Process

Past, present & future trends in AFR

Published

6 years ago

January 4, 2019

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Cement industries can certainly play a key role in promoting better waste management practices and create a win-win situation by working with urban local bodies on waste segregation and management of municipal solid waste.

The Indian cement industry, as indicated by CII, is second largest in the world, it has set voluntary and ambitious emission reduction targets to reduce 45 per cent of its carbon emissions intensity by 2050 from the 2010 levels. As one of the global leaders in energy efficiency, the Indian cement industry has also committed to reduce 377 – 485 PJ of energy in 2050 compared to BAU scenario. This is a clear testimony on how the Indian cement industry is keen to make a difference.

Moreover, the Government has committed to reduce emissions intensity of its Gross Domestic Product (GDP) by 33 to 35 per cent by 2030 from 2005 level. The cement industry, being one of the major contributors to the Indian economy, can play a vital role in supporting the nation in its low carbon pathway.

Carbon emissions
The potential to reduce emissions from cement is significant, since a 1 per cent increase in thermal substitution rate (TSR) will result in reduction of 2-3 kg CO reduction/ tonne of cement.

It has been proven beyond any doubt that, in a cement kiln, the organic constituents of fuel are completely destroyed and the inorganic constituents combine with the raw materials and exit as part of the cement clinker without generating solid residues, thus providing the best solution for waste management. The use of alternate fuels and raw materials reduces carbon emissions that result from using fossil fuels and reduce the overall environmental impact of cement manufacturing process.

As rightly indicated by CII, Indian cement industry has been steadily progressing in AFR substitution over the years. There had been remarkable changes in last 10 years on this subject of AFR in India. The thermal substitution has shown a very positive trend year on year, though at a very slow pace earlier and picking up later in last two to three years to a level of around 4-5 per cent. If you look at the volumes of waste used, the Indian cement industry is fourth in the world with use of 1.6 million tonne (MT), with Germany being the highest with 3.1 MT, followed by North America with 2.2 MT and the US with 1.9 MT. However in terms of TSR, we are still hovering around 4-5 per cent. AFR TSR increased from 0.6 per cent in 2010 to 4 per cent in 2016. The number of cement plants using AFR has increased from 12 plants in 2010 to 59 plants in 2016. This 4 per cent TSR accounts to 1.6 MT of alternate fuel usage in Indian cement industry and the current level of AF substitution saves 1.1 MT of coal per annum, saving costs of Rs 3,420 million. This gives an idea of the potential that exists in AFRM usage in Indian cement industry.

The basic reasons for this low TSR can be broadly assigned to lack of knowledge on AFR usage in Indian cement industry in the early years, especially on usage of industrial waste, lack of skilled persons for handling and usage of industrial wastes, lack of proper infrastructure for storage and feeding of AFR materials to cement kilns, lack of proper understanding on the permitting process in regulatory bodies and above all, the will to receive and use the waste materials in cement plants. In the last two years, remarkable transformation has been noticed on all the above aspects with dramatic changes in the mindset of regulatory bodies, the plant operating professionals and also of waste generators who are shifting to co-processing as a better option over landfilling and incineration as it provides a cost-effective option to them.

Market drivers
The market drivers for this change in mindsets of cement industry is mainly because the cost of fuel is continuously increasing, severely affecting the operating margins of the cement manufacturers. With increasing demand for cement, AFR usage becomes a key to reduce fossil fuel and raw material consumption and cost.

India’s cement sector, being one of the eight core energy intensive sectors, is a part of PAT scheme (Perform, Achieve and Trade), launched under the National Mission to Enhance Energy Efficiency (NMEEE). The cement industry has been one of the major contributors to energy reductions in PAT Cycle 1, having surpassed its targets by more than 80 per cent. Considering that latest technologies for energy reduction including waste heat recovery systems (WHRS), grinding systems etc., which are being widely adopted, one of the main levers to achieve PAT targets in the future is increasing AFR substitution in cement kilns.

Waste management
Waste management is a growing concern for India. The Government of India is attempting to tackle this challenge through a number of activities and programmes, including the Clean India Mission. Cement industries can certainly play a key role in promoting better waste management practices and create a win-win situation by working with urban local bodies on waste segregation and management of municipal solid waste. Substantial fractions of industrial, commercial, domestic and other wastes contain materials that have the potential for use as an alternative raw material or as a supplementary fuel for energy recovery in cement kilns.

