GRIND

PLUG
/ eoenga/
www.plugandgrind.com
www.cemengal.com
The Plug&Grind

has arrived
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May 2013
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CONTENTS
Palladian Publications Ltd
15 South Street, Farnham, Surrey, GU9 7QU,
ENGLAND
Tel +44 (0)1252 718999
Fax +44 (0)1252 718992
Email: mail@worldcement.com
Website: www.worldcement.com
T
h
is m
o
n
th
s
fro
n
t co
v
e
r
www.worldcement.com
Years of
Innovation
imsa, Turkey, reviews the
companys milestones and
priorities on the occasion of its
40th anniversary.
Introduction
imsa, the leading cement company in Turkey, has
recently celebrated its 40th year in the business and today
the company is able to provide customers with a range
of products, including calcium alimunate cement, grey
cement, white cement and ready-mixed concrete.
Forty is an age in which you feel younger and stronger,
but also have the experience of years. imsa feels the same,
said imsa's GeneraI Manager, Mehmel HacikmiIogIu,
during an event to celebrate the anniversary.
He continued: Many public opinion surveys are
conducted every year. According to these surveys,
Sabanci group is always the most trusted company and
imsa is among the creators and inheritors of this trust.
The nature of our existence is to give customers the
highest quality service possible. We try to reinvigorate
the economy by producing the best quality cement and
providing employment, all the time being conscious of our
environmental and social responsibility.
40 years of achievements
In its 40-year history, the company has celebrated a
number of achievements, including the following:
The Mersin plant is the largest white cement plant in
the world, at 1 million t capacity under one roof.
imsa is the worlds third biggest white cement
producer.
Turkeys biggest global player in cement since 1990,
today imsa exports to more than 50 countries.
The company has the biggest ready-mixed cement
production network in Turkey.
For many years, imsa has been among Turkeys top
100 companies in the corporate tax list.
Innovation has been the basis for imsas success.
It won ISIDA 40s Golden Plumb award and the
Europe Green Certificate with its CEM IV product.
| 27 26 |
26
FEATURED ARTICLES
Introduction
How can one take care of a business second by
second whilst travelling around the world? In the
21st century doing so has become a fairly simple
reality; smart phones, laptops, etc., can be used
to stay on top of sales activities, stock controls
and buying services, for example, but this tends
to be linked to activities on the commercial side
of business. Would it be possible to manage other
activities remotely, such as a cement storage
plant? For Euromecc, the answer was yes. The
company studied how to provide a full turnkey
solution that would allow customers to always
be tuned with their storage system, in order to
manage loading, unloading and all such processes
related to the various cement delivery phases.
Eng. Daniele Sciuto, Euromecc S.r.l., Italy,
discusses the installation of a cement
storage plant with minimal operator and
driver involvement.
| 77
77
GRIND
PLUG / eoenga/
www.plugandgrind.com
www.cemengal.com
The Plug&Grind

has arrived
May 2013
Volume 44: Number 5
May 2013 ISSN 0263 6050
May 2013
WORLD CEMENT REGULARS
[07] Comment
[09] News
[17] Keynote: Global Trading Patterns
Imran Akram, IA Cement Ltd, UK, examines developments in
international cement trade.
[99] Product News
[104] 15 Facts...
REGIONAL REPORT: TURKEY & MENA
[26] 40 Years of Innovation
imsa, Turkey, reviews the companys milestones and
priorities on the occasion of its 40
th
anniversary.
[31] Turkeys Growing Market
Bulent Kolanci, ABB in Turkey, examines Turkeys cement
sector and discusses a supply contract for the largest greenfield
cement project in the country.
[37] Bulk Materials Handling Across the MENA
Region
Pietro de Michieli, Bedeschi SpA, Italy, details several projects
from across the Middle East and North Africa.
COVER STORY
[40] A New Market Solution
Angel Martin and Moises Nuez, Cemengal, Spain, present
the Plug&Grind

, an alternative solution for cement grinding

and packing, with an introduction from Dario Del Frate,
General Manager of Cemengal.
