Gypsum industry news

Australia: Knauf Plasterboard has started building a new wallboard plant at the Port of Bundaberg, Burnett Heads, Queensland, according to local media. The project was announced in January 2016 and was subject to approvals before construction could start.

The project comprises the construction and operation of a wallboard plant at the Port of Bundaberg, including gypsum handling and processing facilities to support wallboard production and for on-sale of gypsum into the agriculture sector.

The project has been made possible by funding from the Queensland Government for the construction of a 26km gas pipeline from the Australian Gas Network's Wide Bay gas transmission line at Bundaberg to Burnett Heads. This gas supply supplies capacity for the Knauf plant and other industrial users in the region.

"Knauf is very pleased to be playing its part in working collaboratively with the State Government to help build new industries and boost regional and state economies," said Knauf CEO of Asia Pacific, Murray Read. He added that the Bundaberg plant was a great investment for Knauf, as it expanded Knauf's wallboard manufacturing network into Queensland to better serve its customers, create additional trade through an under-utilised port facility, support regional development and, in partnership with the State Government, helped to develop critical infrastructure for Knauf and other industrial users in regional Queensland.

The plant is expected to create up to 200 jobs during the construction of the plant and around 55 new positions when operational.

Australasia: LafargeHolcim is believed to be considering an exit from Australia and New Zealand, with the region under the spotlight as part of a strategic review globally of non-core assets. It is understood that a private equity firm has already made an approach for some assets, amid a period of global consolidation in the industry.

Lafarge sold its Australian gypsum operations four years ago for US$127m to Knauf, but Holcim has remained one of the most dominant suppliers in the Australian and New Zealand market of aggregates, concrete and concrete pipe and products. While the division is likely to be too large for Boral, it may pursue parts of the business or partner with another buyer to secure some of the LafargeHolcim assets. However, it is believed that the most likely acquirers include CRH and Votorantim.

Australia's construction industry has been enjoying strong conditions on the back of a recent boom in residential house prices in Melbourne and Sydney. Brickworks, the country's largest brick and tile maker, recently flagged a lift in its earnings for the 2016 financial year on the back of the strong momentum in its building products group.

Chile: Knauf Gips KG has purchased a gypsum quarry from cement producer Cementos Bio Bio for US$20m. The acquisition will allow Knauf to consolidate its presence in South American. The company, which already owns three gypsum plants in Argentina, Brazil and Colombia, plans to expand its geographical reach to Ecuador, Venezuela, Central America and the Caribbean.

Russia: Knauf has begun the construction of a Euro16.8m gypsum dry building mix plant in Chapayevsk, Samara. The plant is expected to be commissioned at the end of 2016. The 170,000m² plant area is under municipal ownership and will be leased by Knauf for 49 years. The plant will be Knauf's 15th production enterprise in Russia.

"In the region there is a raw materials base, which is important for Knauf. As there is quite a large amount of construction in the region currently, construction materials producers are needed. We understand that it is much more advantageous to localise production here, than to transport materials from other regions and engage in, in particular, international logistics," said Samara's Regional Economic Development Minister Alexander Kobenko. "It is planned for the plant to reach full capacity in two and a half years. It will produce about 240,000t/yr of gypsum binder and 130,000t/yr of building mixes. This is about Euro25m/yr," said Kobenko.

Europe: USG has entered into a definitive agreement for the sale of its interest in Knauf-USG Verwaltungs GmbH and Knauf/USG Systems GmbH and Co KG to Knauf Aquapanel GmbH for approximately Euro48m in cash.

The Knauf-USG joint venture manufactures and distributes Aquapanel brand cement panels throughout Europe (excluding Turkey) and all countries that were part of the former Soviet Union.

USG's equity method income in the Knauf-USG joint venture amounted to Euro1.79m for the year that ended on 31 December 2014. Upon the close of the transaction, USG anticipates recording a Euro2.68 – 6.26m gain. The closing of the sale is subject to the receipt of necessary governmental approvals and other customary closing conditions and is expected to take place by the end of 2015.

UK: The Carbon Trust has awarded Knauf UK the Carbon Trust Standard for Carbon in recognition of its success in reducing its carbon emissions. The Carbon Trust is the world's leading independent certification organisation and the award is a step forward for the gypsum industry as a whole.

"We're particularly proud to have achieved the Carbon Trust Standard because it reflects the company's commitment to sustainability throughout its operations," said Lorna Stork, Knauf UK's sustainability manager. "We manufacture products that are energy-intensive to produce, so this achievement not only owes a lot to improvements at factory level, but also shows that we believe in managing carbon and energy use in other areas."

