HONG KONG (XFN-ASIA) - Asia Cement (China) Holdings (743.HK), the mainland unit of Taiwan's Asia Cement Corp, has priced its initial public offering (IPO) in Hong Kong at 4.95 hkd per share, near the low end of an indicated price range of 4.85-6.45 hkd, according to a market source.
The retail tranche of the IPO has been four times subscribed, the source said.
Based on the offer price of 4.95 hkd, the company could raise 1.86 bln hkd from the sale of 375 mln shares.
The shares will begin trading on May 20.
Expect this Cement stock to trade up to 8.00 HKD minimum on Tuesday. Good luck Traders!
Sunday, May 18, 2008
Wednesday, September 19, 2007
World Cement Report: Now to 2020
World consumption of cement is forecast to continue to increase throughout the next 15 years, taking the annual volume up from the 2283mt of 2005 to around 3130mta by 2015, and 3560mta by 2020, representing overall forward expansion of approximately 56%
According to the 203-page Report "GLOBAL CEMENT to 2020"*, world production and consumption of cement approximated 2283mt in 2005, this level representing an increase of approximately 5.75% (124mt) on the previous year, and a continuation of the annual underlying expansion which has seen year-on-year growth in almost every year since the 1970s. In tonnage terms, the past half-decade witnessed a global expansion of 633mt, with almost 70% of this overall growth (440mt) coming from East Asia alone, with 76mt from other Asian countries. Other regional expansion includes 7mt for C/S America, 44mt for Africa/Middle East, 48mt for Europe, and 20mt for North America. The volume of cement entering world trade has traditionally been low relative to overall production and consumption - typically accounting for approximately 6-7% in aggregate terms (6.8% in 2005). This is linked to the low unit value of cement, the widespread availability of raw materials, and the link between economic growth and cement consumption - all these factors favouring domestic production rather than import dependence. Trade volumes have risen almost continuously over the past 35 years, advancing from 20mta in 1970 to 71mta by 1990 and a 2005 total of 155mt. Most recently, year-on-year growth approximated 7.7% in 2004 and almost 6% in 2005 – linked to US import growth, but also supported by high volume trade within Europe, the Middle East, and Asia. This trade growth – summing 19mt (14%) in 2 years – occurred against a background of unprecedented increases in shipping costs. Within the latest trade total, finished cement trade approximated 107.2mt, with approximately 47.6mt of clinker moved internationally. There has been a shift towards greater significance for clinker within the trade aggregate recently – linked to a number of factors, largely market-specific, as well as to the increased involvement of the multinationals in cement capacity ownership throughout the world. On a regional basis, 2005 saw totals of 37mt imports and 47mt exports for Europe - including high volumes of intra-European trading (often non-seaborne). Within Asia, S/E Asia and E Asia account for a high share of world exports (15.5% and 23% respectively in 2005), although exports from SW Asia (mainly India) have increased in recent years. Elsewhere, North America (USA) is a major import market, whilst Africa and the Middle East play a significant role in both world exports and imports.For future cement markets, there are very different forward patterns of growth expected for individual regions. Thus, for the main individual regions total forward growth ranges from 1% for North America to over 70% for SW Asia and parts of Europe, and to over 90% for SE Asia. At the global level, 5-year expansion is expected to approximate 19.75% in 2005-10, slowing to 14.5% in the next half-decade and 13.75% in 2015-20. Above average growth is anticipated for SE Asia and SW Asia in each of the halfdecades, with growth approximating 29%, 23.5% and 19.25% respectively for the former. Cement demand in Africa is also expected to be above average in each period, with halfdecade performance of over 21% growth for 2005-10, slowing to 13.8% in 2015-20. A similar profile is recorded for Latin America, whilst for North America, the dominance of the US in the regional profiles dictates a net advance of almost 13.5% in 2005-10, but a contraction of 6.4% and 4.5% in the subsequent half-decades. Growth in the EU 15 is also expected to be well below the world average, whilst for Other Europe the growth performance is expected to approximate over 25% in 2005-10, slowing to 14.7% in 2015-20.Of the total 1280mt forecast increase in world cement consumption, over 72% is set to occur in Asia – with volume increases of 710mt for East Asia, 109mt for SW Asia and 111mt for SE Asia.The Study includes a set of alternative forward scenarios :-In the Low Case, the world cement consumption aggregate is projected to grow only marginally in the near-term, followed by more significant growth thereafter. The global total is projected to reach over 2440mt by 2010, and 2995mta by 2020 - representing overall forward expansion of just over 31%.In the High Case, the profile is somewhat different, in that average annual expansion is expected to be relatively high over the near/medium-term, slowing thereafter. In tonnage terms, this translates to a projected level of around 3075mta by 2010, rising to 4220mta by 2020. Total forward growth approximates 85%.The development of future cement trade volumes will continue to be dominated by essentially short-term import requirements, set against an underlying background of clinker import dependency and other long-term supply patterns. Trade volumes will remain highly susceptible to cost and availability factors, with any major shift in shipping costs being of potential primary significance in this regard, as witnessed in the past 2-3 years. The continuing consolidation of the cement industry at the global level – in terms of capacity ownership by the cement majors – will continue to act as a restraint on imports in some markets and will encourage trade in others. The very nature of the cement trade suggests continued significant year-on-year volatility for individual markets and potentially at the aggregate trade level throughout the study period. This will continue to be exacerbated by any major movement in shipping costs through bulk carrier freight rates.In 203 pages, the highly detailed and extensive new report contains analysis of cement production, consumption, imports & exports for individual countries throughout the world. The Report includes detailed forecasts of developments throughout the period to 2020, and is essential reading for all parties with an interest in the future development of the cement industry.