A complete cement grinding
and packing station, assembled
exclusively with European
components, shrunk to fit eight 40ft.
containers and able to produce up
to 100 000 tpa of standard OPC or
60000 tpa of slag. It is delivered
FOB seven months after purchase
and it can be moved.
World Cement
[May 13] | 3
95
81
[Turn to
page 55]
At present, the German
cement industry obtains
more than 60% of its
need for thermal energy
from waste and waste-
derived fuels...
CONTACTS
Managing Editor James Little
james.little@worldcement.com
Editor Katherine Guenioui
katherine.guenioui@worldcement.com
Editorial Assistant Louise Fordham
louise.fordham@worldcement.com
Production Natalie Callow
natalie.callow@worldcement.com
Advertisement Director Rod Hardy
rod.hardy@worldcement.com
Advertisement Manager Ian Lewis
ian.lewis@worldcement.com
Advertisement Executive Paul Heyworth
paul.heyworth@worldcement.com
Website Editor Callum OReilly
callum.oreilly@worldcement.com
Circulation Manager Victoria McConnell
victoria.mcconnell@worldcement.com
Subscriptions Laura Cowell
laura.cowell@worldcement.com
Reprint/Marketing Assistant Catherine Gower
catherine.gower@worldcement.com
Publisher Nigel Hardy
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reserved. No part of this publication may be reproduced,
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Uncaptioned Images courtesy of www.bigstockphoto.com
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CONTENTS
31
May 2013
LIME
[51] The Lime Industry
World Cement explores developments in the
international lime industry.
ALTERNATIVE FUELS
[55] Seeking Permission
Dirk Lechtenberg, MVW Lechtenberg & Partner,
Germany, provides further information about
environmental regulations and emission limits
in this excerpt from the Alternative Fuels and Raw
Materials Handbook for the Cement & Lime Industry,
updated according to the latest developments in
this area.
SOFTWARE
[65] Picking Up the Pace
Olaf Streit, Aucotec AG, Germany, outlines a new
solution that simplifies the tendering process in
plant construction.
MATERIALS HANDLING & STORAGE
[71] Heart of Steel
Marco Taddio, SIG SpA, Italy, considers the
advantages provided by rubber conveyor belts with a
fabric-like steel core.
[77] Intelligent Cement Storage
Eng. Daniele Sciuto, Euromecc S.r.l., Italy, discusses
the installation of a cement storage plant with
minimal operator and driver involvement.
[81] Stacking and Stockpiling
Carl Donnelly, Telestack, UK, outlines three case
studies from around the world.
[85] From Design to Execution
Martin Wuerth, Wuerth Consulting Engineers,
Switzerland, presents a case study on a multi-
compartment silo project at Jura Cement in
Switzerland.
[88] Bagging & Packing Round-Up
Product and project news for bagging and packing
technology in the cement industry.
World Cement
[May 13] | 5
Now its time for our grinding technology. For further information please call
+49 211 53 53 0 or visit www.loesche.com
ACCORDING TO OUR RESEARCH, THIS
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World Cement
[May 13] | 7
May 2013
EDITORS
COMMENT
The explosion
at a fertiliser
plant in West,
Texas last month
was a stark reminder of the
dangers industrial workers
face and contain every day. Details of the cause of
the explosion in Texas were not available at the time
of writing; such an investigation will take weeks
possibly months as firefighters comb the wreckage
for clues. One report, however, has speculated that a
failed pressure release valve might be at the root of the
problem. Pressure in the ammonia tank, heated by the
fire, should never have been allowed to build as it did,
ultimately causing the enormous explosion that left
14 people dead and at least 200 injured. Whatever the
cause, questions will be asked just as they would be
at a cement plant. Why did the valve fail? Why did no
one notice it was failing? What could have been done to
prevent the fire, the explosion, the fatalities?
At the recent IEEE-IAS/PCA Conference in
Orlando, Florida, a comment was made to the effect
that some US cement producers have been neglecting
maintenance work because of the current environmental
and economic conditions. Given the dangerous nature
of the cement production process, a failure to address
maintenance concerns is a failure to address safety.