This concept of co-processing is now well understood by the cement Industry, but still this scope and understanding in the waste generators is lacking and needs to be elaborately explained and understood by the waste generators.

The waste generators need to understand that co-processing is a proven sustainable development concept that reduces dependency on natural resources, reduces pollution and landfill space, thus contributing to reducing the environmental footprint. Co-processing is also based on the principles of industrial ecology, which considers the best features of the flow of information, materials, and energy of biological ecosystems, with the aim of improving the exchange of these essential resources in the industrial world.

Waste characteristics
AFR can be used alone also as fuel in cement kilns. A proper understanding of the processes, raw material characteristics and the waste compositions are the key factors that need to be assessed before use of AFR in a particular kiln system. At a cement plant, for creating systems for preparation of a homogenised raw mix that is fed to a kiln, we make a lot of investment. But the same understanding is lacking when we need to create facilities for improving AFR usage in the plant. The cement plants also need to know the characteristics of the waste that is to be co-processed and its compatibility to the raw material being used, to avoid process fluctuations and avoid kiln operating instabilities.

Normally, during the preliminary visit to the waste generators itself one should try to understand the waste characteristics, the waste material safety data (MSD), etc.

Proper samples are to be collected for analysis and reviewed if the waste is co-process-able or not. During the proposal and agreement finalization with the waste generators this aspect is considered for defining the quantities that are usable in the plant and define the safety aspects of the waste. Finger printing analysis is need to be done later to asses that the waste is in line to the agreement and safe to be handled, stored and used in the required proportion that will not affect the product quality and the environment.

In the plants that are utilising higher quantities of wastes it is desirable to have a proper waste finger printing analysis laboratory. Moreover, in plants that are utilising different types of waste it is also desirable to have a proper pre-processing facility for feeding a uniform quality of processed waste to the kiln system. Based on the quality of this processed waste suitable changes in the raw material composition can be done to ensure that required balances in the material characteristics is effected before material gets fed to the kiln system, for ensuring steady operation of kiln and uniform quality of desired product. A few third parties are also looking into creation of such pre-processing facilities for supply of processed waste to cement plants.

Many a time, investment on creating facilities at cement plant are made without proper understanding of waste available in the markets and its availability resulting into idling of the created facilities. There are a number of Indian as well as imported suppliers who can supply the required installations, but cement plants need to know what type of equipment is to be installed based on the market data of wastes available. Secondly, the concept of "POLLUTER TO PAY" needs to be imbibed into the waste generating industries to have a win-win situation. Unless these aspects are well understood, investing blindly may lead to lower returns on investment and frustration in the operating personnel at the cement plants.

Finally, to conclude it is imperative to know that Co-processing can offer a local and desired route to manage wastes with minimum liability and environmental impact addressing all the requirements of sustainable development and help reducing our energy demand from natural resources. Hence now it is time to know that there is urgent need for adopting co-processing of wastes as AFR in cement kilns, for managing our businesses efficiently in the country.

About the author:
Milind Murumkar, Advisor & Consultant for AFRM. He is operating as an advisor and consultant for improving the AFR usage in Indian cement industries, and enabling the cement industries as waste management solution provider for all sectors for sustainable waste management solutions. Earlier he had been successful in bringing regulatory changes in the waste management regulations, etc. with advice and support of CPCB & MOEF. Working for the betterment of waste management techniques, he is keen on developing this concept in schools and young people for a better and clean India.

Murumkar is presently associated with Orient Cement, Shree Digvijay Cement and Toshaly Cement as an advisor and consultant.

He is retired as senior general manager at ACC Limited, working with ACC for last 36 years in all disciplines, including quality control/ assurance, process engineering, procurement, logistics and co-processing of waste in cement kilns. He had developed this concept of co-processing of waste in cement kilns in 2006 along with other two seniors that has taken wings of change in last 10 years.

For three years post retirement, he has worked as an advisor to Vicat in India from 2015 to 2018. He can be contacted on: Mob: +919100960039 | 919004476333 or milind.murumkar@gmail.com.

Process

Price hikes, drop in input costs help cement industry to post positive margins: Care Ratings

Published

3 years ago

October 21, 2021

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Region-wise,the southern region comprises 35% of the total cement capacity, followed by thenorthern, eastern, western and central region comprising 20%, 18%, 14% and 13%of the capacity, respectively.

