EEUU: Cement company hit with $350,000 fine

CalPortland violated air standards at plant in Marana, EPA says

A major Arizona cement manufacturer will pay a $350,000 fine for reportedly violating federal air-quality regulations.

The deal between CalPortland Co. and the U.S. Environmental Protection Agency claims that the company did not obtain the proper permits for major modifications it made last year in its operations at its plant near Marana.

According to the EPA, the changes resulted in a significant net increase in coarse particulates.

But the fine, which EPA air-enforcement officer Doug McDaniel said is on the "high side" of those imposed by his agency, is only part of the deal. It also requires the company to choose between two options designed to reduce future pollution.

One involves CalPortland completing construction of what EPA calls a new "state-of-the-art" kiln in the next 42 months.

At that point, the company would have to shut down operation of four older kilns.

If the company does not want to go ahead with the new kiln, it is required to upgrade the pollution-control equipment on its existing kilns.

"That's a decision they have to make," said McDaniel.

Company Vice President Scott Isaacson said that question remains undecided.

"We're obligated to make that decision very promptly after the (federal) court has done its work and there's public comment on this," he said.

Isaacson said the issue surrounds plans by the company to make changes in its operation, changes that required a permit from the federal agency.

"The permit was issued by EPA based upon faulty information we provided," he said. That erroneously issued permit allowed the company to increase its pollution beyond what would have been allowed had CalPortland provided the EPA with the correct information.

"This settlement will result in cleaner air for communities affected by the CalPortland facility," Deborah Jordan, director of the EPA's Air Division for the Pacific Southwest region, said in a prepared statement.

"To safeguard the public health, all cement plants need to be properly permitted and keep their air emissions within the limits set by federal law."

Isaacson said CalPortland is glad "to have this matter behind us."

According to the EPA, cement kilns emit coarse dust and dirt which can cause major health problems.

Those include impaired breathing, lung damage, cancer and premature death.

The agency says that the elderly, children and people with chronic respiratory problems are particularly sensitive to such pollution.

The consent decree, which was filed in U.S. District Court in Tucson, also includes possible additional penalties.

The company could pay up to $37,500 a day for exceeding applicable standards.

INDIA: Builders will take to streets over cement price

CHENNAI: Protesting against the unprecedented 100% hike in the price of cement in the last one month, builders across the state have decided to stage a one-day strike on Thursday and take out a rally from the Rajarathinam Stadium in Egmore to the state secretariat. 

At a joint press meet on Wednesday, Confederation of Real Estate Developers' Association of India(CREDAI) Tamil Nadu chapter president T Chitty Babu and Builders' Association of India (BAI) past president Radhakrishnan said that though the builders would shut down operations on the day the workers would be paid salary. The hike in the prices of cement and other raw material had already hit the construction sector badly. "The cost of construction has gone up by about 40% in less than two months and almost 40% of works across the state have come to a halt," said Chitty Babu. 

Meanwhile, builders from Tamil Nadu, Goa, Maharashtra and Karnataka have come together to import cement from Pakistan, Iran and Ukraine. A group of builders from Kerala has already brought 20 containers of cement from Pakistan, each weighing 20 tonnes, to Cochin port. While domestic brands cost Rs 290 to Rs 300 per 50 kg bag, Pakistan cement's landing cost at Cochin port was only Rs 190 a bag, said CREDAI national vice-president Prakash Challa. 

Recently, the ICICI Bank published a report saying cement manufacturers had cut down production by 30-50%. It had resulted in an artificial scarcity of the commodity in the market, builders pointed out. 

The Tamil Nadu government, with a view to reining in the cement lobby and insulating the government-sponsored Kalaignar housing scheme from the effects of the price hike, was initially interested in joining hands with builders in importing cement. It also said it would buy cement from other states. But it later backtracked after the cement lobby assured the government that it would supply cement at Rs 210 per bag for all government-sponsored schemes.

AFRICA: Nigeria: Dangote Cement Lists 15.5 Billion Shares On NSE

Dangote Cement Plc, on Tuesday, listed its 15,494,019,668 billion ordinary shares of 50 kobo each at N135.00 per by way of introduction on the floor of the Nigerian Stock Exchange (NSE). The demand for the shares superceeded the 100 million shares that was offered for sale as investors demanded close to 200 million shares.