Katherine Guenioui, Editor
katherine.guenioui@worldcement.com
[17]
Imran Akram gives an overview of Global Trading
Patterns in this months Keynote.
[55]
Dirk Lechtenberg examines the intricacies of Seeking
Permission to burn alternative fuels.
[31]
An overview of Turkeys Growing Market from
Bulent Kolanci, ABB.
[88]
Project and product news in this Bagging & Packing
Round-Up.
Another topic high on the conference agenda
was training. Skills shortages are a massive
problem in the US and worldwide (see the
Editors Comment, March 2013). Its a combination
of an ageing workforce, the difficult economic
environment which has resulted in a massive loss
of talent through restructuring programmes and
a lack of newcomers to the industry. If plants are
operating with under-skilled or insufficient staff,
performance will obviously suffer. So will safety.
In an industry this size, already facing a less
than positive public profile, safety failures cannot
simply be absorbed into the ether of these things
happen. From both a personal and business
perspective, a safety breach is unacceptable. Zero
harm is the only goal. Of course, this isnt news,
but when you have been working the same job
for a while it is easy to let complacency take hold
and safety can slip from consciousness. Safety
posters fade into the background, safety talks blur
into meaninglessness, and horror stories become
just that: stories. How can we make sure that this
doesnt happen? I would love for you to share your
ideas, your philosophies and whatever is working
for you on our Linked In page. Find it through
our website at www.worldcement.com. The cement
industry has long been a leader in innovation; lets
make it a safety leader, too.
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World Cement
[May 13] | 9
May 2013
WORLD
NEWS
Fives FCB finalises license agreement
with FCT ACTech
Loesche wins VRM contract from
Holcim Ecuador
Pakistan sees 22.79% increase in
exports
To read more
about these
articles go to:
Scan for the
WORLD CEMENT
iPhone/iPad App
Get the free mobile app at
http:/ / gettag.mobi
Stanam Industries, which designs and manufactures
equimenl lhal faciIilales lhe slorage, lhe free oving,
conveying and cleaning of powdery and bulk products, has
established a new site in the US. The inauguration of the
site took place on 6 February 2013 in Tampa, Florida.
Close to a motorway junction, the site is well connected
and can supply its customers in a very short time: indeed,
a storage space is dedicated to minimise lead times.
Cuslomers in lhe IS and Lalin America viII benehl from
the proximity with the warehouse, as well as improved
storage capacity and the number of parts available.
For industries in various sectors such as mining or
quarrying, cement or incineration plants, it is essential
that sites are safe for all employees. At the same time,
environmental regulations regarding dust emissions are
becoming stricter. Stanam Industries provides equipment
to ensure plants can comply with these regulations.
In the US, Cemex required products from Stanam
Industries to solve dust problems at its site. The cement
company was facing spillages at transfer points on
conveyor belts and considerable loss of product. After
extensive technical studies, the customer was convinced of
lhe benehls of a LIITIL inslaIIalion lo secure ils sile.
The LIITIL

is a patented system that optimises the

sealing property of any conveyor belts. It is standard and
easy to install on new or existing conveyors: a removable
hood hls on a cenlraI roIIer lo ensure lhe reduclion of
dust emissions. This product is also available in different
versions, such as high temperature or large width, so it
can hl any conhguralions. Nov 8O m of high lemeralure
LIITIL have been inslaIIed al lhe Cemex Ianl,
providing positive results. The conveyors (underground
and external) are totally secured and loss of product has
been signihcanlIy reduced.
ThyssenKrupps two engineering subsidiaries
ThyssenKrupp Polysius and ThyssenKrupp
Frdertechnik have merged as part of the groups
strategic development programme. Combined, they
will now be known as ThyssenKrupp Resource
Technologies. The new company will supply the
cement, mining, bulk materials handling and mineral
processing industries, providing single-source
expertise on areas such as design and consulting,
[USA] A new site for Stanam Industries
[Germany] ThyssenKrupp Polysius merges with ThyssenKrupp Frdertechnik
engineering and project management, construction,
installation, as well as after-sales service, R&D and plant
hnancing.
