavera, in the state of Pará (PA). In the second phase, the construction of two plants in the State of Ceará is planned, in the cities of Sobral and Pecém, and one in the State of Paraíba, in the city of Caaporã. The beginning of activities in the three new units is scheduled for the second half of 2017. With its new factories, Votorantim Cimentos will increase its cement production capacity in Brazil in 18%, adding about 6 million tons to the current capacity of 32 million tons of cement per year. In the Americas and Europe, investments include one cement factory in Bolivia, located in Yacuses, in partnership with two other companies, and two new plants in Turkey. The company also evaluates the construction of a new factory in Morocco. In the United States, where Votorantim Cimentos has assets in the Great Lakes region, there is a project for the expansion of the Charlevoix Unit, in the State of Michigan. The new projects outside of Brazil will add 2.5 million tons to the company’s installed capacity.

Votorantim announces investments Cement crisis persists in Colombia Votorantim Cimentos announces a new Cement is traded at high prices in Colom- investment package, going from 2015 to bia and the issue is expected to continue 2018. R$ 5 billion will be invested in five in the future. A bag of cement is traded at new factories in Brazil, one in Turkey and the border at COP 2,000 – COP 2,500. The one in Bolivia, as well as in the expansion high prices are taking a toll on construc- and modernization of existing units.The tion activity as many contractors have announcement comes after an investment decided to halt operations at sites. Fur- plan of $ 10 billion, completed in the pethermore, the rising demand for cement riod between 2007 and 2014, when the cannot be met as the building material’s company expanded its global production supply in the country is limited. This af- capacity in 51%. In Brazil, the priority is to fects builders, construction companies, as increase production in the Central-North well as hardware stores. and Northeast regions. The company, AMERICAS which follows a strong long-term strategy, Colombia’s Cementos Argos reports identifies growth potential in the construcrevenue increase Colombia’s Cementos Argos reported revAMERICAS enues of $5.8 billion in 2014, posting a 17 percent increase compared to the previous year. The company’s growth was driven by its development of its business in the US, which posted a 12 percent growth. Furthermore, its business in Colombia rose by 6 percent. Last year was transformational and highly positive for the company, with progress being made in many aspects such WWW.CEMWEEK.COM/SUBSCRIBE as $785 million procurement business expansion. The main aspect was the acquisition of cement assets in Florida, Vulcan Materials, doubling the company’s US pro-

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sector coverage : Construction & BUILDING MATERIALS by BmWeek.com

Translucent concrete gaining popularity in Ukraine Translucent concrete or litrokon has already gained popularity in the market of building materials due to its durability and water resistance in Ukraine. Translucent concrete is a composite material, which consists of a mixture of grout and light-transmitting glass fiber strands. The amount of fiber is only 5% of the total weight of the plate, whereby it does not lose strength, but becomes very airy in appearance. Translucent concrete is characterized by high fire resistance, wear-resistant characteristics, it does not absorb moisture and is not destroyed at low temperatures, making it a promising material for the construction of private houses.

reduce the environmental footprint of precast concrete. This patented technology reduces CO2 emissions in the cement manufacturing process and uses CO2 to produce precast concrete. The overall carbon footprint has decreased to 70%.

Under this agreement, Lafarge will commercialize this technology around the world, offering a complete solution of cement and concrete in partnership with

Lafarge ties up with Solidia for precast concrete Lafarge has taken another step in its partnership with the US start-up Solidia Technologies for the commercialization of innovative technology to significantly 39 April / May 2015

Solidia. According to the report, the offer will be launched initially in key markets in North America and Europe for the production of concrete elements such as paving stones, tiles and blocks. Lafarge has worked for over twenty years to master its environmental footprint, including the reduction of its CO2 emissions. It has reduced its emissions by 26% per ton of cement since 1990.

Source: www.cargotec.com

Concrete

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lion Colombian Natural Resources (CNR) since it was forced to stop exporting coal in January 2014 due to the country’s new environmental regulations.

