AUSTRALIA: Airs residents' concerns about limestone mine expansion

Residents concerned about the proposed extension of Cement Australia's East End mine site have had their views tabled in state parliament.

Member for Gladstone Liz Cunningham this week tabled letters from the East End Mine Action Group.

The State Government is processing an environmental impact statement from Cement Australia in relation to extending its extraction industry for the mine near Mt Larcom.

Mrs Cunningham told the parliament that over many years residents who lived near the mine site had expressed concern about the impact of mining on their properties, and in relation to dewatering.

"It would be correct to say that the previous government - the Labor government - dismissed their concerns, and it is with regret that the current government has also not given weight to their concerns either," Mrs Cunningham said.

"For people like Bill Geaney, who lives across the road from the mine, the impact of that mining extraction has been significant to his property.

"He has to purchase water. He has had to face the possibility of his stock not having an appropriate water supply." 

Mrs Cunningham said the East End Mine Action Group had been active for years, trying to give government an understanding of the impact of the Cement Australia project on properties.

"I have had to deal with both representatives of Cement Australia and these landowners, and I would have to say that each of them are wonderful people to deal with," she said.

"But I would ask the government today to consider these submissions and to understand that a farm without water is useless and that the concerns that these farmers have are genuine.

"They deserve to be considered in the context of an increase in the project and also the impact of that on their farms."

MOZAMBIQUE: Mozambican cement company’s sales rise 9.8 pct in 2013

Sales of cement and clinker by Cimentos de Moçambique, the Mozambican subsidiary of Cimentos de Portugal (Cimpor) rose by 9.8 percent in 2013 to 1.299 million tons, according to the group’s annual report and accounts.

Concrete sales increased by 49.8 percent to 172,000 cubic metres and the company’s turnover totalled 141.9 million euros, which was a year on year rise of 5.4 percent.

In 2013 two new cement mills came online in Dondo and in Nacala and the group noted that “a more aggressive commercial policy improved the company’s competitiveness in relation to imported cement.”

Last year Cimentos de Moçambique invested 24.5 million euros in Mozambique, mainly in installing a cement mill in Dondo, on the outskirts of the city of Beira.

PHILIPPINES: Cement industry growth ‘to continue’

CEMENT manufacturer Cemex Philippines remains optimistic that growth in the cement industry will continue to grow stronger this year on the back of the robust construction industry and high government spending.

“We expect the growth to continue this year,” said Paul Arcenas, Cemex Philippines vice president for strategic planning at the sidelines of yesterday’s Build Unity launching rebuilding program of Cemex Philippines Foundation for the communities in northern Cebu.

Arcenas said the industry logged six percent to seven percent growth per year over the last three years.

According to industry reports, cement sales in 2013 grew 5.9 percent to 19.445 million tons from 18.356 million tons in 2012. The last quarter of 2013 added 4.503 million metric tons (MT) in sales or 2.1 percent higher than the 4.409 MT in the same quarter of 2012.

Highest

In 2012, the local industry posted a 17.5 percent growth, its highest in 15 years, having sold 18.4 million tons of cement from 15.6 million tons in 2011.

Cement firms attributed the growth to accelerated government and private sector projects. They predicted growth will be sustained in 2014 with the growing list of infrastructure projects under the private-public-partnership program and the increase in budget of the Department of Public Works and Highways for infrastructure and housing programs.

In anticipation of the huge demand, Arcenas told Sun.Star Cebu that the company is allocating $80 million to finance the additional 1.5 million metric tons capacity in its Naga plant this year as well as the expansion of terminals and improvement of distribution facilities.

According to Arcenas, it will add 40 percent to the total Cemex Philippines capacity.

The Naga plant expansion will come on stream by the second or third quarter this year.

Cemex Philippines has two production plants in Antipolo, Rizal and Naga, Cebu.

Asked about the company’s preparation for the Asean single market, Arcenas said they have been tracking the progress of the integration and they see the opening of the single economy both as a threat and as an opportunity.

Although cement production in the country and in other Asean countries is meant to fulfill the domestic demand, the opening of the single market will mean they will have to constantly upgrade products to remain competitive in the market.