ThyssenKrupp Resource Technologies has
approximately 5500 employees and annual sales of
around e2 billion. The management board comprises
Ramsis Shehala (CL), Chrislof revka (service
business), Heike Iranke (CI), Marlin HiIbig (CHR)
and Lothar Jungemann (cement business).
28 July 2 August 2013
11
th
International Conference on
Mercury as a Global Pollutant
Edinburgh, Scotland
www.mercury2013.com
10 13 September 2013
UNITECR 2013
Victoria, BC Canada
www.unitecr2013.org
25 27 September 2013
7
th
International VDZ Congress
Dsseldorf, Germany
www.vdz-congress.org
8 10 October 2013
12
th
TMB International Technical
Seminar and Exhibition
Antalya, Turkey
www.tcma.org.tr/Technical_Seminar
11 13 November 2013
18
th
Arab International Cement
Conference and Exhibition
Jordan
www.aucbm.org
19 22 November 2013
13
th
NCB International Seminar on
Cement and Building Material
New Delhi, India
www.ncbindia.com
World Cement
[May 13] 10 |
May 2013
WORLD
NEWS
In a consortium with KHD,
Loesche has won an order
for two vertical roller mills
for ACC/Holcim. The
VRMs are to be installed
at the Jamul plant in India
where some clinker will
be ground in the cement
plant and some will be
processed in grinding
terminals. An LM 56.3+3 with a capacity of 195 tph will be used
for lhis urose. Il is equied vilh an LDC lye cIassiher and
a 5600 kW motor. The mill will also be able to grind slag. The
second VRM is an LM 43.4 D, which has a capacity of 90 tph and
a 1300 kW gearbox.
Loesche will also provide additional equipment, which will
be delivered as part of a joint venture between Loesche GmbH,
Dsseldorf, and Loesche India Pvt. Ltd.
PT Holcim Indonesia
Tbk. has awarded
ThyssenKrupp Resource
Technologies the contract to build a second
cement plant near Tuban, Java. The plant is due
to commence production in 2015. The contract,
which is worth approximately US$250 million, is a
follow-up to Holcims Tuban 1 plant. This plant is
also being constructed by ThyssenKrupp Resource
Technologies and is scheduled to start operating
in June 2013. The companys scope of supply for
both projects includes state-of-the-art equipment
covering raw material preparation, clinker
production, cement loading and fuel preparation,
as well as the installation of a POLB laboratory
automation system for quality monitoring and
control. Each plant will have a production capacity
of 1.7 million tpa.
[Indonesia]
ThyssenKrupp Resource
Technologies to
construct second Tuban
plant
[India] Loesche to
supply two VRMs to
Jamul plant
[Sri Lanka] Thatta Cement to build cement plant at Sri Lankan port
The Sri Lankan subsidiary of Thatta Cement Company Ltd, Pakistan, has signed a Business Venture Agreement with the
Sri Lanka Ports Authority for the construction of a cement grinding, storage and packing plant. The plant will be located at
Magam Ruhunupura Mahinda Rajapaksa Port and will include a closed circuit cement grinding mill. It will have an initial
cemenl roduclion caacily of 1OO OOO la, vhich viII be increased lo 1 miIIion la over lhe hrsl 1O years of oeralion. The
Business Venture Agreement spans 25 years.
With more than 250 complete plant-wide electrical, control and infrastructure solutions
installed in over 45 countries, ABBs experience in cement, mining and mineral processing
industries started more than 50 years ago. As a single source supplier, we ensure the
selection of the right technologies and solutions, their correct dimensioning, compliance
with environmental conditions as well as the implementation of industry dedicated smart
solutions. All of this leads to maximizing your plants availability and reducing energy
consumption adding up to substantial capital savings. For more information, visit us at
www.abb.com/cement
Main Technology Center for electrical,
control and instrumentation systems
5405 Baden 5 Dttwil, Switzerland
minerals@ch.abb.com
Substantial capital savings?