Coal ash ponds for Duke Energy US company Duke Energy plans to build lined on-site landfills to store millions of tons of coal ash at two of its retired North Carolina generating plants. The utility an-

nounced it was submitting plans for the landfills at its Dan River Station in Eden and at its Sutton Plant outside Wilmington. The company said the landfills will provide permanent storage for more than 6 million tons of coal ash. They are in addition to plans to build off-site landfills to handle more than 3 million tons of ash from the plants. The on-site landfills will have synthetic and natural barriers and the ash will be stored dry.

Source: trucks.mercedesbenzme.com

Goldman Sachs looking to exit coal business.

Goldman Sachs is reportedly looking to unload its coal assets, as it faces “operational issues” and dramatically lower prices for the commodity. This would put an end to Goldman’s rocky involvement in raw-materials production. Goldman has faced protests, falling coal prices, an environmental law and the Federal Reserve considering limits on the ways commercial banks can produce, store and sell raw materials, as it struggled to make the investment pay off. The investment bank has been quietly seeking a buyer for its $3 bil-

Source: www.cargotec.com

UK aggregates sector to receive rebates The UK local aggregate sector is set to receive several million pounds in tax rebates. This is a result of the European Commission’s conclusion that levy exemptions for most secondary aggregates are lawful. Introduced in the UK in 2002, the levy included exemptions for secondary aggregates such as those recovered from industrial combustion or separation of certain industrial minerals, to encourage the use of ‘less environmentallydamaging sources of aggregate’, the report said.

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Aggregates

sector coverage : Construction & BUILDING MATERIALS by BmWeek.com

Construction & projects Arup and Ramboll to develop Copenhagen metro Arup and Ramboll will partner for an infrastructure project that will have Ring project’s Light Rail follow the Ring 3 orbital motorway around the Danish capital. The 27km double-track system will have 27 stations with a rolling stock fleet of 27 light rail vehicles. Client Metroselkabet wants the line to promote the use of public transport and to encourage the urban development along the route. Arup’s role as part of the joint venture includes the design coordination and technical integration of the light rail systems, the design of the control and maintenance center, traction power, ground bourne noise and vibration modelling. The line will link 11 municipalities, from Lundhofte in the north to Ishoj in the south. It will run a service of light rail vehicles every five minutes at peak times with an expected journey time of 55 minutes for the 27km.

Qatar to continue large spending on infrastructure Qatar will continue to invest around $350bn over the next 15 years. “In the runup to the 2022 FIFA World Cup and in line with the National Vision 2030 document, Qatar will be investing nearly $350bn,” said George Ayache, General Manger of IFP Qatar. The official noted that the construction sector will remain a vital contributor to the development goals, considering that Qatar’s economy is expected to record a 7.7 percent growth in real GDP this year, with the non-hydrocarbon sector accounting for 50% of GDP.

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equipment

Siwertell receives order for cement unloader in Kuwait Siwertell, part of Cargotec, will supply a second road-mobile unloader to Acico Construction Co in Kuwait, reported the company. The company took delivery of its first mobile unit from Siwertell in July 2014, following earlier very positive experiences when operating Siwertell mobile unloaders. The trailer-based, diesel-powered, Siwertell 10000 S road mobile unloader will be used at Shuaiba Port in Kuwait to discharge cement at 300 tons per hour and will be equipped with a double bellows system to allow continuous unloading operations, and a dust filter to minimize dust creation. The order is scheduled for delivery by the end of May 2015. The unit is under construction at Siwertell’s manufacturing premises in Bjuv, Sweden.

