CEMENT SECTOR ANALYSIS

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CEMENT SECTOR ANALYSIS

IF YOU WORK IN A CEMENT PLANT AND YOU NEED COURSES AND MANUALS LIKE THIS MANUAL AND BOOKS AND EXCEL SHEETS AND NOTES I SPENT 23 YEARS COLLECTING THEM YOU SHOULD CLICK HERE TO DOWNLOAD THEM NOW

>Questions we are going to answer

1)What is Cement?

2)Swot Analysis of Cement Sector

3)General Condition of a Cement Sector in the World

4)General Condition of a Cement Sector in Turkey

5)Related Sectors

6)Cost Components and Problems of Sector

7)Porter’s Five Forces Model

8)Future Prospects of Cement Sector

 

What is Cement?

—A cement is a binder, a substance that sets and hardens independently, and can bind other materials together

—A cement includes calcium, silicon, aluminium, iron-oxide, calcareous, clay, marn, iron gem.

—Clinker is ground to become Portland cement. It may also be combined with other active ingredients or chemical admixtures to produce:

–  ground granulated blast furnace slag cement

–  pozzolana cement

– silica fume cement

Types of Cement

—Portland cement:The most common use for Portland cement is in the production of concrete

—NonPortland hydraulic cements

-Pozzolan-lime cements

-Slag-lime cements

-Supersulfated cements

-Calcium aluminate cements

-Calcium sulfoaluminate cements

SWOT Analysis of Cement Sector

Strengths

—Cement is, literally, the building block of the conAlmost every building constructed relies on cement for its foundation

—struction sector

—The cement business is a $10 billion sector, measured by annual cement shipments

—There is also a strong reputation behind the cement sector

—Cement is a solid material and consumers rarely have complaints about the product

—Regional distribution plants have also made cement widely available to any type of buyer.

Weaknesses

—The cement sector is not without its drawbacks

—The cement sector relies on construction jobs to create a profit

—The cement sector heavily relies on weather

—About two-thirds of cement production takes place between May and October

—Cement producers often use the winter months to produce and stockpile cement, to meet demand

—The cost of transporting cement is high and this keeps cement from being profitable over long distances

—In other words, shipping cement costs more than the profit from selling it

Opportunities

—One opportunity is the cement sector’s efficiency

—The cement sector has recently streamlined its production efforts, using dry manufacturing instead of wet, which is heavier and more time-consuming

—The cement sector has also invested about $6 billion in expansion efforts to meet unmet cement needs

—Projections show that by 2012, the cement sector will have 25 percent more production capabilities

Threats

—The nature of the economy have uncovered a number of threats to the cement sector

— The cement sector greatly relies on construction

—The current economy has lessened the number of construction jobs, which in turn hurts the cement sector

—Kyoto Protocol and EU Environmental Legislation has introduced regulations for the cement sector to cut down emissions

 

—In 2008, world cement production reached 2,87 billion tons

—European Cement Union countries produces 11 % of total world cement production

—In 2008 and 2009, because of the economic crisis, production of cement is decreased

 

—In 2008, exporting value of China was 26 million tons but in 2009, it dropped to 14 million tons and its capacity increased to 1,3 billion tons

—It indicates overcapacity problem of a sector

—Global economic crisis in 2009, affected mortgage market in USA, after that construction sector and so cement sector are affected

—Consumption of cement is decreased mostly in America and Europe continents

—Consumption is decreased most in Russia (25%)

—Although these decreases, cement consumption increased in Mediterranean Countries such as Libya, Algeria, Syria and Iraq

—Turkish cement sector is in the first ten countries in the world

—In Europe, Turkey is third in production and fourth in selling cement

—In 2009 production reached 54 million tons and capacity reached 90 million tons.