Accessibility

On the other hand, Arcenas also said the integration will mean more market accessibility and that the flow of capital will translate to more projects that would spur more construction activities.

But even without tapping Asean neighbors yet, Arcenas said the Philippines is already a huge market for cement with other key provincial cities growing faster in Western Visayas, Mindanao and Northern part Luzon.

“We are hopeful that construction will continue to grow because this is the key to nation’s growth,” he said.

Amid the growth and opportunities, Arcenas identified energy price and availability as one of the challenges faced by the industry.

“The high cost of power and its limited availability is affecting the production and distribution of this energy-intensive venture,” he said.

INDIA: Low demand pushes down cement prices in Gujarat

Despite the ‘development’ plank in BJP’s Prime Minister candiate and Gujarat chief minister Narendra Modi’s electoral campaign, cement prices, a major commodity that gets used in the infrastructure sector, have not seen much upturn in Gujarat this year. For that matter, last quarter, prices in the Ahmedabad market were rather down by 10-13 per cent owing to slowdown in demand from end user industries like real estate and infrastructure.

A recent report on the cement sector from market research firm ICRA highlighted that while average wholesale cement prices have increased by 8-12 per cent in select markets like Delhi, Chandigarh in North and Mumbai in West between September to December 2013, prices have actually declined by 13 per cent in Ahmedabad during the same period.

Cement dealers, stockists as well as companies agree that prices are indeed down by 10-12 per cent owing to slow demand. Alok Sanghi, director, Sanghi Cement admitted that prices were down in the region owing to lack of demand from user industries. A senior company official informed that average price of cement during the fiscal has been around Rs 250 for a bag, and at present prices in the Ahmedabad region were hovering around Rs 290 a bag, which is down by 10-12 per cent on a year-on-year (yoy) basis.

V Srinivasan, cement analyst with Angel Broking said that average capacity utilisation of cement plants across the country is around 66 per cent at the moment, which is the lowest in the last three years.

Right ahead of the assembly elections in the state last year, the state government had announced that it would build affordable houses every year (around 25,000-40,000 houses per year) for the lower and middle income groups.

However, demand from the real estate sector has failed to pick up. A senior official of the Builders Association of India (BAI), Gujarat chapter claimed that real estate demand is down around 20 per cent in Ahmedabad region.

The ICRA report further pointed out that cement production has grown by a modest 3.7 per cent during April-December 2013 primarily due to weak demand from end-user industries.

“Delays in environmental clearances for industrial and infrastructure projects and sand unavailability in some states contributed to slow growth. Contrary to expectations, cement demand failed to pick up even in the post monsoon season due to continuing weak demand from infrastructure and real estate sector. . In fact, as against year-til-date (YTD) growth of 3.7 per cent the production registered an even lower growth of 2.0 per cent during Q3 FY14 despite a low base (cement production had grown by 5.5 per cent in the corresponding period last year),” the report elaborated.

Lower demand has, in turn, affected the margins of cement companies. Companies had raised prices in September 2013 in anticipation of recovery in demand post monsoons, however, the price rise had to be rolled back in October due to weak demand.

At the same time, input costs have risen.The Sanghi Cement official pointed out that rising diesel prices have indeed impacted freight costs for cement companies. Cement being a bulky commodity, freight costs constitute almost 30 per cent of overall operating variable costs. Srinivasan said, “While overall input costs have risen by Rs 100-150 per tonne, freight costs have gone up by Rs 40-50 per tonne.”

The total operating income for companies in ICRA Sample (includes ACC Limited, Ambuja Cements Limited, JK Cement Limited, JK Lakshmi Cement Limited, OCL India Limited, Prism Cement Limited, Shree Cement Limited, The India Cements Limited, The Ramco Cements Limited and Ultratech cement Limited) declined by 2.4 per cent yoy in Q3 FY14.

"The operating profitability margins for ICRA sample declined from 17.1 per cent in Q3 FY13 to 14.6 per cent in Q3 FY14. Muted demand, pricing pressures and cost headwinds resulted in muted performance of cement companies in nine months FY14. Companies in ICRA Sample reported 3 per cent yoy decline in revenues in nine months FY14. The operating profitability also declined from 21.8 per cent in nine months FY13 to 15.4 per cent in nine months FY14," the report claimed.