Cement mill installation in Turkey begins Loesche has begun the installation of a cement mill in Turkey. The LM 45.4 mill is being installed at the Bastas Baskent Cimento plant in Elmadag, Turkey. The mill was ordered by Vicat Service Technique Ciment in May 2014, with Loesche supplying the mill within a 10 month delivery period. The mill has a grinding rate of 260 tons per hour to a product fineness of 16 percent R 90 µm. The LM 45.4 mill has an installed drive power of 2100 kW. Loesche’s scope of supply also comprises weigh feeders, apron feeders, magnetic separators, metal detectors, shutoff and control flaps, vibrating conveyors, a bucket elevator and expansion joints.

Russian cement manufacturer receives new equipment Russian manufacturer Ulyanovskcement,

part of the Eurocement Group, has commissioned the construction of an automated transportations and shipment of bulk cement modular from German equipment manufacturer IBAU HAMBURG. The decision is part of a new project to build a branch for the shipping and packing of cement. The new equipment will come with a dust-reduction system, which will contribute to the environmental security of the enterprise.

Atlas Copco exhibits new Tier 4 Final XAS 185 portable compressor The new Atlas Copco XAS 185 portable compressor was presented during The Rental Show in New Orleans. The XAS 185 gives contractors a source of compressed air for a variety of jobs, including operating pneumatic tools and sandblasting. It’s compact, efficient and economical, and features a 49-horsepower Kubota diesel engine that complies with Tier 4 Final emission standards. The XAS 185 features a fully automatic regulator that constantly varies the engine speed according to air demand, which minimizes fuel consumption. The 20-gallon fuel tank allows contractors to use the portable compressor for a full eight-hour shift without needing to refuel. They also can access all the controls from a single panel. The XAS 185 features Atlas Copco’s HardHat™ canopy that is made from durable, weatherresistant polyethylene. The canopy not only effectively protects the compressor’s components but also resists impacts and will not corrode. This minimizes repairs and virtually eliminates the need to repaint, in order to decrease the cost of ownership and secure its resale value. All exterior parts are made of a powder-coated Zincor® steel for corrosion resistance. “The XAS 185 is ideal for contractors, but also rental centers, where high utilization and fast ROI are key,” said www.cemweek.com

Rich Elliot, Atlas Copco product manager, low-pressure compressors.

FLSmidth to supply equipment to Egyptian cement plant FLSmidth has received two contracts from the Egyptian cement producer Misr Cement Company (Qena) to supply equipment for a cement plant which was also originally supplied by FLSmidth. The cement plant is located approximately 45 km from Luxor in Egypt. The equipment to be supplied includes an ATOX© coal mill, an OK© vertical cement mill, Pfister© weighing and dosing systems, MAAG Gear© reducers and Airtech filters, as well as other smaller pieces of equipment. “Our newly established Products & Upgrades group will be responsible for supplying the equipment - an offering which we are currently expanding,” said President of the FLSmidth Cement Division Per Mejnert Kristensen.

FLSmidth exits O&M contracts in Nigeria FLSmidth has reached an agreement to exit O&M contracts in Nigeria. In November 2013, FLSmidth signed a number of contracts with the Nigerian cement producer Dangote Cement PLC for operation and maintenance of production lines at their Ibese and Obajana cement plants in Nigeria for a period of five years. Due to changed market conditions, Dangote Cement and FLSmidth have reached an agreement to end the operation and maintenance collaboration on the two plants. FLSmidth’s Group guidance for 2015 will not be impacted by the discontinuation of the O&M contracts. However, the demobilization in Nigeria will have a negative impact on EBITA in the Customer Services division in the first quarter in 2015 of DKK -73 million.

