Viewpoint: CBAM to reshape Med cement trade flows

Spanish Market: Cement, Petroleum coke
24/12/25

Europe's Carbon Border Adjustment Mechanism (CBAM) is set to reshape seaborne cement and clinker trade flows from the eastern Mediterranean and North Africa, diverting volumes away from the EU toward other growing markets such as west Africa, the Middle East and parts of South America, with exporters likely to lower fob prices to compete for new buyers.

CBAM, scheduled to begin on 1 January, will impose a charge on imported cement and clinker with embedded carbon emissions above an established benchmark. The EU's preliminary implementing acts published last week have set these benchmarks lower than earlier proposals, which will likely mean higher CBAM costs for most imports.

If the policy is implemented as currently proposed, a grey Portland cement producer from Egypt that has not had its emissions intensity verified by the EU would be subject to a country default value of 1.419t of CO2 equivalent (CO2e)/t of cement in 2026. This is more than twice the free allowance benchmark value of 0.666t of CO2e/t, meaning an importer would owe a significant portion of the EU emissions trading system (ETS) allowance price for each tonne of cement. The ETS price now stands at more than €85/t of CO2e after rising earlier this week to its highest level since 2023. Fob prices for Egyptian or Turkish bulk cement are in the high $50s/t to low $60s/t, or roughly high €40s to low €50s/t on a euro dollar basis.

Not only do the CBAM costs eliminate the price gap that has historically favoured suppliers from Turkey and North Africa exporting into the EU, but there is also additional risk in taking these imports.CBAM fees for next year's imports will not be calculated until 2027, when the EU ETS prices could be even higher.

CBAM could divert millions of export tonnes

EU companies were ramping up imports from Turkey and North Africa this year, likely to stock up ahead of CBAM.

The new CBAM costs are likely to make much of this volume uncompetitive in the EU. Exporters may respond either by lowering fob or delivered prices in order to absorb some of the CBAM cost and defend EU market share, or by diverting volumes to non-EU markets, such as the US, west Africa, Middle East, or South America.

Turkish cement exports to core EU buyers — Spain, Romania, Italy, France, Greece and Bulgaria — rose to 2.06mn t in January-September, up from 1.39mn t in the same period a year earlier, the latest Global Trade Tracker (GTT) data show. Clinker shipments to these buyers reached 2.12mn t in January-September, up from 1.55mn t over the same period last year and above the 2.08mn t shipped in the whole of 2024. Turkey accounted for about two-fifths of EU cement and clinker imports in 2024, Cembureau data show.

North African exporters focused on clinker, with combined shipments to Europe at 2.14mn t in January-September, up from 1.64mn t a year earlier, according to GTT. Key destinations included Italy, Ireland, Croatia, Greece, France, Spain and Belgium.

Much of this volume is now likely to move to countries that are seeing robust import growth. For cement, these include Syria, Iraq, Libya, Ghana, Guyana, Haiti, Guatemala, Peru and Jamaica. For clinker, demand growth is strongest in Syria, Senegal, Cameroon, Togo, Liberia, Mauritania, Guinea, Ghana, Guyana, the Dominican Republic, Colombia and Ivory Coast. These markets are structurally dependent on imports and highly price-sensitive.

Mediterranean exporters will likely need to lower prices in order to attract new buyers in these regions as South Asian exporters have also been competing to export more to these markets.

Vietnam continues to offer some of the lowest-priced clinker to west Africa and South America, supported by its surplus capacity and competitive Atlantic freight. Pakistan is expanding its exports into east Africa, the Mideast Gulf and south Asia and is now probing Atlantic markets with aggressive pricing. And Saudi Arabia is emerging as a major supplier of cement and clinker, particularly to the Middle East and Africa.

Spot cement offers from Pakistan and Vietnam were recently in the mid-to-high $30s/t fob, compared with the mid-to-high $50s/t fob from Turkey and Egypt. In the clinker market, Turkish and Egyptian exporters are keeping offers at $44-45/t fob against $29-31/t fob from Asian producers. Vietnamese exporters also offer larger shipments, including on Panamax and Capesize vessels, which allow them to move more volume at lower freight costs.

Another potential drag on cement and clinker prices in 2026 is a slowdown in the US cement market. The US is a major global importer and has been increasing its intake from suppliers like Turkey, Egypt and Vietnam. But imports are forecast to hit a bottom of around 17mn t in 2026, according to analyst Ed Sullivan of The Sullivan Report, as the US struggles with an uncertain policy landscape, new tariff costs, and low home affordability.