Absolutely.
World Cement
[May 13] 12 |
May 2013
WORLD
NEWS
[Turn to page 17]
Imran Akram examines
developments in global
cement trade.
[Asia] FRITZ & MACZIOL wins order for
Holcims Tuban plant
Holcim has awarded FRITZ & MACZIOL a contract to
install the VAS logistics solution at the Tuban cement
plant in Indonesia. The order follows the introduction
of VAS al hve HoIcim Ianls in Indonesia. Ior lhe nev
order, FRITZ & MACZIOL Asia is working with the
SAP Competence Center in Bangkok, with whom it had
reviousIy coIIaboraled for lhe ro|ecls in lhe IhiIiines,
as inlegralion inlo lhe cenlraI SAI syslem of lhe HoIcim
Grou is an imorlanl arl of lhe Tuban ro|ecl. The VAS
syslem al lhe Indonesian Ianl viII be imIemenled in lhe
Bahasa language.
The comany is aIso execling furlher orders in
Indonesia, ThaiIand and Myanmar. Due lo demand in lhe
region, lhe InduslriaI AIicalions & Services Division
has set up a separate team at FRITZ & MACZIOL Asia
in Manila. To begin with, the team will include two
deveIoers and a lechnicaI saIes emIoyee vho viII be abIe
lo Iook afler IocaI cuslomers onsile as veII as roviding
24-hour support to European VAS users.
[UK] Cemex UK recognised for its fleet
operations
Cemex IK has achieved
Gold Status in Transport
for Londons Fleet
Operators Recognition
Scheme. The voIunlary
cerlihcalion scheme
recognises eel oeralions
in lhe cily lhal meel vilh
the required standards
related to lawfulness,
safely, efhciency and
lhe environmenl. More
than 1900 companies are
invoIved in lhe inilialive.
Cemex has been a
member since 2008 and is
one of |usl 1O comanies
lo achieve GoId Slalus.
The cement
manufacturer has a
eel of 3OO cemenl and
aggregales vehicIes lhal
cover 15 miIIion miIes a.
In 2O11 il began lo deveIo a nev slralegy for lyres,
examining vays lo reduce vasle, lesling olimum lyre
soIulions for ils range of vehicIes and imroving fueI
efhciency. Afler carrying oul heId lriaIs in ils cemenl eel,
Cemex has inlroduced ConlinenlaI Iov roIIing resislance
lyres on a roIIing rogramme across ils enlire eel of
vehicIes. The lriaIs found lhal lhe lyres cul C
2
emissions
by more lhan 3 la er vehicIe, as veII as Ieading lo fueI
savings and a Ionger Iifesan.
[Africa] Bricking Solutions forms
partnership with the Dickinson Group
ricking SoIulions and lhe Dickinson Grou have |oined
in arlnershi lo rovide lheir combined exerlise in
refraclory inslaIIalion, demoIilion and refraclory reIaled
installation equipment. A smelter and mineral processing
furnace conlraclor based in Africa, lhe Dickinson
Grou seciaIises in lhe execulion of lurnkey furnace
ro|ecls, refraclory roducls and inslaIIalion services.
The comany's Rolary KiIn Division carries oul rolary
kiIn ro|ecls, moniloring and hol aIignmenl services for
the cement and lime, iron, ferrochrome, paper and pulp
industries.
SICK Process Automation Division
United States - Houston | Minneapolis | 281-436-5100
Canada - Toronto | Calgary | 855-742-5583
www.sicknorthamerica.com | information@sick.com
Low Maintenance Mercury Monitoring
Mercury monitoring for compliance and process control applications requires precise analyzer
technology that is designed to minimize maintenance costs and increase availability. The
MERCEM300Z from SICK was designed to meet the challenges of continuous mercury
monitoring without daily or weekly maintenance. Its patented technique of simultaneous mercury
conversion and measurement ensures accurate results (high temperature converter transforms
Hg compound into measurable elemental Hg at approximately 1,830
o
F). The innovative Zeeman
measurement technique offers low cross sensitivities and no mechanical parts to exchange. Field
tested maintenance intervals of greater than 4 months. Complies with Performance Spec 12A.
