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Logistics, much to achieve

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The Indian cement companies spend around 18 per cent of their operating income on logistics, both inbound and outbound. Top 30 cement companies spent more than Rs 10,000 crore to carry cement to the consumer in 2009-10 while the industry has been continuously making efforts to reduce logistic costs. The recent downtrend in cement business, which saw profit margins shrink to 20-25 per cent from 35-40 per cent, made cement makers refocus on logistics management. And this proved beneficial to many manufacturers.

Using more railway routes than roads, shrinking lead distance and opting for sea-routes wherever possible were some of the measures the industry explored. Currently, for every 50-kg bag of cement, the logistics cost comes to around Rs 18-25 by road and Rs 12-15 by railway, depending on the distance. The average cost of carrying cement by railways has also gone up over the years. From Rs 95 per tonne km in 008-09, the cost has almost touched Rs 100 in 2010-11. Road freights are determined by multiple factors, including the principle component, diesel. Thanks for the administered prices of this fuel, road transportation is a viable option up to a lead of 300 km. Above that, railway is economical. Sea route is limited largely on the western coast, where the draft is enough for bulk transportation. Worldwide, 70 per cent of the cement movement is by sea compared to just 1-2 per cent in India.

The cement industry believes that reducing logistic costs in isolation is not achievable, without considering the serviceability of the system. Large cement makers are focusing on an appropriate mix of the two. Efficiency and technology can make a large difference to cement logistics. Mechanisation (in road transportation) is the key that can make a huge difference to cement logistics. But this needs a collaborative effort and no company can solely take this forward.

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Concrete

Holcim UK drives sustainable construction

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Holcim UK has released a report titled ‘Making Sustainable Construction a Reality,’ outlining its five-fold commitment to a greener future. The company aims to focus on decarbonisation, circular economy principles, smarter building methods, community engagement, and integrating nature. Based on a survey of 2,000 people, only 41 per cent felt urban spaces in the UK are sustainably built. A significant majority (82 per cent) advocated for more green spaces, 69 per cent called for government leadership in sustainability, and 54 per cent saw businesses as key players. Additionally, 80 per cent of respondents stressed the need for greater transparency from companies regarding their environmental practices.

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Concrete

GCCA releases LCR system

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The Global Cement and Concrete Association (GCCA) has launched the Low Carbon Ratings (LCR) system for cement and concrete, a new global rating based on products’ carbon footprints. The system uses a clear AA to G scale to help customers prioritise sustainability in material selection across construction sectors worldwide. The GCCA says that the LCR system is designed to be easily recognisable, with a simple visual graphic that indicates a product’s rating and provides consistency and comparability to other products.

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Concrete

FLSmidth opens eco-friendly plant in Casablanca

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FLSmidth has inaugurated a €21 million mill liner manufacturing plant in Casablanca, covering 11,250m² with a production capacity of 6,500 tonnes annually. The LEED-certified facility significantly reduces carbon emissions by up to 56 per cent and fully recycles water used in the manufacturing process. Up to 250 jobs will be created in the Valparaíso region. Mikko Keto, CEO, highlighted the plant as a symbol of FLSmidth’s commitment to sustainable mining and community engagement in South America. Earlier in 2024, the Denmark-based company announced plans to sell its cement division to sharpen its focus on mining operations.

 

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