Cemtech Asia: success in Bali

The opening VIP line-up. From left: Dr Randolph Wintgens;
Suryo Sulisto, KADIN Indonesia; Urip Timuryono,
chairman of the Indonesian Cement Association; and
Anton Gunawan, chief economist at Bank Danamon, Indonesia

With Asia now driving much of global cement demand growth and countries such as Indonesia are now leading the field in terms of domestic sales expansion, industry profitability and new capacity announcements, locating Cemtech Asia on the tropical island of Bali, on the southeastern tip of this far-reaching archipelago, proved an inspired choice for delegates, presenters and exhibitors alike.

Especially so as the event undoubtedly proved a draw for the high-level Indonesian contingent present and allowed Urip Timuryono, chairman of the Indonesian Cement Association to set the scene in his opening address on prospects for the local industry.

In essence the Indonesian cement industry boasts seven separate cement groups operating a total of 13 integrated production sites. State-owned Semen Gresik Group retains its lead role nationwide with three subsidiary operations: Semen Padang, Semen Gresik and Semen Tonasa which combined have a clinker capacity of 16.7Mta and a cement capacity of 19.7Mta. Next is HeidelbergCement’s Indocement operation owned 51 per cent by this German cement major, with the balance held locally. From its three production sites, Indocement controls 15.6Mta of clinker capacity and 18.6Mt of cement capacity. In reality,

Indocement is the market leader in the most developed provinces – Jakarta, West Java and Banten and for the record, foreign majors comprising HeidelbergCement, Holcim and Lafarge control and operate 23.2Mta of clinker capacity and 27.9Mta of cement capacity giving them a 53 per cent theoretical overall cement market share.

In 2010, Urip noted, Indonesian producers manufactured 37.84Mt of cement, compared to a total domestic consumption level of 40.78Mt. Imports of 1.6Mt (mainly Malaysian) helped to redress the balance, but these were largely due to meeting shortfalls in Lafarge production as it completed its rebuild of the Tsunami-damaged Aceh works. Of note also was that Indonesian producers, led by Gresik, also exported an additional 2.14Mt of clinker to overseas markets in 2010, a sizeable tonnage level but well down on the 5.02Mt of clinker exports achieved in 2005. In reality, Indonesian producers have refocused on the more profitable domestic sector rather than exports offering much lower returns.

Looking at the complete Indonesian archipelago, the main heavily-populated island of Java took over 54 per cent of total sales in 2010 compared to 24 per cent for Sumatera, and only seven per cent for both Kalimantan and Sulawesi and finally six per cent for Bali-Nustra and a low two per cent for Maluku-Papua.

All regions are maintaining good annual levels of cement growth with Kalimantan and Sumatera both exhibiting particularly strong upward movements in consumption over the past five years.

Urip was confident that: “cement demand nationwide will rise from 40Mt in 2010 to almost 55Mt by 2015. New cement capacity will add a further 25Mt of production output over that same time-frame, keeping the industry totally self-reliant.”

Speaking on behalf of the Cemtech Asia conference organisers, David Hargreaves was also delighted to report from Indonesia at a time when it is clearly developing quickly as a major cement consuming country. “It has huge potential for growth given its population of close to 250m, a low per capita consumption of just 160kg and a present cement production base running close to its limits."

Anton Gunawan, Chief Economist at Bank Danamon, Indonesia was keen to focus on regional and Indonesian economic developments and how such changes would impact cement demand.
In his view: “Southeast Asian economies will continue to perform well, except for Vietnam, which is still vulnerable owing to high inflation, a large current account and fiscal deficit.”

For Indonesia, Mr Gunawan was cautiously optimistic that: “Faster economic growth, but with a still big informal sector and rising optimism – towards investment grade – in 2012” would prevail. He also welcomed: “more pro-poor social policies (education, health, etc)’ to combat “high poverty levels and under-employment rates.

“Indonesia’s young population generates strong demand for new housing with government estimates indicative that 710,000 units are needed annually,” he added.

“Not surprisingly strong domestic cement consumption growth will continue in 2011 throughout most of Indonesia," Mr Gunawan concluded.

Presenters and their chairman, Keith Hall, on

day one of the conference proceedings

Moving on from Indonesia, delegates were taken on a cement tour of the ASEAN region with particular emphasis on Malaysia, thanks to an informative presentation from Martin Wilkes. Kiran Redkar, CEO of Ultratech Sri Lanka provided a stimulating review of this growth market, while ending the first morning, Oepoyo Prakaso, a senior Holcim Indonesia executive provided a range of valuable insights into the establishment of a greenhouse gas reduction scheme for the Indonesian cement sector.