But while market fundamentals and upcoming policies point to downward pressure on export prices across the Mediterranean and beyond, Mediterranean cement producers could find it difficult to significantly lower prices in order to compete in new export markets. Prices lower than current levels would mean losses for Turkish producers, one Turkish exporter said earlier this month.

By Alexander Makhlay and Lauren Masterson

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17/12/25

Indian cement plants use more domestic coal in November

Singapore, 17 December (Argus) — Domestic thermal coal supplies to Indian cement makers rose on the year in November and from October, with producers increasing coal use to benefit from its competitive pricing vis-a-vis petroleum coke. Cement makers received 730,000t of domestic coal in November, up by 1.6pc from 720,000t a year earlier, India's coal ministry data show. Receipts in April-November — the first eight months of India's April 2025-March 2026 fiscal year — were up by almost 23pc on the year at 6.33mn t. Receipts rose by 14pc from 640,000t in October, indicating an uptick in cement output and demand in the dry season after the monsoon rains. The increase was also partly supported by the removal of a 400 rupees/t ($4.43/t) levy on coal effective 22 September. Higher domestic coal supplies have enabled cement plants to increase the share of coal in their fuel mix. Cement plants use coal and coke as fuel in cement making. Most plants can switch between coal and coke to take advantage of lower costs. The recent increase in cfr prices and offers of seaborne high-sulphur coke may also have prompted some cement plants to expand reliance on domestic coal, but most producers still need to blend coke in certain ratios to use the locally available coal. A weakening of the rupee against the dollar may also be triggering a preference for domestic coal compared with imported fuel. The rupee averaged Rs88.88 to the dollar in November, compared with Rs88.37 in October. It has slipped further and averaged Rs90.08 so far this month, after hitting a record low of Rs91 on 16 December. January-loading Supramax cargoes of US high-sulphur coke are being offered in the high-$110s/t cfr on India's west coast. The Argus -assessed index for the delivered India price of 6.5pc sulphur coke was last marked at an over eight-month high of $118/t cfr on 10 December. Indian coal supplies to non-power consumers, such as cement plants and steel mills, increased in the first eight months of the current fiscal year because of higher availability and lower demand from coal-fired power plants. Higher domestic coal supply to cement plants and a partial replacement of coke usage may be partly limiting India's overall appetite for imported coke in 2025 so far. Indian cement makers received 1.06mn t of seaborne coke in October, down by 13pc from a year earlier and lower from 1.09mn t in September, according to data from shipbroker Interocean. Cement makers' cumulative imports over January-October stood at 9.06mn t, compared with 9.42mn t a year earlier. By Ajay Modi Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US west coast coke output hits record low

04/12/25

US west coast coke output hits record low

Houston, 4 December (Argus) — US west coast marketable petroleum coke production in September hit a record low in data going back to 2005, as some California refineries move forward with plans to wind down production . Production on the US west coast totalled 323,400t in September, down by 24pc from a year earlier and off by 26pc from August, according to the latest data from the US Energy Information Administration. Refinery utilisation in the region averaged 90pc during the month, down by 3 percentage points on the year and off by 4 percentage points from August. Although Phillips 66 did not completely cease processing crude at its 139,000 b/d Los Angeles, California, refining complex until mid-October , it is possible that shutdown processes at this refinery contributed to lower US west coast coke output in September. The refinery had already idled a number of its units by the beginning of October, largely on the gasoline production side. Flaring was also reported at a number of California refineries during the month, such as Marathon Petroleum's 365,000 b/d Los Angeles refinery and Chevron's 269,000 b/d El Segundo refinery, while PBF Energy's 156,400 b/d Martinez, California, refinery was still running at partial capacity. US west coast coke output may continue to decline in the coming months, further pressured by the planned shutdown of Valero's 145,000 b/d refinery in Benicia, California, in the first half of 2026. But Marathon is spending millions to upgrade its Los Angeles complex, even as rivals shutter plants. Lower output on the US west coast contributed to a drop in total US coke production during September. Output across all regions totalled 3.1mn t, down by 6pc from a year earlier and off by 4pc on the month. Total US refinery utilisation rates averaged 93pc in September, up by 3 percentage points on the year but down by 2 percentage points from August. Production also declined significantly on the US Gulf coast, falling to just under 1.9mn t. Output dropped by 11pc on the year and by 1pc from a month earlier. But refinery utilisation in this region averaged 93pc during the month, up by 3 percentage points from a year earlier and down by 3 percentage points from August. Flaring was reported at Motiva's 626,000 b/d refinery in Port Arthur, Texas; two of ExxonMobil's Texas refineries; Phillip 66's 149,000 b/d Borger, Texas, refinery; and other plants across the region in September, which may have contributed to lower coke production. TotalEnergies was also conducting a turnaround at its 238,000 b/d refinery in Port Arthur during the month. And production decreased to 40,100t on the US east coast, down by 5pc from a year earlier but up by 11pc on the month. Refinery utilisation on the US east coast averaged 89pc in September, up by 3 percentage points on the year and down by 1 percentage point from August. Production declines across these regions offset an increase in the US midcontinent and Rocky Mountains. Output in these areas rose by 19pc and 15pc on the year in September, respectively. Refinery utilisation in the US midcontinent averaged 95pc during the month, up by 4 percentage points on the year and flat from August. US Rocky Mountain refinery utilisation averaged almost 100pc, up by 4 percentage points from a year earlier and nearly flat from the previous month. By Hadley Medlock US coke output '000t Region Sep 25 ±% Sep 24 ±% Aug 25 Jan-Sep 25 ±% Jan-Sep 24 Atlantic coast 41.0 -5 11 350.5 -7 Midcontinent 789.8 19 0 6,920.5 4 Gulf coast 1,894.4 -11 -1 16,643.4 -4 Rocky Mountains 94.2 15 -6 821.6 13 West coast 323.4 -24 -26 3,855.9 -9 US total 3,142.8 -6 -4 28,591.8 -3 —EIA Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US cement market 2026 outlook shaky