Next Generation Mercury Monitoring
MERCEM300Z.
SICK is your single source provider for emissions monitoring and process control: in-situ
and etractive gas analysis dust monitoring ow measurement and plant wide monitoring
systems. See our additional products at www.sicknorthamerica.com.
VDMA is opening a representative office in Sao Paulo,
Brazil, which will be headed by Thomas Junqeira Ayres
Ulbrich. With the establishment of this new site, VDMA
will be represented with its own offices in all of the
BRIC countries.
Thermoteknix Systems Ltd has received ISO 9001
certification for its Quality Management System.
UK-based Instarmac Group plc has been recognised by
The Times annual Top 100 Best Small Companies to
Work For. This is the fourth time that the company has
been featured on the list. It was placed at number 64,
its highest ranking to date.
CalPortland Company has been awarded the 2013
Energy Star

Sustained Excellence Award by the

US Environmental Protection Agency. This is the
ninth consecutive year that the company has been
recognised with an EPA Energy Star Award at national
level, the last seven of which have been for Sustained
Excellence.
World Cement
[May 13] 14 |
May 2013
WORLD
NEWS
[Worldwide] Industry appointments
Wahl Refractory Solutions has announced a number of
new appointments. Angela Rodrigues-Schroer has taken
up the role of Director of Research and Development,
Gilles Mercier will serve as Industrial Sales and
Marketing Manager and Thomas Roloson has been
appointed as Vice President of Sales.
A TEC GRECO has announced that Peter Schwei has
been appointed as Sales and Technical Managing Director,
supporting Torsten M. Offtermatt in the management
team. He will take up the post from 3 June 2013, and will
be based in Gdersdorf, Carinthia.
Christoph Voutsinas has joined A TEC as Global
Sales Manager. He will be based in the companys
head ofhce in Krems, Auslria, and viII be resonsibIe
for the coordination of sales activities of A TEC and
A TEC GRECO worldwide.
Adriano Greco has left A TEC GRECO, resigning
his operative functions in Brazil but remaining
as a shareholder in the company. He has joined
Gebr. Pfeiffer, Inc. as Sales Director for the South
American market.
Dr Juergen Pankratz has been appointed as the
Direclor of lhe Verder Scienlihc Division, arl of lhe
Verder Group.
Cimpor has appointed Francisco Saudade e Silva
Lopes Sequeira as Deputy Company Secretary.
Cemex registered a 27%
alternative fuel substitution rate
for cement manufacture in 2012.
[Europe] Verder Scientific Division
expands
The Dutch Verder Group has widened its product
portfolio to include high-temperature material testing and
physiochemical analysis, in addition to its laboratory and
analytical technology.
The Scienlihc Division of lhe lechnoIogy grou Verder
has expanded to include Endecotts Ltd, Eltra GmbH and
Carbolite Ltd. Retsch and Retsch Technology have been
lhe core of lhe Scienlihc Division for many years. LIlra,
which specialises in elemental analysis of organic and
inorganic maleriaIs, is nov Iocaled in lhe same ofhce as
Retsch in Germany. The latest acquisitions and inclusion
of lhe comanies under lhe umbreIIa of Verder Scienlihc
will help the Verder Group to strengthen its position as a
supplier of system solutions for sample preparation and
the analysis of solids.
[USA] Cemex signs research agreement
for alternative fuels study
Cemex has signed a collaboration agreement with the
Earth Engineering Center (EEC) at Columbia University
and City College of New York, USA. A year-long study
will be carried out that will research the life cycle effects of
alternative fuel use in cement production. It will focus on
waste combustion technologies that have been introduced
in Cemex kilns in the US and Mexico, and aims to enhance
understanding of the role that alternative fuels play in both
society and the environment. Professor Nickolas Themelis
of Columbia University and Professor Marco Castaldi of
the City College of New York will lead the investigation.