The cement industry is expected to post positive margins on decent price hikes over the months, falling raw material prices and marked drop in overall production costs, said an analysis of Care Ratings.

Wholesale and retail prices of cement have increased 11.9% and 12.4%, respectively, in the current financial year. As whole prices have remained elevated in most of the markets in the months of FY20, against the corresponding period of the previous year.

Similarly, electricity and fuel cost have declined 11.9% during 9M FY20 due to drop in crude oil prices. Logistics costs, the biggest cost for cement industry, has also dropped 7.7% (selling and distribution) as the Railways extended the benefit of exemption from busy season surcharge. Moreover, the cost of raw materials, too, declined 5.1% given the price of limestone had fallen 11.3% in the same aforementioned period, the analysis said.

According to Care Ratings, though the overall sales revenue has increased only 1.3%, against 16% growth in the year-ago period, the overall expenditure has declined 3.2% which has benefited the industry largely given the moderation in sales.

Even though FY20 has been subdued in terms of production and demand, the fall in cost of production has still supported the cement industry by clocking in positive margins, the rating agency said.

Cement demand is closely linked to the overall economic growth, particularly the housing and infrastructure sector. The cement sector will be seeing a sharp growth in volumes mainly due to increasing demand from affordable housing and other government infrastructure projects like roads, metros, airports, irrigation.

The government’s newly introduced National Infrastructure Pipeline (NIP), with its target of becoming a $5-trillion economy by 2025, is a detailed road map focused on economic revival through infrastructure development.

The NIP covers a gamut of sectors; rural and urban infrastructure and entails investments of Rs.102 lakh crore to be undertaken by the central government, state governments and the private sector. Of the total projects of the NIP, 42% are under implementation while 19% are under development, 31% are at the conceptual stage and 8% are yet to be classified.

The sectors that will be of focus will be roads, railways, power (renewable and conventional), irrigation and urban infrastructure. These sectors together account for 79% of the proposed investments in six years to 2025. Given the government’s thrust on infrastructure creation, it is likely to benefit the cement industry going forward.

Similarly, the Pradhan Mantri Awaas Yojana, aimed at providing affordable housing, will be a strong driver to lift cement demand. Prices have started correcting Q4 FY20 onwards due to revival in demand of the commodity, the agency said in its analysis.

Industry’s sales revenue has grown at a CAGR of 7.3% during FY15-19 but has grown only 1.3% in the current financial year. Tepid demand throughout the country in the first half of the year has led to the contraction of sales revenue. Fall in the total expenditure of cement firms had aided in improving the operating profit and net profit margins of the industry (OPM was 15.2 during 9M FY19 and NPM was 3.1 during 9M FY19). Interest coverage ratio, too, has improved on an overall basis (ICR was 3.3 during 9M FY19).

According to Cement Manufacturers Association, India accounts for over 8% of the overall global installed capacity. Region-wise, the southern region comprises 35% of the total cement capacity, followed by the northern, eastern, western and central region comprising 20%, 18%, 14% and 13% of the capacity, respectively.

Installed capacity of domestic cement makers has increased at a CAGR of 4.9% during FY16-20. Manufacturers have been able to maintain a capacity utilisation rate above 65% in the past quinquennium. In the current financial year due to the prolonged rains in many parts of the country, the capacity utilisation rate has fallen from 70% during FY19 to 66% currently (YTD).

Source:moneycontrol.com

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Wonder Cement shows journey of cement with new campaign

Published

3 years ago

October 21, 2021

admin

The campaign also marks Wonder Cement being the first ever cement brand to enter the world of IGTV…

ETBrandEquity

Cement manufacturing company Wonder Cement, has announced the launch of a digital campaign ‘Har Raah Mein Wonder Hai’. The campaign has been designed specifically to run on platforms such as Instagram, Facebook and YouTube.

#HarRaahMeinWonderHai is a one-minute video, designed and conceptualised by its digital media partner Triature Digital Marketing and Technologies Pvt Ltd. The entire journey of the cement brand from leaving the factory, going through various weather conditions and witnessing the beauty of nature and wonders through the way until it reaches the destination i.e., to the consumer is very intriguing and the brand has tried to showcase the same with the film.