GHANA: GIPC signs €60m agreement with CIMAF for cement production

The government of Ghana has signed an agreement with the Ciments de l’Afrique (CIMAF Ghana Ltd) to construct a 60 million euro cement factory in Ghana.

According to the terms of agreement signed on Monday, March 3, 2014, the factory would be located close to the Tema Metropolitan Area.

Mrs. Mawuena Trebarh who represented the Minister of Trade, Haruna Iddrisu signed on behalf of government with Mr. Saad Sefrioui, General Director of Ciments de l'Afrique (CIMAF GHANA LIMITED) signing on behalf of his organization.

“CIMAF Ghana Limited plans to build a cement plant in the Republic of Ghana with a capacity of one million (1,000,000) tons per annum,” a letter of intent between the two institutions stated.

The agreement follows a recent meeting when President John Dramani Mahama received a delegation from the Moroccan Real Estate Group Addoha, led by Director General of the group, Saad Sefrioui.

Mr Sefrioui described the meeting with President Mahama as very good, and explained to journalists that the President showed a keen interest in the project.

Ghana has about 1.7 million housing deficit. According to Mr Sefrioui, this is something that needed all the necessary attention to overcome.

“That is why Addoha, which has an enviable track record in Africa, is determined to play a key role in addressing the problem,” he said.

The two parties therefore agreed on Monday that CIMAF will complete the building of the cement plant within 18 months. The company was charged to take account of local content and also work in accordance with domestic laws and regulations particularly those related to the protection of the environment.

Government is also expected to facilitate the acquisition of ten (10) hectares of land as well as a lease of limestone quarry.

The Ghana Investment Promotion Centre has embarked on a number of strategic moves recently to boost investment in the country whiles protecting local content.

According to Mrs. Mawuena Trebarh, the overriding goal is to create jobs and sustain economic growth.

Last year, Foreign Direct Investment (FDI) inflows to the country declined marginally by 19.53 percent to $3.946.41 million compared to almost $4,904.41 million recorded in 2012.

The Addoha Group, with a turnover of one billion euros, had been operating in 17 major cities in Morocco until two years ago when it started penetrating Africa south of the Sahara.

It has now established its presence in seven countries outside Morocco.

Mr Sefrioui said the Addoha Group was determined to make a strong impact on the economy of Ghana.

In doing that, he said, it was targeting low and middle-income groups who were in need of housing most.

And in supporting such groups to own their own houses, he said, the group would be maintaining its leadership role in real estate in Africa.

He also said the group’s presence in the production of cement would be so enormous that it would put a stop to the shortages the country sometimes faced.

QATAR: Cement prices not set for ‘unreasonable hikes’ on govt control

Though the demand for cement products is expected to almost double by 2017, any unreasonable price hike for the vital building material is unlikely due to the government’s tight control and monitoring of the market, a leading technocrat has said.

Engineer Khalid Kassas, general manager of Al Sarh Trading & Contracting Company, said current consumption of cement in the country is estimated at 5.5mn metric tonne per annum (mtpa). However, in the run-up to the Fifa World Cup 2022, this is likely to double to 10mn mtpa in the coming years.

Kassas said local producers are in a good position to meet increasing demand. If the need for importing cement arises in the future, neighbouring countries such as the UAE and Saudi Arabia could meet Qatar’s demands.

“It is a highly competitive market and local companies should come up with innovative solutions to cater to its various and varying needs. It could be considered a healthy sign in the market to encourage expansion and productivity, which is highly supported by the government,” he stressed.

Kassas said local companies in this field need to invest more to increase their production capacity and this is the proper time to make major upgrades for their facilities, including partnership with international players in the market.

“To keep our position, we have fully upgraded our new asphalt batching plant in Mesaieed Industrial City and fielding plant in Doha Industrial Area for concrete products. Also, our fleet of equipment and crushers has been completely enhanced and upgraded.”