Cemex registered a 27% alternative fuel substitution
rate for cement manufacture in 2012 and is on target to
reach a 35% fuel substitution rate by 2015. Since 2005, the
company has invested over US$175 million into adapting
its production process and installing equipment in order to
use alternative fuels in its cement kilns.
burning for
1980, Kogushi Okinoyama, Ube city, Yamaguchi Prefecture 755-8633 Japan
Tel: +81-836-22-6293, Fax: +81-836-22-6489
Website: http://www.ubemachinery.co.jp/ E-Mail: umc_mill_m@ube-ind.co.jp
UBE VERTICAL MILL| Search
[Imran Akram], IA Cement Ltd, UK,
examines developments in international cement trade.
Introduction
Cement trading represents a small but vital part of our
industry. According to our estimates, total cement trading
accounts for around 3% of total cement volumes. It
performs the vital role of allowing surpluses and shortages
to be ironed out across countries. After declining 20% from
peak, pre-credit crunch levels, trading volumes began to
improve in 2012 and we anticipate a further increase in
2013.
In 2011 we estimate that 130 135 million t of cement
was moved across borders with the following breakdown:
Around one-third was moved by truck or barge across
countries sharing a border.
Circa two-thirds was seaborne cement.
The seaborne trade was split approximately between
clinker (25%), bulk cement (60%) and bags (15%).
Cement trading peaked in 2007, when we estimate
lhal lolaI voIumes surassed 16O miIIion l. Trading ovs
have dropped in recent years, and become more local/
regional. There have been two major changes worldwide.
First, there has been a sharp reduction in US imports after
the bursting of its housing bubble. Second, the Chinese
have cut exports considerably as the government phased
oul smaII, inefhcienl Ianls and removed subsidies on
exported cement. Other large import markets have seen
sharIy Iover ovs due lo faIIing demand (Sain) or nev
capacity (several countries in the Middle East).
Cemenl is lyicaIIy a difhcuIl roducl lo lransorl, being
a low-value bulky item. It accounts for only 3% of the overall
shipping market. Trade is heavily concentrated in the smaller
Handysize and Handymax vessels. Its dusty nature also means
that shipowners typically prefer to carry other products. The
low-value nature of the product also gives other commodities
an edge in competing with cement as a cargo. Steel and its
inputs account for around half of global trade.
Prices
Figure 2 and Table 1 give our estimates for export prices
(clinker, free-on-board) and regional pricing trends in the
last 15 years. The last three years have seen some interesting
changes among the leading exporters. Vietnam and the UAE
have emerged as major exporters while traditional exporters
like Indonesia/India have cut back volumes on the back of
strong domestic demand.
FOB export prices dropped US$3 in 2012, due to concerted
pressure from Vietnam, the UAE and Spain in the second
half of the year. We expect these countries to increase exports
and cause a further slight price drop in 2013. This marks a
reversal of the steady increase in prices from 2010 11, when
prices increased by a total of US$9. Energy costs were the key
upward driver behind this move.
Lven accounling for generaI inalion, cemenl rices
have risen sharply in several regions in the last 15 years.
These include Europe, the US, India and Africa. In our
view one driver of this trend has been growing industry
May 2013
KEYNOTE
| 17
World Cement
[May 13]
consolidation. Prices in China, the Far
East and MENA remain low. In contrast,
selling prices remain elevated across
Latin America and Sub-Saharan Africa.
Shipping rates plummeted in 2012,
as shown in Figure 3. The Baltic Dry
fell almost 40% in 2012 and stands at
just 880 at the time of writing. Much
of this downward pressure was due to
slower Chinese growth, coupled with
a surge in capacity of larger vessels.
The declines would arguably have been
even greater, had it not been for port
congestion, which typically has 5 8% of
the shipping industry tied up at any one
point in time. The smaller Handymax/
Handysize vessels that dominate the
cement market have been less volatile.
Nevertheless, shipping rates touched
very low levels in 2012 and have
dropped further in the early part of 2013.
USA and China two sides of
the same coin?
