Global lime industry facing headwinds on depressed manufacturing sector; outlook remains cautiously optimistic
Greenwich (Conn.), USA, October 26, 2016 ÔÇô In 2016, worldwide demand for lime, constituting largely of quicklime, but also of slaked and hydraulic lime, slid by 10 million from the 2014 peak to 350 million tons. However, supported by an anticipated recovery of the steel industry ÔÇô which consumes almost 50 percent of the lime used at the global level ÔÇô worldwide demand for lime is projected to show modest recovery by 2021, according to CW Research's study on ÔÇ£Global Quicklime, Slaked Lime, and Hydraulic Lime Market Report.ÔÇØ
ÔÇ£The lime industry has traditionally been relatively stable due to a diversified range of cyclical and non-cyclical applications. As such, in a glass half-full sort of view, although there has been a contraction in demand following a slowdown in global manufacturing, it has not been as severe as that for other sectors such as cement. Conversely, while there are also glimmers of favorable long-term opportunities, notably the growth in environmental and flue gas desulphurization uses in developing markets, we see tempered growth going forward on a global basis,ÔÇØ says Robert Madeira, CW Group Managing Director and Head of Research.
Overall, CW Research explains in the ÔÇ£Global Quicklime, Slaked Lime, and Hydraulic Lime Market ReportÔÇØ that the weakness in lime consumption is forecast to continue until steel production stabilizes in 2018. Moreover, environmental applications (including flue gas desulfurization (FGD), water, and waste and soil treatment), construction, paper and pulp, mining and minerals, agriculture, petrochemical applications, sugar and others will add to lime demand. CW Research projects worldwide demand to expand by less than two percent per year on average through 2021.
ÔÇ£On the supply-side, the industry structure for lime manufacturing is organized quite differently across nations. , Some markets, including China, Russia, and India are highly vertically integrated with steel and aluminum companies largely operating their own quicklime production plants. On the other hand, metallurgical companies in Europe, Brazil, and the US source virtually all quicklime production from commercial suppliers. In fact, the trend in these markets has long been for lime units to be divested to companies specialized in lime production such as Carmeuse and Lhoist for improved core business focus,ÔÇØ noted Raluca Cercel, lead analyst for the study.
China will continue to be the largest lime market, representing about 60 percent of global production. China's steel sector is working through a challenging period of overcapacity and weak domestic and international demand. While an estimated 90 million tons of steel capacity was rationalized in the 12th five-year plan, an additional 100-150 million tons is expected to be shut down through 2020. Europe, the CIS, and the Americas each account for about ten percent of global production, followed by Africa and the Middle East, both representing five percent of total lime production. Notably, in Brazil's case, in spite of the depressed macro-economic environment and low steel production levels, manufacturers of lime expect demand to be resuscitated by growth in the agriculture and sugar cane sectors.
Globally, road construction, metallurgy and ore extraction are expected expand the fastest of all segments at four percent and three percent, respectively, per year on average for the next five years. In developed markets, FGD has traditionally accounted for a significant share of lime consumption. Yet the outlook for FGD-linked demand is complex as coal power generation is facing dual challenges. On one hand, the retiring of coal-fired power plants in favor of renewable electricity will demand fewer FGD systems. On the other hand, reliance on coal as a main electricity source will in some markets increase (and thus drive FGD system expansion and lime demand) with phasing out of nuclear-based power. Furthermore, some markets, such as Germany, face both challenges, creating some uncertainty around the net effect for lime consumption.
While most of the world's lime demand is met by domestic production, less than three percent of consumption was supplied through imports in 2015. The primary lime exporters were Vietnam, Germany, France, Belgium and Oman, which together exported over forty percent of the total lime traded.
The Netherlands and India are the world's largest lime importers, having together imported around two million tons of lime in 2015. India's lime consumers are dependent on high quality lime coming from neighboring Asian markets such as Malaysia and Vietnam, as well as from the UAE and Oman. Notable is the recent resolution to Australia's Cockburn Cement withdrawing its dumping charges against suppliers from Vietnam and Malaysia.