Local producers should look ahead and adopt long-term investment strategies in terms of industrial assets such as machinery and equipment. They should also engage global experts to train their staff on how to operate these assets in a sustainable manner, Kassas said.

He pointed out that Qatar provides abundant contracting opportunities due to various mega projects, whether private or public, and to undertake these, local companies have to completely restructure their operations and be ready for constant upgrading.

Accompanying the construction boom is a very ambitious plan by Ashghal, the public works authority, to develop all the roads of the country and introduce more highways. Accordingly, Ashghal demands the integration of standard polymer asphalt blending system in most of the new projects that they are being implemented. The system is designed for fixed installations at facilities such as asphalt terminals. It blends poly (styrene-butadiene-styrene) or SBS, a hard rubber that is used where durability is important, with virgin asphalt cement, or bitumen, to make polymer-modified asphalt cement (PMAC).

“We are currently upgrading our system in our asphalt plant, incorporating the polymer modified bitumen system to cope with the demand from our clients,” Kassas said.

He said developing the human factor and workforce in such a process is essential.

“Maintaining a highly trained and qualified staff is key to success. We also do our best to care for our workers and labourers’ welfare, in particular providing them with adequate salaries, accommodation and related services,” he said.

Al Sarh Trading & Contracting Company was established in 1975 in Qatar. Currently it is a member of Mohamed Hayil Group of Companies.

COLOMBIA: Se mantiene la demanda de cemento

Los despachos del producto ascendieron a 806 mil toneladas durante enero, indicó el Dane.

En enero pasado, la producción de cemento en Colombia sumó 820 mil toneladas, que representaron un incremento de 2 por ciento en relación con el mismo mes del 2013.

Por su parte, los despachos ascendieron a 806 mil toneladas, un aumento de 1,1 por ciento.

Según el Dane, el alza en los despachos se explica, principalmente, por la dinámica en la distribución hacia las concreteras, los constructores y los contratistas, que en conjunto aportaron 3,4 puntos porcentuales al total, mientras que el canal de comercialización (almacenes, depósitos, etc.) cayó 4,8 por ciento y restó 2,5 puntos.

Por departamentos, Magdalena, con 37,6 por ciento, fue el más dinámico a la hora de demandar el insumo, seguido de Norte de Santander, 35,7 por ciento, y Cundinamarca, con 24,8 por ciento.

A estos se suma Antioquia, que reportó una variación de 7,6 por ciento. De esta forma, en conjunto todos aportaron 4,7 puntos porcentuales al total.

Por el lado de los que restaron a la tendencia, el Dane ubica a Córdoba (-50,9 por ciento) y a Bolívar (con -23,8 por ciento). Bogotá, que para efectos del informe incluye a Funza, Mosquera, Soacha y Chía, tuvo una variación de -4,8 por ciento.

Sin embargo, algunos analistas consideran que esta tendencia debería revertirse en el futuro inmediato, especialmente en los municipios, si se tiene en cuenta que se proyectan nuevas obras no solo en vivienda social, sino en otros usos.

El análisis de los últimos doce meses, hasta enero pasado, también registró incrementos, esta vez de 3,8 por ciento en la producción y de 3,9 por ciento en despachos.

ESPAÑA: El resultado neto de Cementos Molins se desploma un 77% en 2013

La venta de la uruguaya Cementos Artigas, la reducción de la contribución del negocio internacional y unos beneficios atípicos de 2012 que no se repitieron en 2012 desplomaron el beneficio neto de Cementos Molins en 2013. Ganó 10,1 millones de euros, un 77% menos. El reducción del beneficio fue mucho mayor que la de la cifra de negocios, que registró una caída del 9,4% y se situó en 832 millones de euros.

Los resultados de Molins vuelven a mostrar la continua caída del mercado de cemento en España (se contrajo un 19% en 2013), que el año pasado apenas ingresó en su propio mercado un 20% del total, tras sufrir otra disminución del 4,2% y pese a las exportaciones de clínker, que sí ha crecido. La facturación fuera de España también cayó un 10,6%, afectada por la venta de Artigas.