Sanjay Joshi, executive director, Wonder Cement, said, "Cement as a product poses a unique marketing challenge. Most consumers will build their homes once and therefore buy cement once in a lifetime. It is critical for a cement company to connect with their consumers emotionally. As a part of our communication strategy, it is our endeavor to reach out to a large audience of this country through digital. Wonder Cement always a pioneer in digital, with the launch of our IGTV campaign #HarRahMeinWonderHai, is the first brand in the cement category to venture into this space. Through this campaign, we have captured the emotional journey of a cement bag through its own perspective and depicted what it takes to lay the foundation of one’s dreams and turn them into reality."

The story begins with a family performing the bhoomi poojan of their new plot. It is the place where they are investing their life-long earnings; and planning to build a dream house for the family and children. The family believes in the tradition of having a ‘perfect shuruaat’ (perfect beginning) for their future dream house. The video later highlights the process of construction and in sequence it is emphasising the value of ‘Perfect Shuruaat’ through the eyes of a cement bag.

Tarun Singh Chauhan, management advisor and brand consultant, Wonder Cement, said, "Our objective with this campaign was to show that the cement produced at the Wonder Cement plant speaks for itself, its quality, trust and most of all perfection. The only way this was possible was to take the perspective of a cement bag and showing its journey of perfection from beginning till the end."

According to the company, the campaign also marks Wonder Cement being the first ever cement brand to enter the world of IGTV. No other brand in this category has created content specific to the platform.

Process

In spite of company’s optimism, demand weakness in cement is seen in the 4% y-o-y drop in sales volume. (Reuters)

Published

3 years ago

October 21, 2021

admin

Cost cuts and better realizations save? the ?day ?for ?UltraTech Cement, Updated: 27 Jan 2020, Vatsala Kamat from Live Mint

Lower cost of energy and logistics helped Ebitda per tonne rise by about 29% in Q3
Premiumization of acquired brands, synergistic?operations hold promise for future profit growth Topics

UltraTech Cement
India’s largest cement producer UltraTech Cement Ltd turned out a bittersweet show in the December quarter. A sharp drop in fuel costs and higher realizations helped drive profit growth. But the inherent demand weakness was evident in the sales volumes drop during the quarter.

Better realizations during the December quarter, in spite of the 4% year-on-year volume decline, minimized the pain. Net stand-alone revenue fell by 2.6% to ?9,981.8 crore.

But as pointed out earlier, lower costs on most fronts helped profitability. The chart alongside shows the sharp drop in energy costs led by lower petcoke prices, lower fuel consumption and higher use of green power. Logistics costs, too, fell due to lower railway freight charges and synergies from the acquired assets. These savings helped offset the increase in raw material costs.

The upshot: Q3 Ebitda (earnings before interest, tax, depreciation and amortization) of about ?990 per tonne was 29% higher from a year ago. The jump in profit on a per tonne basis was more or less along expected lines, given the increase in realizations. "Besides, the reduction in net debt by about ?2,000 crore is a key positive," said Binod Modi, analyst at Reliance Securities Ltd.

Graphic by Santosh Sharma/Mint
What also impressed analysts is the nimble-footed integration of the recently merged cement assets of Nathdwara and Century, which was a concern on the Street.

Kunal Shah, analyst (institutional equities) at Yes Securities (India) Ltd, said: "The company has proved its ability of asset integration. Century’s cement assets were ramped up to 79% capacity utilization in December, even as they operated Nathdwara generating an Ebitda of ?1,500 per tonne."

Looks like the demand weakness mirrored in weak sales during the quarter was masked by the deft integration and synergies derived from these acquired assets. This drove UltraTech’s stock up by 2.6% to ?4,643 after the Q3 results were declared on Friday.

Brand transition from Century to UltraTech, which is 55% complete, is likely to touch 80% by September 2020. A report by Jefferies India Pvt. Ltd highlights that the Ebitda per tonne for premium brands is about ?5-10 higher per bag than the average (A cement bag weighs 50kg). Of course, with competition increasing in the arena, it remains to be seen how brand premiumization in the cement industry will pan out. UltraTech Cement scores well among peers here.

However, there are road bumps ahead for the cement sector and for UltraTech. Falling gross domestic product growth, fiscal slippages and lower budgetary allocation to infrastructure sector are making industry houses jittery on growth. Although UltraTech’s management is confident that cement demand is looking up, sustainability and pricing power remains a worry for the near term.