According to the 203-page Report "GLOBAL CEMENT to 2020"*, world production and consumption of cement approximated 2283mt in 2005, this level representing an increase of approximately 5.75% (124mt) on the previous year, and a continuation of the annual underlying expansion which has seen year-on-year growth in almost every year since the 1970s. In tonnage terms, the past half-decade witnessed a global expansion of 633mt, with almost 70% of this overall growth (440mt) coming from East Asia alone, with 76mt from other Asian countries. Other regional expansion includes 7mt for C/S America, 44mt for Africa/Middle East, 48mt for Europe, and 20mt for North America. The volume of cement entering world trade has traditionally been low relative to overall production and consumption - typically accounting for approximately 6-7% in aggregate terms (6.8% in 2005). This is linked to the low unit value of cement, the widespread availability of raw materials, and the link between economic growth and cement consumption - all these factors favouring domestic production rather than import dependence. Trade volumes have risen almost continuously over the past 35 years, advancing from 20mta in 1970 to 71mta by 1990 and a 2005 total of 155mt. Most recently, year-on-year growth approximated 7.7% in 2004 and almost 6% in 2005 – linked to US import growth, but also supported by high volume trade within Europe, the Middle East, and Asia. This trade growth – summing 19mt (14%) in 2 years – occurred against a background of unprecedented increases in shipping costs. Within the latest trade total, finished cement trade approximated 107.2mt, with approximately 47.6mt of clinker moved internationally. There has been a shift towards greater significance for clinker within the trade aggregate recently – linked to a number of factors, largely market-specific, as well as to the increased involvement of the multinationals in cement capacity ownership throughout the world. On a regional basis, 2005 saw totals of 37mt imports and 47mt exports for Europe - including high volumes of intra-European trading (often non-seaborne). Within Asia, S/E Asia and E Asia account for a high share of world exports (15.5% and 23% respectively in 2005), although exports from SW Asia (mainly India) have increased in recent years. Elsewhere, North America (USA) is a major import market, whilst Africa and the Middle East play a significant role in both world exports and imports.For future cement markets, there are very different forward patterns of growth expected for individual regions. Thus, for the main individual regions total forward growth ranges from 1% for North America to over 70% for SW Asia and parts of Europe, and to over 90% for SE Asia. At the global level, 5-year expansion is expected to approximate 19.75% in 2005-10, slowing to 14.5% in the next half-decade and 13.75% in 2015-20. Above average growth is anticipated for SE Asia and SW Asia in each of the halfdecades, with growth approximating 29%, 23.5% and 19.25% respectively for the former. Cement demand in Africa is also expected to be above average in each period, with halfdecade performance of over 21% growth for 2005-10, slowing to 13.8% in 2015-20. A similar profile is recorded for Latin America, whilst for North America, the dominance of the US in the regional profiles dictates a net advance of almost 13.5% in 2005-10, but a contraction of 6.4% and 4.5% in the subsequent half-decades. Growth in the EU 15 is also expected to be well below the world average, whilst for Other Europe the growth performance is expected to approximate over 25% in 2005-10, slowing to 14.7% in 2015-20.Of the total 1280mt forecast increase in world cement consumption, over 72% is set to occur in Asia – with volume increases of 710mt for East Asia, 109mt for SW Asia and 111mt for SE Asia.The Study includes a set of alternative forward scenarios :-In the Low Case, the world cement consumption aggregate is projected to grow only marginally in the near-term, followed by more significant growth thereafter. The global total is projected to reach over 2440mt by 2010, and 2995mta by 2020 - representing overall forward expansion of just over 31%.In the High Case, the profile is somewhat different, in that average annual expansion is expected to be relatively high over the near/medium-term, slowing thereafter. In tonnage terms, this translates to a projected level of around 3075mta by 2010, rising to 4220mta by 2020. Total forward growth approximates 85%.The development of future cement trade volumes will continue to be dominated by essentially short-term import requirements, set against an underlying background of clinker import dependency and other long-term supply patterns. Trade volumes will remain highly susceptible to cost and availability factors, with any major shift in shipping