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FLASHBACK NEWS FLOW ( 2 MONTHS )

.com

CW Research

Recent released reports:

darker red shows higher news volume

Country report: Poland Cement Market (2015 update)

Country report: Zimbabwe cement market (2015 update)

Country report: Madagascar cement market (2015 update)

Country report: Argentina cement market (2015 update)

Country report: Colombia cement market (2015 update)

CW Group Meeting Agenda The CW Group will be hosting and participating in a number of webinars and conferences. We invite you to join us on-line or in person at the events to discuss our views of the industry. To learn more, please visit http://research.cwgrp.com/meetings

CW Research Webinars: Global Cement Trade Prices Report: 2Q2015 update and outlook Global slag markets a quick look at the next year

43 April / May 2015

Conferences where the CW Group will be presenting September 17, 2015 at 2:00 PM GMT

Cement Business & Industry Africa 2015

June 25-26, 2015

Johannesburg, South Africa

October 15, 2015 at 2:00 PM GMT

Solid Fuels Summit India 2015

September 4 , 2015

Mumbai, India

AshTrade India 2015

September 4 , 2015

Mumbai, India

Cement Business & Industry India 2015

September 3-4, 2015

Mumbai, India

World Paper & Pulp India 2015

September 8-9, 2015

Mumbai, India

CW Summit Americas 2015

September, 2015

Miami, USA

Slag & AshTrade Americas

Sept 30 - Oct 1, 2015

Rio de Janeiro, Brazil

www.cemweek.com

buzz TOP CEMWEEK STORIES 1

Holcim’s Siggenthal cement plant restarts production

2

Cementos Molins acquires Bolivian cement manufacturer

3

Colombian cement company considers acquiring assets of Lafarge and Holcim in AL

4

HeidelbergCement interested in Lafarge and Holcim assets

5

Peru’s Yura invests in machinery and equipment

6

Romanian companies to invest in Egypt’s cement sector

7

Lafarge and Holcim sell Brazilian assets

8

Sale of Holcim Romania assets attracts interest

9

Russian Pikalevsky Cement boosts production

10

Dangote Group to establish coal fired power plants in Nigeria

11

Italian Buzzi Unicem executes agreement with Wietersdorfer

12

Russia approved Holcim’s acquisition

13

Brazil cement company to invest £1 billion

14

Cement prices stabilize in Egypt

15

Russian company supplies equipment to cement plant in Uzbekistan

CEMWEEK.COM acting africa aims alexandria annual arabia’s argos assets bank

board building

cemex chairman chief china

Synbra acquires German-owned Knauf Insulation

2

Illegal quarries in Peru investigated

3

Knauf opens new plant in Russia

4

Price Index of Construction Materials of Lima, Peru increases

5

U.S. Concrete posts Q2 results

6

Cementir to supply concrete for Italian project

7

Egypt imports steel and cement from Turkey

8

Landfill expansion in US for coal fly ash storage approved

9

Egyptian steel companies file anti-dumping claim

10

International exhibition of cement to be held in Egypt

11

Researchers develop new method of building materials

12

Turkish researchers develop building material from waste ash

13

Construction activity in Germany drops

14

Waste generated Dubai’s construction sector increased

15

New brick factory launched in Russia

cements

coal consumption

continue costs countries debt

decline directive direc-

energy

tor directors domestic eastern egypt egyptian

equipment eurocement executive expansion exports facility

factory furthermore gaza grow investment karnataka limited

growth holcim

india india’s indonesia infrastructure

imports improvement increased

lafarge

lawsuit limestone

manager manufacturer materials merger minister

ministry natural nigeria operations owned plans

plants portland power pradesh

previous

BMWEEK.COM

TOP BMWEEK STORIES 1

cargo

acquisi-

gregate

tion

activity ag-

aggregates agreement aims

approved awarded bank brick built coal commercial commission

continue

canal chief

concrete

contract contractors costs cubic decline devel-

op development director dropped dubai economic energy engineering environmental estate european executive expand expansion

government growth housing india industrial industries infrastructure insulation international investment lafarge management markets meters mining minister national output plans plants posted power price private product products facilities facility furthermore

project

public qatar quality quarry rate ready real road roads russia

recovery region residential results rise

sector

signed spending sales sand saudi states steel technology transport united units value waste work zawya 2014

www.cemweek.com

April / May 2015

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