Gypsum industry news

China: BNBM’s operating income grew by 25% to US$3.33bn in 2021 from US$2.66bn in 2020. Its net profit rose by 23% to US$554m from US$451m. Its production and sales volumes of gypsum wallboard increased by 19% to 2.43Bnm² and 18% to 2.38Bnm² respectively. It reported a gypsum wallboard production capacity utilisation rate of 78%. The group added that data from the Gypsum Building Materials Branch of China Building Materials Federation showed that national wallboard production capacity was 4.90Bnm²/yr and that production and sales were 3.51Bnm² in 2021.

Parent company CNBM separately reported that the group raised its average wallboard selling prices by 7%. It said it put up its prices in the reporting period due to high prices of coal, gypsum, paper and other raw materials. Internationally, the group said that a new wallboard plant in Tanzania had started operation in 2021 and that a new plant in Uzbekistan is still being built.

France: Placo and Serfim Recyclage have revealed that they started operating a new 140t/day plaster recycling plant at Quincy-Voisins near Paris in October 2021. The companies say that the Pari Plâtre site is the first in the Paris region to be solely used for recycling plaster waste from construction sites.

Daily deliveries via the Placo Recycling network bring plaster waste from within a 250km radius to the site. The waste is then sorted by hand along an 80m production line to remove wood, ceramic, cardboard and polystyrene fractions. These materials are recycled separately. The plaster is crushed and screened with a 98% recovery rate. The plant stores reclaimed gypsum in two 80m³ silos. The gypsum is then transported to Placo’s gypsum wallboard plant at Vaujours for use as a secondary raw material.

Placo says it is the leading recycler of gypsum in France. Following the opening of Pari Plâtre the company has increased its plaster recycling target in 2030 target to 200,000t/yr. This will allow the subsidiary of Saint-Gobain to use up to 30% of recycled materials in the production of its wallboard products.

UK: Etex has awarded a contract for construction of its new Euro167m Bristol gypsum wallboard plant in North Somerset to McLaughlin & Harvey. The plant will include a post-consumer gypsum recycling facility and is scheduled for commissioning in 2022.

Russia/Ukraine: Jörg Schanow, a member of the management board of Knauf, says that the company has no plans to leave the Russian market. In an interview with the Süddeutsche Zeitung newspaper he said that Russian production sites were still running as normal.

The company has set up crisis management team since the start of the war in Ukraine in late February 2022. It has been meeting daily and discussing the situation with local management in Russia. Schanow said that the biggest business problem so far was the effect of US and European economic sanctions upon Russian banks and the consequences upon moving money between banks, suppliers and customers. The Germany-based company employees 3900 staff at 14 sites in Russia. It originally purchased a gypsum plant at Krasnogorsk near Moscow in 1993.

Knauf also has operations in Ukraine. It closed its gypsum wallboard plant in Donbass in response to the current war on 24 February 2022 ‘as a precaution,’ according to the TZ newspaper. The staff were sent home and the plant will remain closed into further notice. The plant had 589 employees at the end of 2021, none of whom where German nationals.

France: Saint-Gobain’s sales grew by 15.8% year-on-year to Euro44.2bn in 2021 from Euro38.1bn in 2020. Its earnings before taxation, interest, depreciation and amortisation (EBTIDA) rose by 41% to Euro6.20bn from Euro4.42bn. Sales and earnings increased by 4% and 27% compared to 2019 levels before the coronavirus pandemic started. Sales revenue and operation income was reported up in all geographical regions. In North America the group noted that the integration of Continental Building Products had boosted its position in the US gypsum wallboard market and helped it to tap new sales channels.

“The records achieved in 2021 confirm that the group has entered a new post-transformation trajectory in terms of performance: market-beating sales growth, record earnings and margins, a high level of free cash flow generation that has more than doubled compared to previous years, and strong value creation for our shareholders thanks to strict capital allocation and the determined execution of our portfolio optimisation,” said Benoit Bazin, the chief executive officer of Saint-Gobain.

The group completed or signed 37 acquisitions in 2021, including Chryso and GCP Applied Technologies (GCP), marking its rapid expansion into the construction chemicals market. In November 2021 On November 15, 2021, Saint-Gobain said that it had acquired a gypsum plant in Nairobi, Kenya. It will be the company’s first production site in Kenya, where it will also invest in a construction chemicals production line.

Canada: Irving Wallboard is preparing to rejoin the local gas distribution network near to its plant at Saint John in New Brunswick. The company has been offered a special low rate as an incentive to return, according to the Canadian Broadcasting Corporation. In an interview Gilles Volpé, the vice-president of Liberty Utilities, the operator of New Brunswick's gas distribution network, said that these kinds of arrangements sometimes occurred with industrial end users. The proposed deal would see it use at least 600,000GJ/yr of gas making the wallboard producer Liberty Utilities’s largest customer.