In 2006, cement trading in the US and
Chinese markets surged to 36 million t
each. The US imported this amount on the
back of the housing bubble, while China
exorled lhe same hgure as ils caacily
spiked dramatically. Figures 4 and 5 show
the development of US imports over the
last 12 years and the country comparison
between 2006 and 2012.
US cement and clinker imports have
averaged 20 million t in the 2000 2012
period. After the 2006 peak of 36 million t,
imports dropped to a trough of 6.4 million t
in 2011 with a small
pickup to 7 million t in
2012. During this same
time period, US cement
consumption declined
by over 50 million t.
Chinese exporters
have borne the brunt
of this decline, with
Chinese exports to the
US dropping from over
10 million t in 2006 to
less than 0.5 million t
last year. Canadian
exports have held up as
the multinationals have
integrated operations
Figure 2. Clinker FOB, US$/t. (Source: IA Cement Ltd.)
Figure 1. Dry bulk cargoes by product. (Source: IA Cement Ltd.)
Other
18%
Forest Products
5%
Grain
11%
Steam Coal
18%
Coking Coal
8%
CEMENT
3%
Iron Ore
29%
Steel
8%
K
o
rea
20
25
30
35
40
45
50
C
hina
Thailand
Japan
M
alaysia
Taiw
an
Turkey
V
ietnam
S
pain
Table 1. Regional average selling prices, US$
Cement prices US$/t
1997 2012
Western Europe 66 95
Eastern Europe 36 85
US 75 93
LatAm 102 107
China 39 52
India 40 110
Far East 68 79
MENA 58 67
Sub-Saharan Africa 100 145
Source: IA Cement Ltd
U
A
E
May 2013
KEYNOTE
18 |
World Cement
[May 13]
in North America and have always
used Canadian production to supply
the US market. All other major
exporters have seen a sharp drop in
US sales.
In time, we expect the US
import market to come back
strongly. We expect demand to
recover and surpass previous peaks
on the back of demographic growth
and the continued normalisation
of housing and commercial
construction markets. On the
supply side, capacity remains
subdued with the NESHAP
regulations pressuring old plants.
Construction of new plants
remains very difhcuIl due lo sliff
environmental opposition.
Looking at supply sources, we
would expect Canada to remain
an integrated part of the US
market. Mexican exports will also
increase as demand in the southern
states recovers. Countries such
as Thailand, Sweden and Brazil
are unlikely to resume large-scale
exports as their domestic markets
are absorbing more cement. Greece
and South Korea are likely to remain
long-term suppliers due to their
overcapacity, notwithstanding the
anli-duming suil hIed by TXI. We
also expect new suppliers to emerge
from the Mediterranean, with Spain
at the forefront, supplemented by
Egypt and France.
While US cement imports
have dropped from 36 million t to
7 million t, Chinese exports have
dropped by almost the same
amount, reaching a trough of
1O miIIion l. We execl a al
development in 2013.
The drivers of the Chinese
export decline have been rather
structural in nature:
The government decided in
2006 to discourage exports on
the grounds that producing
this extra cement was
consuming a lot of coal and
electricity, was damaging to
Figure 5. Top 10 US importers, 2006 vs 2012. (Source: USGS.)
Figure 4. US imports 2000 2014E. (Source: IA Cement Ltd, USGS.)
Figure 3. Baltic Dry Index. (Source: IA Cement Ltd, Bloomberg.)
9000
8000
7000
6000
5000
4000
3000
2000
1000
0
1991 1994 1997 2000 2003 2006 2009 2012
10000
5
10
15
20
25
30
35
40
0
2000 2001
Imports (mt)
2002 2003 2004 2005
China
Canada
Thailand
Korea
Mexico
Taiwan
Greece
Colombia
Venezuela
Sweden
Peru
Brazil
Others
2006 (35.6Mt) 2012 (7Mt)
0 2 4 6 8 10 12
2006 2007 2008 2009 2010 2011 2012 2013E 2014E
May 2013
KEYNOTE
20 |
World Cement
[May 13]
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