From a company perspective, Carmeuse and Lhoist are the global leaders. Carmeuse operates fourteen plants in the United States, followed by presence in fifteen European countries, as well as in Asia and the Middle East. Lhoist operates at more than one hundred locations, out of which seventeen plants are located in the United States. Besides these two global champions, the balance of companies are either regional medium sized groups as well as local, typically single unit companies. Some of the notable regionals include Graymont (North America), Grupo Calidra (Mexico and South America), Fels Werke (Germany) and NordKalk (Scandinavia).
ÔÇ£There are several challenges that will impact the global lime industry in the coming years. Some notable challenges are in targeting new business opportunities and faster growing segments, reducing cost structures in developing markets and automating plant operations, improving production costs as well as the ever growing emissions and environmental pressures,ÔÇØ added Robert Madeira.
For more information and placing an order, please contact Liviu Dinu, Market Services & Marketing Consultant, CW Group (Europe), by phone at +40-744-67-44-11, or e-mail at [email protected].
The CW Research's Global Quicklime, Slaked Lime and Hydraulic Lime Market Report is a comprehensive market research report providing in-depth assessment and outlook for the world market for quicklime, slaked lime and hydraulic lime through 2021. The report provides detailed market sizing in a quantitative and data-rich format to provide reliable and accurate decision support. Key areas such as demand by industry end-user segments, product price dynamics, and competitive landscape for major lime markets and worldwide industry are extensively covered.
Lime consumption is projected to give a rigorous outlook for both major countries and the world in both USD and tons. The detailed data and analytical insights allow readers to develop strategic directions, competitive strategies and position their business to evolve with the industry and capture opportunities.
The report addresses important market dynamics for the different industries that utilize lime, including the major sub-segments of quicklime, hydrating lime, and slaked lime across regions and major producing countries. The report profiles major world lime manufacturers including Carmeuse, Graymont, Grupo Calidra, Fels Werke, Lhoist, and Nordkalk. Additionally, local champions are highlighted in each study of the major markets, including Australia (Adelaide Brighton), Brazil (ICAL), China (Shandong CITIC) Germany (Schaefer Kalk), India (Tata Steel, ShreeRam Lime), Italy (Unicalce, Saced), Japan (Ashidachi Lime), and Russia (Novo Lipetsk Steel, Bashkir Soda). Additionally South Korea (Jeongseon Lime), South Africa (PPC Lime, Idwala), Turkey (NUR Kireç, KIMTAS), UAE (Al Noora, Emirates Lime Factory), and the US (Mississippi Lime, United States Minerals) are also profiled in the report.
The report was developed through an extensive set of interviews with key industry stakeholders in main markets (including US, Mexico, Brazil, Europe, Africa, India, Russia, China, Australia, Middle East) and companies (including major global lime manufacturers, equipment suppliers, traders, analysts, production engineers, industrial lime users and association members).
The report is divided into regional demand (USD and in tons) as well as product segments, providing a strategic perspective on the evolution and outlook for the industry, including steel, construction, paper & pulp, mining & minerals, agriculture, petrochemical applications, precipitated carbonate and others. For more information: http://www.cwgrp.com/research/research-products/product/111-global-quicklime,-slaked-lime-and-hydraulic-lime-market-report-forecast-to-2021.
CW Research is a leader in syndicated and data-driven market research solutions. The company offers independent perspectives on multiple industrial market segments (e.g., cement, metals & minerals, and specialty chemicals) and deep functional expertise in market intelligence, sourcing intelligence, commodity-pricing intelligence. CW Research also provides custom industry and competitive research programs for operating companies, financial analysts, consultants, governments, suppliers and many others as well as tailored studies together with CW Advisory.
The Greenwich (Conn.), USA headquartered CW Group is a leading advisory, research and business intelligence boutique aligned along three pillars: Advisory, Research, and Media. CW Advisory supports senior management in addressing their most challenging strategic, financial, and operational issues as well as providing M&A advice. CW Research provides value added industry reports, multi-client studies and business research services. The Media pillar is based on rigorous and up-to-date information and data management, providing market updates to our clients in a self-service format through our industry portals as well as industry meetings.
The CW Group, with a presence in the US, Brazil, India, Portugal and Romania, has a multi-industry orientation, with particularly recognized sector expertise in up-stream building materials (cement, lime), downstream building materials (aggregates, ready-mix, cementitious - fly ash, slag), power and energy, steel, minerals & mining, agriculture and commodities, paper & pulp, ports, logistics & transportation. www.cwgrp.com