Gypsum industry news

Australia: USG-Boral’s earnings have fallen due to a poor construction market in South Korea. Its earnings before interest, taxation, depreciation and amortisation (EBITDA) fell by 6% year-on-year to US$170m in the financial year to 30 June 2019 from US$181m in the previous year. Its revenue grew by 2% to US$1.08bn from US$1.06bn. The joint venture said that, excluding South Korea, earnings were ‘steady’ as lower earnings from Indonesia, China and the Philippines were offset by increased contributions from Thailand, Vietnam and India, as well as a continued strong contribution from Australia.

The company also announced that Boral has entered into an agreement with Germany’s Knauf to form an expanded 50:50 plasterboard joint venture in Asia and for Boral to return to 100% ownership of USG Boral Australia & New Zealand. Completion of the deal is subject to regulatory approval. It follows the acquisition of USG by Germany’s Knauf in early 2019.

India: Bharat Heavy Electricals (BHE) has been awarded two flue gas desulphurisation (FGD) system orders at a value of for just under US$350m two thermal power plants. The orders involve supply and installation of FGD systems for 13 coal based units at the 2600MW Korba STPS Stage I, II & Ill in Chhattisgarh and the 2100MW Ramagundam STPS Stage I & II in Telangana. BHE's scope of work includes design, engineering, civil works, supply, erection and commissioning of wet FGD system along with auxiliaries, including limestone and gypsum handling system and wet stack on a full engineering, procurement and construction basis. The orders follow a contract awarded in July 2019 to supply a FGD system for the Nabinagar Thermal Power Project.

Chile: Germany’s Knauf plans to invest US$11m towards increasing the rate of gypsum extraction at a quarry its subsidiary Yesos Andinos operates at the Rubí deposit, in in San José del Maipo, Cordillera Province. The company said in an Environmental Impact Study (EIA) that it wants to raise extraction to 0.4Mt/yr, according to ValorFuturo. At present it is restricted to 35,000t/yr at the site.

Australia/US: USG-Boral will resume 100% ownership of its Australia and New Zealand gypsum wallboard operations, subject to a call option for Knauf to buy back 50% within five years.

Boral CEO Michael Kane has commended Boral’s Sheetrock brand’s substantially strengthened position by comparison to that at the time of Knauf’s US$7bn acquisition of USG in April 2019, since which time Knauf has held 50% of USG-Boral’s gypsum wallboard business in Australia and New Zealand.

Boral will continue its joint operations with Knauf across Asia, at the centre of which are USG-Boral Asia’s purchase of Knauf Asian Plasterboard for US$533m, and its sale of its Middle Eastern ventures to Knauf for US$50m.

Tanzania: Knauf Gypsum Tanzania has signed a five-year agreement with the Tanzania Petroleum Development Corporation (TPDC) to supply gas for a gypsum plant it is building at Kisemvule, Mkuranga District. The arrangement will started at the end of 2020, according to the Daily News newspaper. Commissioning at the plant is expected to start at the end of August 2019.