Knauf has re-formulated the composition of its wallboard to reduce water content and the energy consumption required to dry them. The result is that, across the company, the average board weight has fallen by 2% over the past five years, leading to a cut in energy consumption of over 5%. Knauf has also achieved considerable energy savings in the drying process. 10GWh of gas were saved at the company's Kent facility and a further 2.8GWh at its Hull plant. These savings have been reinforced with other initiatives, including the implementation of ISO 50001, energy targets for board production, monitoring programmes and sourcing lower moisture raw materials.

Knauf has also examined other elements of its business in terms of carbon use, including handling and distribution. There have been marked improvements in Knauf's own energy consumption by forklifts and other site vehicles due to monitoring of fuel usage and training staff on how to operate the plant and equipment optimally.

"Knauf's attitude towards carbon reduction is commendable and the company's efforts have led to a significant reduction of over 5%. The company is an example of what can be achieved going beyond business-as-usual and innovating to improve your environmental impact," said Darran Messem, managing director of certification at the Carbon Trust. "Achieving the Carbon Trust Standard is one thing, but keeping it is a constant task, not one that is achieved by a single initiative. As a company, we are committed to that aim and to everything that it implies."

Belarus: Belarusian gypsum wallboard demand will decrease by 12.5 - 17% in 2015, according to OJSC Belgips and FLLC Knauf Marketing, key players in the country. According to the companies' executives, the fall is a consequence of reducing funding of the construction industry and a decline in commercial real estate.

"In 2014, gypsum wallboard consumption in Belarus amounted to about 12Mm². In 2015, we estimate that the consumption will decrease to 10 - 10.5Mm²," said the director of Belgips, Stanislav Babitsky. The director of FLLC Knauf Marketing Alexander Babkin confirmed the 2014 market size at 12Mm² and said that he expects demand in 2015 to fall to 10Mm².

The head of corporate communications of Knauf for the Commonwealth of Independent States (CIS) Leonid Moose said that the main consumer of wallboard in Belarus was the business-to-business (B2B) sector, namely, the commercial real estate market. Out of the total wallboard consumption, the B2B sector had 70%, while the business-to-consumer (B2C) sector had 30%.

"The commercial real estate market is falling, while the population is beginning to save money and invest it in repairs. For this reason, we are observing the fall of consumption of gypsum wallboard and, at the same time, the growth of consumption, in particular, of dry building mixes, whose main consumer is the B2C sector," said Moose. "Meanwhile in Europe, wallboard is being increasingly used for partitions in individual building more than in Belarus."

Meanwhile, the demand for gypsum wallboard from the population has intensified, according to Babitsky. "The consumption of wallboard is increasing due to the growth in framed-monolithic housing in Belarus. During the last two years, the consumption growth was 20%. It smoothes the fall in demand from the commercial sector," said Babitsky. He added that another negative factor on the Belarusian market is the increased competition on the part of Russian players because of the Russian Ruble devaluation and the Russian wallboard market narrowing. Russia's wallboard production is around 600Mm²/yr, while consumption is 250Mm². As such, exports to Belarus have increased.

Belgips plans to develop new products for sale on the domestic and export markets. According to Gubanova, the company is considering entry into Lithuania and Latvia.

Colombia/Germany: Knauf International GmbH has announced that a definitive agreement has been signed with Gyptec, a Colombian wallboard producer, to acquire the assets of the company. As well as in Colombia, Gyptec has interests in Venezuela, Ecuador and Central America. The transaction also includes Hanetec, a supplier of building products associated with wallboards.

Serge Azaïs, member of the Knauf Management Committee in charge of South America, said, "It is a very significant move for our group to be part of the development of the northern part of South America, after our industrial presence for 15 years in Brazil and Argentina. We are extremely confident of the potential of this zone. We will very shortly increase capacity in order to deliver to Central America and the Caribbean countries from the facility in Cartagena. We look forward to welcoming the Colombian team into the Knauf family."

Russia: CJSC Knauf Gips Baskunchak, based in the Astrakhan region, plans to start developing the Kashara-Tugai gypsum deposit before the end of 2015, according to company director Sergei Michkov.

"We are commissioning the Kashara-Tugai deposit, located north of Lake Baskunchak. We have received the development license and the documentation has been agreed. The reserves are quite large: it will support production for 100 years," said Michkov in comments reported on by Interfax.

Astrakhan region has reported 67.5Mt of gypsum registered on its state records. Knauf Gips Baskunchak had a total of 111Mt of gypsum reserves recorded at the start of 2015. Knauf Gips Baskunchak, which joined the Knauf group in 1998, produces high-quality dry mixes from gypsum and supplies gypsum to Russian cement plants and other enterprises.

Australia: The Gladstone Port Corporation has approved construction of a US$54m Knauf Plasterboard manufacturing plant at Bundaberg Port, Queensland to begin by the end of 2015. The project is anticipated to create up to 100 local jobs over the next 18 months, according to local media. The plant is due to be completed in January 2017.