The company, which also operates under the name Atlantic Wallboard, was previously the largest individual customer on New Brunswick's public gas distribution system but it left in 2015 in a pricing dispute. It then switched to using compressed gas delivered by truck.

An application has been made to the New Brunswick Energy and Utilities Board and a full hearing into the proposal is scheduled for April 2022.

Bosnia and Herzegovina: State-owned power company RiTE Ugljevik has agreed to supply 250,000t/yr of gypsum for Beijing New Building Materials (BNBM)’s upcoming Ugljevik gypsum wallboard plant in Semberija Region. The power supplier produced 300,000t of flue gas desulphurisation (FGD) gypsum in 2022.

New Zealand: Revenue from Fletcher Building’s Building Products division rose by 9% year-on-year to US$514m in the first half to 31 December 2021 from US$471m in the same period in 2020. Earnings before interest and taxation (EBIT) fell by 6% to US$68.6m from US$64.6m. The building materials producer, distributor and construction company blamed the declining earnings on a coronavirus-related lockdown in the summer of 2021, although it noted improved performance in the following quarter. Overall group revenue and earnings grew in the reporting period.

“With improved operational performance and cost disciplines now embedded across the business, we were able to deliver a strong performance. This was despite the first quarter being heavily impacted by the up to five week-long Covid-19 stringent lockdown in New Zealand and local lockdowns in Australia which impacted EBIT,” said Fletcher Building’s chief executive officer Ross Taylor.

Fletcher Building’s subsidiary Winstone Wallboards is currently building a new 10Mm²/yr gypsum wallboard plant at Tauriko near Auckland. Commissioning is planned for the group’s 2023 financial year that starts in June 2023. Once completed the company says it will have a total national wallboard production capacity of 40Mm²/yr.

Kazakhstan: France-based Alphaplatre has won an order to supply a plaster tile production line for Alina. The scope of supply includes preparation and mixing, tile molding, drying and semi-automatic palletisation. No commissioning date has been released.

BNBM has announced two overseas gypsum wallboard plants since the start of 2022. In Early January 2022 the China-based producer said it was going to build a 40Mm²/yr plant in Thailand as part of a joint-venture with Sinoma International Engineering and its subsidiary Sinoma (Thailand). Notably the unit is also to be equipped with a decorative gypsum line. The estimated project investment is US$55m. Then, in February 2022 BNBM revealed plans to build a 40Mm²/yr gypsum wallboard plant in Bosnia & Herzegovina. This one is a joint venture with Rudnik i Termoelektrana Ugljevik (RiTE Ugljevik), a subsidiary of the local state-run power company. The project will be situated next to the coal-fired power plant at Ugljevik. No surprises then for what source of raw gypsum the wallboard plant is likely to be using! The estimated project cost is Euro50m.

These two projects join a pair of other plants the producer is also cooking up internationally. In mid-2019 it revealed new wallboard plants in Tanzania and Uzbekistan. The former is a 15Mm²/yr plant to be run via a subsidiary. It was reported to be in a construction phase in mid-2021. The latter is a 40Mm²/yr gypsum wallboard plant to be built in the Kokand Free Economic Zone, Fergana Region in Uzbekistan via a wholly-owned subsidiary. So far it is reportedly in the preparation stage. The company also has a number of wallboard plant projects in development at home in China, including plants currently being built at Shuozhou in Shanxi province and Yichang in Hubei province.

During the first half of 2021, BNBM’s operating income rose by 46% year-on-year to US$1.59bn from US$1.09bn. 65% of this was generated from its gypsum wallboard business sales. Overall, parent company CNBM reported gypsum wallboard sales of 2.01Bm2 in 2020 from BNBM and Taishan Gypsum.

A subsidiary of CNBM building production capacity outside of China will sound familiar to those readers who follow the cement industry. The industry has been using the Belt and Road Initiative to move redundant domestic capacity abroad as the local market has become saturated and environmental measures bite. Chinese cement production capacity per capita has seemed extraordinarily high by international norms over the last 20 years. Yet, gypsum wallboard production capacity per capita is a wildly different story. Global Gypsum Directory 2021 data suggests that the US had a rate of 12.7m²/capita compared to 2.4m²/capita in China.

With this in mind it makes one wonder why BNBM is bothering internationally given the market scope at home as China meets its climate commitments. As the move by some western multinational building material companies over the last year or so suggests, the future may lie in light building materials. On the other hand BNBM/CNBM may simply have its eye on the bigger picture. Just like its international competitors, it doesn’t want to miss out on the opportunity for market enlargement or being left behind if the ratio between heavy and light building materials switches. If it really means business, then the next steps could be wallboard plants in Western Europe or even the US. A US-based joint-venture for BNBM might help to make everyone forget the unending legal debacle with Taishan’s imports.