costs being of potential primary significance in this regard, as witnessed in the past 2-3 years. The continuing consolidation of the cement industry at the global level – in terms of capacity ownership by the cement majors – will continue to act as a restraint on imports in some markets and will encourage trade in others. The very nature of the cement trade suggests continued significant year-on-year volatility for individual markets and potentially at the aggregate trade level throughout the study period. This will continue to be exacerbated by any major movement in shipping costs through bulk carrier freight rates.In 203 pages, the highly detailed and extensive new report contains analysis of cement production, consumption, imports & exports for individual countries throughout the world. The Report includes detailed forecasts of developments throughout the period to 2020, and is essential reading for all parties with an interest in the future development of the cement industry.
Monday, September 10, 2007
Serious Shortage of Cement in Nigeria
NIGERIA: The Minister of Commerce and Industry, Mr Charles Ugwu, has in Abuja predicted that demand for cement in the country will rise to approx. 17 million tonnes in 2008.
“Unfortunately, as of today, only about four million tonnes are being produced locally, though production will push up to about seven million tonnes with the new capacity being built.
Ugwu, who gave these figures at a meeting with stakeholders in the industry said: “Yet a deficit of about 10 million tonnes of cement is recorded”.
He said government would allocate the shortfalls to investors in the downstream sector to import.
“Blending of the cheap imported clinker with the locally manufactured cement will allow Nigerians to enjoy better prices, “ he said.
He said the meeting was a working session where every stakeholder had an opportunity to explain specific problems of the sector to address both supply and price issues.
“I have read the files and heard the situation in the industry, the president has called me and said the situation must change rapidly,” Ugwu said.
The Minister said government was aware of the agony faced over road transportation and other logistics, adding that the president was committed to seeing major improvements in the provision of vital infrastructure.
“But the president has expressed a great deal of anxiety that in every commodity where government has intervened to support local manufacturers, things have always turned for the worse, rather than getting better.”
“When we look at sugar, cement, flour and other areas where government had tried to restrict import in order to give fair opportunities for local manufacturers, prices have skyrocketed, “ he added.
He said noticeable shortages had developed in a way that could make one question the logic of the incentives that were given.
“Everyone here has the responsibility to ensure that the supply is good, regular, adequate and that prices are fair, so that both the consumer and supplier will have fair returns.
“Unfortunately, as of today, only about four million tonnes are being produced locally, though production will push up to about seven million tonnes with the new capacity being built.
Ugwu, who gave these figures at a meeting with stakeholders in the industry said: “Yet a deficit of about 10 million tonnes of cement is recorded”.
He said government would allocate the shortfalls to investors in the downstream sector to import.
“Blending of the cheap imported clinker with the locally manufactured cement will allow Nigerians to enjoy better prices, “ he said.
He said the meeting was a working session where every stakeholder had an opportunity to explain specific problems of the sector to address both supply and price issues.
“I have read the files and heard the situation in the industry, the president has called me and said the situation must change rapidly,” Ugwu said.
The Minister said government was aware of the agony faced over road transportation and other logistics, adding that the president was committed to seeing major improvements in the provision of vital infrastructure.
“But the president has expressed a great deal of anxiety that in every commodity where government has intervened to support local manufacturers, things have always turned for the worse, rather than getting better.”
“When we look at sugar, cement, flour and other areas where government had tried to restrict import in order to give fair opportunities for local manufacturers, prices have skyrocketed, “ he added.
He said noticeable shortages had developed in a way that could make one question the logic of the incentives that were given.
“Everyone here has the responsibility to ensure that the supply is good, regular, adequate and that prices are fair, so that both the consumer and supplier will have fair returns.