 

—Cement sector is only sector which is not unregistered in construction sector

—Demand in cement sector changes according to economic conditions and investment environment in related country and it stagnates the period that there is no expenditures

—Especially, the last global economic crisis affected construction and real estate sectors, so demand of cement is decreased

 

—In cement production raw material, auxiliaries, energy and fuel are important cost components

—Also transportation is other important component

—Especially cost of energy, fuel and transportation demage competitiveness of the cement sector in the market

—Turkish cement producers have disadvantages in cost according to the international competitors in the market

Capacity Problem

—Because of overcapacity and intensive competition, prices are decreased and sector is in trouble

—In 2008 Feb, average cement price was 120 TL, but it decreased 27 percent to 88 TL in 2009 Feb, also in 2010 average price is 85 TL

—It is expected that the capacity problem will continue for a while  because of stagnation in the market

—To solve this problem investments must be planned and controlled

—For using all of the current capacity, investment of civil infrastructure and urban regeneration projects must be increased

Transportation

—In fact increasing in domestic and international markets, increased production cost affect export in bad manner

—The most important factors in the exporting cement is inadequate railways and export ports

—Because of the inadequate ports, exports are made by highways

—High transportation cost is important barrier in exportation

—To solve his problem there must be policies to increase exportation

—Ports and logistic projects must be improved

Energy

—Especially high petroleum prices affect cement sector badly

—Because of low sale prices which is caused by overcapacity, sector is in trouble because of incerasing production cost

—There must be fiscal policies in energy costs

—Also companies are sensitive about energy efficiency and increase environmental awareness

—Also companies are sensitive about energy efficiency and increase environmental awareness

—There must be trainings about energy efficiency and cost advantages must be determined

Environmental Regularization

—Kyoto Protocol and accordance to EU Environmental Legislation are important problems about environment

—In this process sector will have to make high technological investments and establish new treatment plant

—For this expenditures and investments finance and timing are main problems

Research&Development

—Projects must be developed to decrease gas emissions and energy consumption

—It must be provided that sector has to give importance to R&D activities

Porter’s 5Forces-Barriers to Entry

—There are no barriers to entry

—But if you want to build a cement factory capital cost is high (approximately 130 million dollars to build 3500 tons/days capacity)

—The main consumer is housing markets

—Housing is now booming as a part of the remittances is being used for construction of houses

—Commercial banks with liquidity are finding housing sector potential area for lending

—Infrastructure is the another segment of cement sector

—Cement demand in emerging economies is much higher than developed countries where the demand has reached a plateau

—Licensing of main reserves is controlled by government

—The shortage of a raw material remain a concern

—Transportation and packaging suppliers can affect bargaining power so backward integration can be used

—Gypsum plaster is a good substitue for construction purposes

—Gypsum plaster is also useful in construction in regions of extreme cold and hot climate for isolation

—Existing firms are trying to expand their capacity

—Government enforce the improvement quality of the cement and rivalry by the anti-trust laws

—Competition Board is analyse the sector, for mergering, acqusition, and price statement activities

Future Prospects of Cement Sector

—As it is mentioned before global economic crisis affected construction sector so cement sector is also affected

—The world have experienced a recession in demand in 2009

—Turkey also affected by the recession and declines in domestic consumption was observed

—170 million tons in the entire world experienced an increase in capacity, and this has created excess demand

—Experienced decline is foreseen in the coming years, increases in capacity, capacity increases are expected to be provided by the majority of developing countries

—Losses in the demand recovery is expected in the coming years, in Europe such a recovery is not expected in the short term

—The investment in the sector is thought to increase in the United States and Russia

—Cement consumption in the two countries share most of the India and China have shown differences in the predictions for 2010, India’s growth potential is expected to be higher than China’s

 

IF YOU WORK IN A CEMENT PLANT AND YOU NEED COURSES AND MANUALS LIKE THIS MANUAL AND BOOKS AND EXCEL SHEETS AND NOTES I SPENT 23 YEARS COLLECTING THEM YOU SHOULD CLICK HERE TO DOWNLOAD THEM NOW

 

 

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