25/11/25

US cement market 2026 outlook shaky

Washington, 25 November (Argus) — The US is continuing to ramp up cement import capacity even as a demand slowdown has emerged, with policy uncertainty, especially around tariffs, creating considerable risk. "Any forecast has risk," analyst Ed Sullivan of The Sullivan Report said at last week's Intercem Americas conference in Miami, Florida. "This forecast has more risk than I can recall." An especially uncertain policy landscape is not only making the forecast shakier than usual but also increasing hesitancy among consumers and businesses. "The risks are not balanced. They are more on the downside, at least in the near term," Sullivan said. Ozinga, a concrete and cement supplier in Florida and the US midcontinent, was initially optimistic that cement demand would come "roaring back" after the November 2024 presidential election. "Then the Liberation Day thing happened, and I think that really put a pause to a lot of projects, just enough to make it very disappointing for most of the year," chief executive officer Marty Ozinga said, referring to the slate of tariffs President Donald Trump rolled out in early April. Although there has been a "measured turnaround in the last eight weeks", likely in part because "the dust is settling a bit" on US tariff announcements, "we're not going to catch all the way up by any means", Ozinga said. Tariffs have added $5-10/t of costs for US importers, On Field Investment Research managing partner Yassine Touahri said. Sullivan expects that US cement consumption fell by 5.2pc year over year in 2024 and will drop by another 4.6pc this year. His outlook for next year calls for a further 0.2pc drop, but this would be from a lower base of comparison, with 2026 likely to be the bottom at around 100mn t. But in terms of the longer-term outlook, the US is still well below its previous per capita cement consumption rates, with a forecast population growth of 30mn people by 2050, Sullivan said. At the rate of consumption of just a few years ago, the US would easily reach 140mn t market volume, he said. "It is glaring that we're nowhere near" the 30-year average in terms of cement consumption per capita, Ozinga said. "Ever since the great financial crisis, we've missed residential, and that used to be the bread and butter of everything we did." As mortgage rates remain relatively high at above 6pc and home affordability is at record lows, the residential construction sector is likely to continue to struggle. And quarterly reports from major cement players are showing a flat or even negative outlook for cement prices, making investments into the sector "pretty risky", Sullivan said. Domestic capacity utilization is only running around 76pc, which is well below the 80pc that producers would like to see, he said. Import capacity continues to rise "On the import side, capacity additions are not slowing down at all", even though demand for additional imports is much less certain than it was 3-5 years ago, LEK Consulting managing director Olivier Asset said. The amount of new and announced import terminal capacity is "not at all dissimilar to what we saw in the previous cycle in the 2000s", prior to the global financial crisis, Ozinga said. As the US domestic industry has lost market share to imports, cement companies have focused on vertical integration to control the market, Touahri said. Managing Director of FMI Capital Advisors George Reddin agreed. For those companies especially in areas near import facilities and with multiple cement plants, such as Louisiana, there is a drive to vertically integrate by acquiring ready mix concrete, Reddin said. This is part of a cycle that "happens every 15 years or so", he said. "Where the imports are is where the activity is in mergers and acquisitions," Reddin said. "Nobody wants to see their production go down, certainly no one wants to see an idle plant." Sullivan forecasts import volumes to also hit a bottom at around 17mn t in 2026, despite the large amount of new import capacity coming on line. By Lauren Masterson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Pakistan aims for record-high cement exports