Thankfully, restrictions on importing cement have now been lifted. Yes Mr. President...stop meddling. Closing down factories DOES NO GOOD.
Friday, September 7, 2007
Temporary Measures in Malawi Cement Imports
MALAWI: Über Cement producer Lafarge Portland says it will investing $75-million in a new limestone-mining project at Chenkumbi Hills, in Malawi’s southern district of Machinga. The cement manufacturer, which has been importing clinker and gypsum from Circle Cement, of Zimbabwe, says it is moving fast to start production at the Chenkumbi mine as soon as possible because the continuing economic crisis in Zimbabwe is leading to “unstable prices and a shortage of the raw materials”. “The situation looks grave,almost irreperable, and there are no signs of an immediate solution. We are not even sure whether the clinker that trickles from Zimbabwe will continue and suffice for an average monthly requirement of 17 000 MT" says Lafarge Portland Malawi commercial manager Nesta Msowoya. Lafarge Portland started importing clinker from Zimbabwe in November 2002, when it closed its Changalume limestone mine after a survey had revealed that the mine no longer had enough commercially mineable deposits. Msowoya says dwindling supplies of clinker from Zimbabwe have obliged them to start importing from China.“This decision is also not at all favourable because it has increased landed costs by 38%, thereby leading to a 14% cement price hike by the company,” explains Msowoya .He says Lafarge is fast-tracking the development of the mine at Chenkumbi so that it becomes operational in 2009. Meanwhile, the Malawi government has removed restrictions on the importation of cement, which it put in place in 2000, after Lafarge Portland and Shayona Cement complained about “unfair” competition posed by cheap imports from Zimbabwe. Malawi’s Trade and Industry Minister, Ken Lipenga, says the government has removed the restrictions owing to the current shortage of cement.“The shortage of cement in the country has come at a time when there is a lot of construction work(think World Cup Infrastructure). We have, therefore, resolved to open the gates to anyone who wants to import cement into the country.“This implies that importers will no longer have to seek licences to import cement. It should be noted that this is only temporary measure, which will be reviewed once the situation gets back to normal,” says Ken Lipenga. A bit unusual.
Friday, August 24, 2007
A Little Cement Education for the Future Cement Trader
1. Don't Start By Sourcing Your Cement on Alibaba. Alibaba can be a great resource but there are too many jokers/losers wanna be cement agents lurking there. All the cement prices you see there are far too low.
2. There is a Cement Shortage EVERYWHERE. Europe is short cement, Africa is short cement. This is your basic first economics class: low supply + high demand = high cost.
3. Cement from China can be obtained...again be wary of the con...and you never know: there is a lesson to be learned from the lead laden Barbie doll story. Get a good contact on the ground that speaks your language.
4. The price of cement itself at the factory door may not be expensive...but did you think a cement carrier was cheap? Easy to get your hands on? They aren't fueled by thin air. The cost of such a vessel varies daily as well.
Lesson Over
To be Frank: I don't earn my keep from this blog. I trade commodities (especially cement) and I represent a few Chinese cement factories. I am happy to give further assistance. Post a message if you want. I don't post my email here anymore. There is too much junk that lands in my inbox when I do.
2. There is a Cement Shortage EVERYWHERE. Europe is short cement, Africa is short cement. This is your basic first economics class: low supply + high demand = high cost.
3. Cement from China can be obtained...again be wary of the con...and you never know: there is a lesson to be learned from the lead laden Barbie doll story. Get a good contact on the ground that speaks your language.
4. The price of cement itself at the factory door may not be expensive...but did you think a cement carrier was cheap? Easy to get your hands on? They aren't fueled by thin air. The cost of such a vessel varies daily as well.
Lesson Over
To be Frank: I don't earn my keep from this blog. I trade commodities (especially cement) and I represent a few Chinese cement factories. I am happy to give further assistance. Post a message if you want. I don't post my email here anymore. There is too much junk that lands in my inbox when I do.
Thursday, August 23, 2007
Not All Ports Are Deep Enough for Cement Carriers
This is what happens when the port isn't deep enough. Cement is offloaded onto barges.
Tuesday, August 21, 2007
Why Nigerian Cement Prices Won't Crash Anytime Soon
NIGERIA: Over a month ago construction experts predicted a cement price crash in Nigeria when President Umaru Musa Yar'Adua yesterday ordered the re-opening of Ibeto Cement Factory in Port Harcourt, Rivers State.
This was considered a major step to break the oligopoly enjoyed by some cement manufacturers and importers.