De hecho, la actividad de la compañía en España continúa estando en pérdidas. El Ebitda fue negativo en 12,73 millones de euros, mientras que las pérdidas fueron de 46,6 millones de euros, casi el doble que un año antes. En cambio, fuera de España, Molins ganó 56,75 millones de euros, un 17% menos.

El grupo explica en la información remitida a la CNMV que el mercado mexicano, el que mayor le reporta en negocio a través de Moctezuma, cayó un 12% en facturación (468 millones de euros ) a causa de la entrada de un competidor, lo que llevó a una reducción del Ebitda logrado en el país (153,8 millones, un 20,6% menos). En Argentina, su participada Cementos Avellaneda ingresó un 9,9% más (284,6 millones), pero los incrementos de costes y la depreciación del peso hicieron que el Ebitda cayera un 14,6%, hasta los 51 millones de euros. 

El endeudamiento neto del grupo se situó en 299,2 millones de euros, 16 millones de euros menos que en 2012. Las inversiones del ejercicio alcanzan los 70 millones de euros, entre los que se encuentran la adquisición a Cemex de una planta de fabricación de cemento de Sant feliu de Llobregat, cuyo interés es quedarse básicamente con su fondo de comercio.

MALTA: Danger of cement dust contamination

What does it take to get Michael Farrugia, the parliamentary secretary responsible for Mepa, and a doctor to boot, to react to the alarming news that the grain supplied by the Kordin Grain Terminal runs the serious risk of being poisoned by cement dust?

In September 2013, Flimkien għal Ambjent Aħjar brought to Mepa’s attention the fact that a cement silo was being built without a permit two metres away from the terminal’s grain conveyor belt, raising concerns on health risks through contamination of grain by cement.

We asked if any enforcement action was being taken.

We were told by Mepa: “As of this afternoon, the silo is still being constructed and is definitely not in operation. There is hence nothing more to add from an enforcement perspective.”

So serious is the risk of the grain being contaminated that the Environmental Health Directorate ordered both the cement silo owners and the grain importers to prepare risk assessments.

The first report by doctors Julian Mamo and John Paul Cauchi, on behalf of Kordin Grain Terminal, had very grave concerns on the serious risk to the public, especially children, of poisoning of the grain by even minute amounts of cement. Their conclusions are that it is not an acceptable risk irrespective of how safe the silo is.

The second, authored by Cali Corleo for UC Ltd, cites the possibility of the grain being subject to contamination from the cement dust “even following the application of best practices”.

FAA submitted a formal complaint to Mepa and three reminders, which included the newer health risk information. All are still unacknowledged.

We also wrote to the parliamentary secretary but, disappointingly, other than supporting Mepa’s enforcement and management’s lack of responsibility and “directing us“ to investigate, we have received neither a satisfactory answer nor direct action.

PAKISTAN: Cement sector seeks relief

Cement manufacturers have asked the Federal Board of Revenue (FBR) to exclude cement from the “Third schedule” of Sales Tax act.

In case the said procedure continues, fixation of maximum retail price (MRP) must be allowed on the basis of two different zones in the upcoming budget of 2014-2015.

In a letter to the FBR chairman, All-Pakistan Cement Manufacturers Association said dynamics of every province and region are different, therefore, collection of sales tax on the basis of single MRP across the country is anomalous which would ultimately force manufacturers to restrict sales only to nearby markets.

It added that this would mean stopping sales to the far-flung areas where there are increased chances of parallel market getting established which would impede FBR’s revenue collection.

As an alternative, cement industry proposes a zone based maximum retail price as it will save consumers of nearby areas from paying excessive amount while protecting manufacturers from incurring losses on cement sales in remote areas.

In a letter, the association asked the FBR to introduce uniform tax rate for corporate sector besides some other measures in the upcoming budget for the year 2014-15.

Cement is one of the most taxed industries of the country and is currently subject to various taxes including Corporate Income Tax — 34pc of taxable income; Minimum tax: 1pc of Turnover (in case of losses; Withholding Tax — Multiple and cross withholding; FED — Rs400 per tonne; and Sales Tax — 17pc of the maximum retail price.

