The President of the World Cement Association (WCA), Wei Rushan, addresses members to highlight the significant transformations shaping the global cement industry. Emphasising the need for innovation, sustainability, and collaboration, he called on industry stakeholders to embrace the evolving economic, regulatory, and geopolitical challenges ahead.

“The cement industry is experiencing profound changes, with businesses managing overcapacity and upgrading, balancing sustainable development with short-term survival, and weighing social responsibility against shareholder returns,” stated Rushan. “While each region faces unique challenges, our shared focus remains on driving sustainable growth, embracing technological advancements, and tackling climate change.”

As outlined in the WCA’s recent White Paper, global cement demand is expected to decline by 22 per cent by 2050. In established markets like Europe and North America, price increases are expected to persist, while in some emerging markets, prices may experience a short-term decline. However, from a long-term perspective, we expect emerging market to remain dynamic and resilient.

Key regional developments

Multinational companies are adjusting their strategies and scaling back cement business, focusing instead on North America. Meanwhile cement production in Europe continues to decline due to strict CO2 regulations and necessary capacity reductions, driving up cement prices. Efforts to address overcapacity in China and Japan have led to significant consolidation and restructuring.

In contrast, cement production in India is rapidly expanding, with more than 200 million tons produced. Indian companies are strengthening their domestic leadership, while multinational companies are exiting this high-potential market.

Globally, regional leaders are gaining influence, except in Europe and North America, where European multinationals continue to dominate. Chinese cement producers and other independent companies are aggressively expanding, particularly in Africa and Southeast Asia, solidifying their market presence.

Addressing global challenges

Wei identifies overcapacity as a major challenge facing the industry today. As a global representative for the cement industry, the WCA is willing to work with producers and stakeholders to explore ways to modernise and upgrade outdated plants. “To remain both profitable and environmentally responsible, the cement industry must aim to reduce capacity by 50 per cent, from 4.7 billion tons to 2.3 billion tons within the next decade. This requires focusing on modern, sustainable production units.”

He also noted carbon reduction and carbon neutrality as another key challenge. Although progress has been made through Carbon Capture and Storage (CCS) technologies, Rushan acknowledged the high costs and energy intensity of these solutions.

“Cement plays a crucial role in building sustainable infrastructure,” Mr. Wei continued. “By accelerating innovation, adopting low-carbon technologies, and fostering global collaboration, we can ensure cement remains an environmentally responsible material.”

The WCA urges industry stakeholders worldwide to act now by adopting sustainable practices, embracing innovation, and redefining cement industry norms.

Cement manufacturer ACC reported a net profit of Rs 10.91 billion for the third quarter ending December 2024, a significant increase from the Rs 5.37 billion profit posted during the same period last year. The company’s revenue from operations reached Rs 52.07 billion in the current quarter, compared to Rs 48.55 billion a year ago.

The results for the quarter are not directly comparable to last year’s figures due to ACC’s acquisition of the remaining 55 per cent of Asian Concretes and Cements (ACCPL) and its step-down subsidiary, Asian Fine Cements. The consolidated financial results for this quarter include those of ACCPL.

Additionally, ACC received a Rs 7.20 billion refund from the government as an excise duty exemption on clinker consumption for the period from May 2005 to February 2013. This refund follows a ruling in ACC’s favour by the Customs, Excise, and Service Tax Appellate Tribunal. Of this amount, Rs 6.36 billion was recognised as income in the current quarter and the nine months ending December 31, 2024.

The company’s total expenses for the December quarter stood at Rs 50.99 billion, while its total income was Rs 65.75 billion. The revenue from the cement business was Rs 56.14 billion, and from Ready Mix Concrete, it was Rs 3.44 billion.

ACC attributed its performance to volume growth, cost optimization, and improved efficiency. The company expects continued growth, driven by demand for premium cement products and a focus on innovation and sustainability.

Looking ahead, ACC anticipates that the cement sector, which experienced modest growth of 1.5-2 per cent during the first half of FY25, will rebound in the fourth quarter as construction activity accelerates in the infrastructure and housing segments. The company projects cement demand growth of 4-5 per cent for FY25, supported by the pro-infrastructure and housing measures in the 2025 Budget and increased government spending on infrastructure projects.
News source: ET Energy

Dalmia Bharat plans to invest approximately Rs 10 billion in capital expenditure for the quarter ending in March, bringing its total expenditure for the current fiscal year to around Rs 30 billion.

As for the fiscal year 2025-26 (April-March), the company intends to spend between Rs 25 billion and Rs 30 billion on capital expenditure. Dalmia Bharat’s current annual production capacity is 46.6 million tonnes, which is set to increase to 49.5 million tonnes by the end of March.

India, being the second-largest cement producer globally, has seen domestic players aggressively expand capacities through both expansion and acquisitions to meet the anticipated demand driven by the government’s infrastructure push. It is projected that between 2024 and 2028, 150-160 million tonnes of capacity will be added, driven by a combination of organic and inorganic growth. This increase in supply, coupled with heightened competition, is expected to limit the growth of cement prices, as noted in a Crisil report from last year.

Dalmia also mentioned that while optimism surrounding cement prices has risen due to recent price recoveries, the intensifying competition may prevent any substantial price increases. He noted that the current market conditions are marked by aggressive market share pursuits, which, coupled with the lack of demand growth in the first nine months, have added strain to the industry. He pointed out that every industry goes through phases where the focus shifts from market share to prioritizing margins, as beyond a certain point, market share no longer delivers value.

He anticipates that competitive pressure, particularly in the southern markets of India, will persist, alongside ongoing consolidation within the industry.

News source: The Economic Times