The factory was shut down by former president, Chief Olusegun Obasanjo, allegedly to protect the interest of his allies in the cement industry.
The chairman of the re-opened company, Chief Cletus Ibeto, has pledged to flood the market with quality cement in the next forty days, saying this would result in the crashing of price of cement.
40 days ago cement prices in Nigeria ranged from USD12.00 to USD 15.00 per bag depending on the location in the country. Today, when the ships were supposed to come in, prices range from USD20.00 to USD25.00 per 50 kilo bag.
The destruction of local efforts of manufacturing cement was predicted by the president of the Manufacturers Association of Nigeria (MAN), Alhaji Bashir Borodo. This seems a bit farfetched as prices have continued to go up and the demand for cement is estimated at over 13 million metric tonnes P.A....
Ibeto says they can roll out 1.5 million tonnes PA ( just over 10% of what is needed)
Local production, can at best, handle 10 million tonnes PA...so Nigeria will still be short at least 1.5 million tons. We don't see any price relief about to happen especially with shipping costs set on a firm upward trend and neighbouring countries with high cement demands and shortages on the horizon unless one of the following happens:
1. Ibeto increases capacity and imports more
2. Other cement importers are allowed to reopen (do they exist?)
3. nnnmm don't have one.
So, Chief Ibeto ( I want that name), What gives? It's your turn. Make some hay while the sun is shining (considering that CIF USD125.00 per MT could be achieved CIF if you were in touch with the right people)
Happy to help.
This was considered a major step to break the oligopoly enjoyed by some cement manufacturers and importers.
The factory was shut down by former president, Chief Olusegun Obasanjo, allegedly to protect the interest of his allies in the cement industry.
The chairman of the re-opened company, Chief Cletus Ibeto, has pledged to flood the market with quality cement in the next forty days, saying this would result in the crashing of price of cement.
40 days ago cement prices in Nigeria ranged from USD12.00 to USD 15.00 per bag depending on the location in the country. Today, when the ships were supposed to come in, prices range from USD20.00 to USD25.00 per 50 kilo bag.
The destruction of local efforts of manufacturing cement was predicted by the president of the Manufacturers Association of Nigeria (MAN), Alhaji Bashir Borodo. This seems a bit farfetched as prices have continued to go up and the demand for cement is estimated at over 13 million metric tonnes P.A....
Ibeto says they can roll out 1.5 million tonnes PA ( just over 10% of what is needed)
Local production, can at best, handle 10 million tonnes PA...so Nigeria will still be short at least 1.5 million tons. We don't see any price relief about to happen especially with shipping costs set on a firm upward trend and neighbouring countries with high cement demands and shortages on the horizon unless one of the following happens:
1. Ibeto increases capacity and imports more
2. Other cement importers are allowed to reopen (do they exist?)
3. nnnmm don't have one.
So, Chief Ibeto ( I want that name), What gives? It's your turn. Make some hay while the sun is shining (considering that CIF USD125.00 per MT could be achieved CIF if you were in touch with the right people)
Happy to help.
Monday, August 20, 2007
Italcement Extends It's Reach
Italcementi SpA has just made an offer to buy 51 percent of Kuwait's Hilal Cement Company in a move that would expand the reach of Italy's largest cement maker to 21 countries.
The offer of US$2.60 per share, which was made through Italcementi's Egyptian subsidiary Suez Cement Company, values the company at US$89 million (€66.15 million). It has been approved by the Kuwait Stock Exchange.
Italcementi recently bought the Fuping Cement in China as part of its strategy to grow in emerging countries.
Hilal has a capacity to produce about 1 million metric tons of cement a year, and in 2006 had revenues of around US$65 million.
The offer of US$2.60 per share, which was made through Italcementi's Egyptian subsidiary Suez Cement Company, values the company at US$89 million (€66.15 million). It has been approved by the Kuwait Stock Exchange.
Italcementi recently bought the Fuping Cement in China as part of its strategy to grow in emerging countries.
Hilal has a capacity to produce about 1 million metric tons of cement a year, and in 2006 had revenues of around US$65 million.
If You Are or Want to Be a Cement Trader You Must Have These
It's one thing to Trade...but you really trade so much better if you know what you're talking about. Read these or at least keep them on your book shelf, seriously:
Lea's Chemistry of Cement and Concrete, Fourth Edition
Cement Chemistry, second edition
Lea's Chemistry of Cement and Concrete, Fourth Edition
Cement Chemistry, second edition
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