25/11/25

Pakistan aims for record-high cement exports

Washington, 25 November (Argus) — Pakistan's cement exports could rise to a record high within the next two years, delegates heard at the Intercem Americas conference in Miami, Florida, last week. "We are hoping to reach 12mn t within the next two years," DG Khan Cement executive director Farid Fazal said at the conference. This would be 12pc higher than the previous record high of 10.75mn t in the 2008-09 fiscal year, before India banned imports from Pakistan. And it would be 30pc higher than the 9.21mn t exported in the 2024-25 fiscal year. The country's exports more than doubled in 2024-25 from two years earlier, as Pakistan ramped up shipments to Asia, Africa and the US. The country has more than 40mn t of surplus capacity, as cement capacity was close to 90mn t in 2024-25 while domestic consumption was below 40mn t. Despite the cement industry running at only 55pc capacity utilisation, "everybody is expanding", Fazal said. DG Khan's investment in the production of LC3 cement, a lower-carbon emissions product, could also help it better compete in the seaborne market. LC3 cement contains only 50pc clinker, with 30pc calcined clay, 15pc limestone and 5pc gypsum. The company is able to source this clay from its own quarry. The US market is increasingly moving away from traditional CEM I Portland cement, which contains 95pc carbon-intensive clinker, and towards products with a higher proportion of supplementary cementitious materials in order to achieve a lower carbon footprint. These types of blended cements with lower clinker content increased to 60pc of the US import market in 2025, up from 5pc in 2000, On Field Investment Research managing partner Yassine Touahri said. And the EU's upcoming carbon border adjustment mechanism (CBAM) import costs will push that import market further towards lower carbon cement products. The Pakistani cement industry is also leaning on the government to reduce the extensive regulatory requirements on the cement industry in order to encourage exports, Fazal said. Egyptian exports to hold steady at 20mn t Egypt, which has been ramping up cement and clinker exports sharply over the past five years, is expected to maintain total exports at around 20mn t of cement and clinker next year, if demand persists, Arabian Cement chief executive officer Sergio Alcantarilla said at the conference. Although domestic demand rose to an estimated 53-54mn t this year, up by 12pc from 2024, an increase in utilization rates should allow Egypt to maintain exports at the 20mn t plus level in 2026. The government this month approved two new licenses for 2mn t/yr of combined production, but this capacity will not come online until 2027 or 2028. Although Egypt used to be the market leader in clinker exports, this year is expected to be the first time in five years that cement exports will have exceeded clinker exports. Alcantarilla expects cement shipments to reach 12mn t this year, up from 7.6mn t in 2024, while clinker exports will fall to 8mn t from 12.2mn t last year. By Lauren Masterson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Mexico's economy contracts in 3Q

30/10/25

Mexico's economy contracts in 3Q

Mexico City, 30 October (Argus) — Mexico's economy contracted by 0.2pc in the third quarter from a year earlier, as growth in the agriculture and services sectors failed to offset a sharp downturn in the industrial sector. The contraction in gross domestic product (GDP), reported by statistics agency Inegi, was milder than the 0.4pc decline expected by Mexican bank Banorte but marked the first annual contraction of the year, following flat growth in the second quarter and a 0.9pc expansion in the first. It was also the first negative result since the first quarter of 2021. Of the three main GDP components, only the industrial sector, which includes manufacturing, construction and mining, posted a decline, shrinking by 2.9pc — its fourth consecutive quarterly fall — after drops of 1.7pc and 0.8pc in the previous two quarters. Banorte said timely data suggest construction was weighed down by civil engineering, while manufacturing was mixed, with transportation equipment — the largest component — falling. Meanwhile, "mining apparently recovered, aided by the oil sector and a positive bias in related services," Banorte said. The result added to the perception of Mexico's economy on the verge of sliding into recession. Mexico's industrial output has contracted by more than 1pc in a quarter only 12 times since 1993, and 10 of those declines were all during recessions, Banco Base chief economist Gabriela Siller said. Industrial output has now declined by more than 1pc twice this year. Agriculture expanded by 3.6pc in the third quarter, following 2pc growth in the second and 7.2pc in the first, benefiting from milder weather after last year's extreme heat and drought. Services accelerated by 1pc in the third quarter, up from 0.9pc in the previous quarter. Quarter on quarter, Mexico's seasonally adjusted GDP contracted by 0.3pc, compared with 0.6pc and 0.3pc growth in the prior two quarters, Inegi said. Banorte expects a "rebound in momentum" in the fourth quarter, supported by new federal infrastructure projects and a possible improvement in trade dynamics as US-Mexico-Canada free trade agreement negotiations advance. By James Young Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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