China demand to return by April; rest of world enters lockdown

China demand to return by April; rest of world enters lockdown
27 March 2020

Social distancing and country lockdowns have become the norm across the world as governments formulate new policies on a daily basis to contain and manage the COVID-19 pandemic.

The WHO now estimates that half-a-million people have been infected by the virus worldwide. The US now has more confirmed cases of the coronavirus than any other country, with 85,500 positive tests, while Italy has the most fatalities at 8215, followed by China at 3291.

Cement industry shuts down
In line with government emergency responses and guidance in each country, the cement industry has reacted promptly by implementing social distancing measures for staff, including working from home where possible, improving sanitary conditions for workers that remain active in plants and temporarily suspending operations where appropriate.

No region of the world has been spared. In India, where 1.3bn people are now under a lockdown, Dalmia Bharat reported it has suspended the entire 26.5Mta of cement manufacturing capacity. In Latin America, Cemex suspended production in Colombia and Panama. NPC also reported a complete lockdown of its operations in South Africa. In Europe companies have suspended multiple operations, while some are continuing to operate at reduced levels for the time being.

At a company level, emergency continency plans are being rolled out rapidly. LafargeHolcim’s action plan – Health, Cost and Cash – summarises the key priorities for most cement businesses at this time: to protect the health of their employees, reduce all possible expenditure and conserve cash.

The economic consequences of the crisis will be immense. In Spain, where the impact of the virus has been particularly severe, the cement industry association has called upon the government not to paralyse the construction sector in the face of the pandemic, and to consider maintaining minimum activity levels so as to ensure the country is prepared for the exit of the crisis.

China cement demand to return by April
In the meantime, construction activity and cement production operations in China are restarting at pace, as the country emerges from the lockdown which commenced in February. As of 20 March, the operating rate of 274 cement clinker production lines surveyed across the country was 71.9 per cent. It has been reported that 96.6 per cent of plants owned by the Anhui Conch Group, one of China’s largest building materials producers, are now operational. Industry commentators are estimating cement demand to return to precrisis levels by April.

The world will be watching closely as China returns to work. The main fear is that by releasing the lockdown, the virus will simply return in a second wave, which will require a second lockdown. Managed correctly, and with continued social distancing, the hope is that China can control the virus effectively enough for the country to return to work.

>>    ICR's technical consultant, Dr Michael Clark, has compiled a punchlist to help cement plants ready themselves for COVID-19.
> >   ICR's news page for COVID-19 related items, updated daily:

Published under Cement News