In his remark at the listing ceremony, the NSE Interim Administrator, Mr. Emmanuel Ikazoboh said the listing will add N2.1 trillion or 25 per cent to market capitalisation of the Exchange, adding that the event was historic because it is the biggest issue by a single company to be listed on the NSE.

According to Ikazoboh," History is made today in the anal of the nation's capital market with the listing by Introduction of Dangote Cement Plc's entire Issued Share Capital of 15.5 billion Ordinary Shares of 50k each at N135.00 per share"

Ikazoboh disclosed that the development will boost investors confidence on NSE, urging Nigerian entrepreneurs to come and take advantage of the market by listing their companies on the Exchange.

"I am also calling on those companies that undertook private placement few years back and promised to list their shares on the Exchange after the exercise, to come and do so as the market is eagerly awaiting them"

However, he congratulated the president of Dangote group, Alhaji Aliko Dangote for his unwavering belief in the nation's stock market, stressing that he has singularly contributed more than any Nigerian to the growth and development of the market. "In 2008,10 billion Ordinary Shares of Dangote Sugar Plc was listed on the Exchange at N18 per share; this was followed in 2008 with the listing of Dangote Flour Plc's five billion Ordinary Shares at N15.00 per share. Both companies have remained investor delight ever since", he said.

In the same vein Aliko Dangote said this is the first stage, promising that the company will continously improve on corporate governance in tandem to global practice.

Dangote noted that investors interest will be protected, adding that no additional trade will be made till the next 18 months before any sales can be made. According to him: "The proposed merger is conceived with the goal of consolidating the cement producing entities of Dangote Industries Limited in Nigeria under a single entity presenting a robust platform for the enlarged DCP to optimize on available growth. opportunities having regard to the present state of the Nigerian cement industry.

This is expected to significantly increase production capacity, boost turnover and profitability and eventually lead to an enhanced dividend payout and capital appreciation for the investors." "Our reason for listing any of our companies is to take care of shareholders. So far we have given dividend of over N23 billion this year," he said.

INDIA: Buy Ambuja Cements; target of Rs 142: Anand Rathi

Anand Rathi Securities is bullish on Ambuja Cements and has recommended buy rating on the stock with a target of Rs 142, in its October 21, 2010 research report.

"Ambuja’s net profit declined 44% Y-o-Y, lower than our and consensus estimates. Decline in realizations and increase in power & fuel cost led to the drop. We estimate CY11 earnings to be strong, driven by recent price recovery, savings on clinker purchase and strong volume growth."

"Realisation fell 10% Y-o-Y and 6% Q-o-Q to ~Rs 3,595/ton. Cement dispatch volumes rose 7% Y-o-Y to 4.35 million tons (down 19% Q-o-Q). Domestic volumes increased 7.6% Y-o-Y, while exports declined 32% Y-o-Y."

"EBITDA/ton, at Rs 650, fell 39% Y-o-Y and 42% Q-o-Q mainly due to a drop in realisations. The benefit of lower raw material cost (down ~ Rs 300/ton Y-o-Y due to no clinker purchases) was offset by higher power & fuel cost at Rs 1,025/ ton (up ~ Rs 265/ton due to higher clinker production and fuel prices). ‘Other expense’ at Rs 780/ton (up ~Rs 100/ton) increased due to higher maintenance and selling & distribution cost."

"New clinker units at Chhattisgarh and HP have achieved 50% utilisation levels. Two grinding units (Maratha & Bhatapara) will commence by 4QCY10, taking capacity to 27m tons. A transporters’ strike at its HP plants (3.1m tons) since 7th Oct, stalled production and dispatches. Ambuja expects demand to pick up towards the yearend. It expects medium-term demand and realisations to improve."

"At our target price of Rs 148, the stock would trade at 7.5x CY11 EV/EBITDA, in line with its ten-year average. The target price implies a PE of 14x CY11 and an EV/ton of USD 160," says Anand Rathi Securities research report.

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AFRICA: Egypt: Suez Cement nine-month net profit dips 8.5 pct

Egypt's Suez Cement (SUCE.CA) posted an 8.5 percent fall in nine-month net profit to 906.7 million Egyptian pounds ($157 million), the company said on Thursday.

Suez, Egypt's largest listed cement company and a subsidiary of Italcementi (ITAI.MI), said its consolidated net sales in the period fell 2.1 percent to 4.69 billion pounds while operating income slipped 10 percent to 1.256 billion pounds.