Marilyn Gardner opened the afternoon by with a cogent presentation of the Australian cement sector followed by a detailed review from Cemex Philippines' Miguel Roberto Estrada who gave an excellent report on: ‘Efficiency Improvements at Cemex’s Solid Cement works – generates record outputs’.

Two senior Conch delegates (left and right)

with Urip Timuryono (centre)

As a first for Cemtech Asia, it was a delight to welcome a large senior delegation from China’s leading producer Conch Cement and a presentation from Ms Li Zhao Hui which focused on Conch’s use of high technology systems to accelerate its massive growth programme over the past 15 years. Conch Cement now produced 146Mt of cement and sold 176.28Mt of cement and clinker in 2010 making it the largest player in China and within the top five worldwide. It also sells a sizeable tonnage abroad achieving 10.43Mt of clinker and 3.11Mt of overseas sales back in 2007.

The final presentation of the day was in the very capable hands of Gregers Schmidt, a senior FLSmidth representative, who looked in some detail at advanced technology systems, energy efficiency and environmental performance – with an emphasis of new Asian plants – no better way to end the day!

Day 2 of the conference opened with a well respected Cemtech regular, Dr Michael Clark setting the scene with an operator-specific presentation on: ‘Improving plant performance and efficiency – 10 key steps’. Various options were given, not least reducing clinker content in the finished cement to improve existing cement capacity levels; motivating the existing manpower; installing a roller press in front of a ball mill – to name but three areas.

ABB’s Hans-Helmuth Jung looked in some detail at: ‘Raw material optimisation in real time’ using ABB’s on-line analyser, its Expert Optimiser modules along with the preblending software. A powerful, cost-effective combination.

Guah Eng Hock, taking questions from

the floor on his informative presentation

Gua Eng Hock from Resource Co, Singapore took delegates through the benefits and challenges of using alternative fuels in cement kilns, providing some recent Asian case studies to back up his arguments. An excellent presentation and well suited to this session’s specific kiln burning focus was: ‘Kiln video and thermography, alternative fuels and clinker quality’ from Roland Zepeck, Durag Group, Germany. Then ‘Model predictive control for cement plant optimisation’ from another well respected Cemtech speaker – Steve McGarel, industry manager, Rockwell Automation, USA and not least, Con Manias, who handled his chosen subject: ‘Alternative fuels in the mix – a recipe for success’ with authority befitting his role as head of the FCT Group in Australia.

The final afternoon opened with a well researched and implemented case study on ‘designing, building and commissioning a new grinding plant’ by Spanish experts Cemengal with company spokesman Fernando Duenas Pozo doing the presentational honours.

Anders Arvidsson from Opsis AB, Sweden, looked at the: ‘Additional benefits of using advanced multigas analysers for kiln emissions’. As Anders pointed out: “Measuring is knowing! Extended monitoring of kiln emissions can prevent unnecessary events and issues and provide useful feedback for plant operators.”
The final session allowed IBAU Hamburg and presenter Dicken Sze to examine in excellent detail:

‘Cement storage and distribution terminals’ using technology, know-how and many years of experience in worldwide markets to illustrate why IBAU is among the leaders in this specialist field.

Last, but certainly not least, the final presentation of the day: ‘Optimisation of packing plants and application of ultrasonic valve sealing’ by Loh Han Sen, the regional representative for Claudius Peters, Germany, explained how to improve packing plants, bag filling systems, advances in bag sealing and related topics.

Finally, a half-day workshop with the theme: ‘Manufacturing clinker and cement with less embodied CO2’ led by Dr Michael Clark, was also included on the final morning of the event attended by some 20 cement operations and production specialists.

All in all, some 20 industry specific presentations were given and the organisers are indebted to the Indonesian Cement Association and its chairman, Urip Timuryono, for the help given in planning and executing this event. A special mention is also due to Dr Randolph Wintgens for his untiring efforts in the preparation and indeed running of this event. We could not have achieved the level of success we did without his extensive inputs into the organisation.

Sincere appreciation to the international Cemtech exhibitors, all of whom expressed approval of the facilities, participating customers and related hospitality levels. In fact, to all who attended the conference, the Grand Hyatt Bali clearly provided a unique tropical five-star venue with an excellent range of services, superb ocean-side location and not least, delightful well-qualified hotel staff on-hand throughout.
Planning for next year’s Cemtech Asia is now underway. We look forward to seeing you all once again at what is developing into a major cement event for this dynamic region. Watch out for early news on venues and dates for 2012.  Better still – see you there!