The association also proposed step wise abolishment of FED, which amounts to Rs400 per tonne to encourage cement off-take.

Cement industry is subjected to 17pc GST, imposed on MRP instead of ex-factory, which is comparatively very high from the global rates.

The reduction of GST to 12.5pc will encourage the registration of unregistered taxpayers to avail benefits of input adjustments.

The cement industry is experimenting with different options for reducing fuel cost by using alternative energy resources such as pet coke and shredded rubber tires to enhance its competitiveness in the global market. Therefore, the government should reduce the duty on alternative fuels to zero per cent as has been the case with coal, from current 5pc and 10pc of ad valorem.

APCMA has also suggested that the 50pc rate of initial allowance on plant and machinery be restored from the current 25pc which in turn would result in gearing up investment in BMR and capacity enhancement of existing industries.

It further proposed that withholding tax rate on import of raw material, spares, stores and capital goods by industrial undertaking for its own use be reduced from 5pc to 1pc.

APCMA proposed that 210 days should be set for filing duty drawback claims which were not accepted by the Customs Department pertaining to the period July 2005 to June 2011 due to unavailability of original Afghan Customs documents.

NIGERIA: Lafarge Invests €1bn in Cement Production

Lafarge Country Chief Executive Officer (CEO) Nigeria and Benin Republic, Mr. Guillaume Roux, has said that the company has invested more than €1 billion (about N214 billion) in the country since 2008, adding that an additional €1billion would be injected to double its operational capacity within the next three to four years.

He said Lafarge had through the years earned a reputation for products of impeccable quality and differentiated itself through innovation, value adding services and contribution to industrialisation of the country. He said plans are underway to double the number of plant it currently has in the country.

Speaking at an interactive session with journalists in Abuja, Roux, who is also the company's Group Executive Vice-President said going forward, Lafarge planned to deploy various innovative solutions which are tailored and adapted for the Nigerian environment with a view to addressing customers' varying needs.

He said it intends to make a big difference in the industry by having a nationwide coverage with a strong push to develop the people boost their economic power.

Specifically, he said there are plans to install construction development laboratories to cater for different solutions for different types of customers.

He also said there are ongoing plans with the ministry of works and housing to promote the use of concrete for road construction in the country.

He said:"We are keen at supporting the industrialisation of the country and region in which we operate."

He noted that efforts had been made to development the country's human capacity by ensuring 98 percent of staff are Nigerians.

Lafarge is a French industrial company specialising in four major products including cement, construction aggregates, concrete and gypsum wallboard. It is currently one of the leading private sector companies which is sponsoring Nigeria's centenary celebrations.

"We want to bring different solutions to our customers, we are not just selling cement powder, we are selling products and solutions for different types of customers," he said.

Reacting to allegations that the increasing incidence of building collapse in the country due to the prevalence of substandard cement products, Roux, while regretting the trend however argued that building collapse has no direct bearing to quality of cement.

Notwithstanding, he said Lafarge puts quality control at the forefront of its operation stressing that "we have a high quality cement with is consistent with local and international standard."

Rather, he blamed the collapse of buildings on the misapplication of building materials and low level of construction education adding that cement manufactured in the country are of international standard and best practice.

He said it had been proven globally that cement has no direct link with building collapse, adding that there was the need for enhanced education programme on proper usage or cement application.

Control of construction is also key to stopping collapse buildings.

Roux said:"Cement quality is not cause of building collapse, this has been proven internationally. What causes building collapse is related to the way concrete is being made; the way the materials are being applied; Andy designs of buildings that could be faulty. Those are the main causes of building collapse that is why we are focusing on the education and training of our people."

He further noted that the control of construction activities was also key to stopping buildings collapses.

According to him, among other initiatives, Lafarge is currently working out modalities for giving training to block makers on usage of cement in relation to other building materials.

He said the company would continue to work with the works and housing ministry to help more people understand the benefits of complying to set standards.

He said the current policy of backward interest anion in the industry had been a success by helping to create more jobs and better products and innovation as we'll as stability in the environment leading to decrease in price of cement to the benefit of consumers.