Early September saw about 250 delegates from international cement companies and equipment suppliers meet at the Hotel Marriott in San José, Costa Rica, for the 29th annual FICEM-APCAC Technical Congress to hear over 50 presentations. Despite being briefly rattled by the country’s most severe earthquake in 20 years, the event generally proceeded without a hitch.

Costa Rica provided the beautiful backdrop for the 29th FICEM-APCAC conference which brought together representatives of Latin America’s cement sector and beyond

The sessions, which took place between 2-6 September 2012, began with a speech by Gabriel Restrepo, FICEM board president. He explained that FICEM encompasses all of Latin America, plus Spain and Portugal, representing 146Mta of cement production, 74 companies, and 246 plants, of which 178 are in South America and 41 in Iberia. FICEM’s cement markets are rapidly growing with large infrastructure needs, he noted.

Irene Campos, minister of Housing and Human Settlements in Costa Rica, summarised the housing situation in the country. Low-income households receive US$1100-US$2000 in annual housing subsidy which, when annual household income is below US$400, reaches 100 per cent. Since May 2010, some 22,400 families have been helped by this measure, which costs the government around US$160m in 2012 with the same figure likely for 2013. However, this results in a steady level of housing construction at around 12,000-13,000 units annually. Ms Campos highlighted that at 13.8 per cent Costa Rica has the lowest ‘housing deficit’ in Latin America. Looking forward, the Costa Rican government is striving to transform shanty towns and promote higher vertical housing density in cities. 

Manrique Arrea, president of ICCYC, the Costa Rican Institute of Cement and Concrete, confirmed the finding that Costa Rica was the ‘happiest place on earth’. He stated that many Latin American countries, including Costa Rica, are dependent on the US. Tourism and holiday homes are huge sectors for these economies. Like other regional economies, Costa Rica has a large infrastructure deficit and a sizable component of construction involving informal, undocumented workers and work.

Latin American sustainability efforts

After the coffee break, Enrique Bertrand of PwC spoke about the Getting the Numbers Right (GNR) CO2 data collection programme. PwC is collecting CO2 information, guaranteeing confidentiality, from industries all over the world and reported that the cement industry is one of the best organised. CO2 reporting is mandatory in Europe but voluntary in the rest of the world. About 120 of 170 Latin American cement plants reported in 2012. Bertrand then discussed the relatively low reporting costs of GNR. Initial findings of the survey were that average Latin American cement plant CO2 emissions were below Europe and world levels.

The cement industry needs to be part

of the climate change and

sustainability conversation

Holcim’s Andrés Jensen, the representative of FICEM’s Climate Change and Co-Processing Working Group, continued with a very informative presentation of the GNR’s overall framework, the World Business Council for Sustainable Development-led Cement Sustainability Initiative (CSI). He also discussed the UN report on emissions. This study had three goals to consider: CO2 emissions, energy efficiency, and alternative fuels. FICEM’s CSI Task Force started in late 2009 with a representation of the major multinational companies, eg Cemex, Holcim and Argos, with the first collection of data for 2010. Gross CO2 emissions were 606kg/t of cement produced for FICEM plants, 655kg for Europe, and a world average of 656kg. Taking co-processing into account, net CO2 emissions were, respectively, 590, 602, and 633kg/t of cement produced. Thus, Latin American cement plants had lower gross and net CO2 emissions than the world or European averages. Why? Jensen gave two possible factors. Firstly, FICEM plants produce an above average amount of blended cements. Secondly, Latin American cement kilns tend to be younger on average, using newer, more efficient technology. He further cited the improvements made in these regards. The clinker factor in the region’s finished cement has fallen 15.1 per cent from 82 per cent to 70 per cent, while the net CO2 emissions declined 17.5 per cent from 715kg/t cement produced to 590. In summary, Jensen opined that the cement industry needs to be part of the climate change and sustainability conversation and the GNR data collected adds credibility. There was a lively question-and-answer session following the presentation.

The BRICs and beyond

A video link to Paul Rogers of BNP Paribas conveyed a large amount of information in a short time. Briefly, year-to-date cement sales have increased smartly in North America and the BRIC countries, but have declined in Europe and Argentina. For 2013, cement volume gains are expected to be around five per cent for the BRICs and less everywhere else with Europe showing further single-digit decreases.

The 2013 BNP Paribas world cement outlook today is slightly weaker than earlier in 2012. Mr Rogers examined how the various components of construction are affecting the cement outlook: residential, non-residential, and infrastructure. A rebound in housing in America and many other countries is the main factor for renewed growth. He looked at private and government debt burdens and prospects for better economic growth. He accepted the generally-held view that economic growth, construction activity and cement demand are slowing in the BRICs but are better than the rest of the world. The US recovery is definite, but the pace is slow by historical standards, especially considering the very low base from which the turnaround started. Europe remains a big concern.

Mr Rogers said cement prices in some countries, especially China, are coming under downward pressure from burgeoning excess cement supply. Overall, however, cement prices are forecast to increase in 2012 and 2013 for most countries despite weak cement demand because of continued rises in fossil fuel and power costs as well as new government regulations.

Sustainability at the fore

Cement producers and equipment suppliers alike

enjoyed the coffee breaks in the exhibition area

The rest of the conference presentations concentrated on technical matters regarding sustainability, climate protection, new equipment and technologies, maintenance, energy efficiency and co-processing. Real-world experiences were given by personnel from several Latin American cement companies. Vendors described their latest equipment, especially related to co-processing and to reducing CO2, mercury levels, and other emissions.

Throughout the conference it was apparent that cement companies in FICEM and other countries want to produce cement both profitably and sustainably. Cost control and climate protection are both paramount. In these highly uncertain times, capex budgets are tight, so funds must be used wisely. By the conference’s end, the attendees hopefully had a better understanding of how to achieve their goals.

Article first published in International Cement Review, December 2012.