This document provides an overview of opportunities and challenges in the Iraqi cement industry. It summarizes that Iraq has significant cement production and consumption, but remains a large importer due to postwar infrastructure needs. Several new cement plants and capacity expansions are planned in Iraq over the next few years from companies like Lafarge and MASS Global. However, the industry faces challenges from Iraq's political instability, unreliable power sources, and use of outdated wet process technology at some plants. The presentation concludes with background on Lucky Cement, a leading Pakistani cement producer that is establishing a new grinding plant in Basra, Iraq.

1. Opportunities & Challenges in
Iraqi Cement Industry
Presentation by:
Muhammad Asadullah
Manager Export Marketing
Lucky Cement Limited
Pakistan

2. Baghdad - Iraq
Haifa Street, as seen from the Medical City Hospital across the Tigris River

3. Agenda

Summary Statistics & Strategic Location of Iraq

Brief History of Iraqi Cement Industry

Cement Consumption in Iraqi Cement Market

Players-wise Location of Cement Plants in Iraq

Capacity Additions: Greenfield Plants & Rehabilitation

Challenges and Issues in Iraqi Cement Market

Iraq as World’s Largest Cement Importer

Brief intro of Al-Mabrooka Cement (Basra – Iraq)

Lucky Cement’s as Market Leader in Pakistan

World’s Leading Cement & Clinker Exporters in 2012

4. Summary Statistics for Iraq and its Cement Industry
GDP (2013 est.)
US$150 bn
Area
438,317km2
GDP/capita (2013 est.)
US$4,272
Cement produced (2012)
7.5 Million Tons (Mt)
Population (July 2012)
31.1m
Cement imported (2012)
10.5 Mt
Official Oil Reserves
143bn barrels
Per Capita Cement
Consumption
489 kg
(Global Cement Report)
Sources:
Wikipedia
& Global Cement Report

5. Strategic Location of Iraq

6. History of Iraqi Cement Industry: 1955 - 2003

Badoosh Cement Plant established in 1955

Many plants added over the decades especially in the 1970s and 1980s

Iraq briefly exported cement in the mid 1980s

Until 2003 all of the plants were run by the state:


Iraqi State Cement Co. (Baghdad)


Northern State Cement (Mosul)
Southern State Cement (Kufa)
In 2003, the cement sector split into:



Former State-run Plants
And New Private Operators
In 2005, Ministry of Industry and Minerals promulgated an ambitious
licensing program

7. Cement Consumption in Iraq
Source:
International Cement Review & Global Cement Report

8. Salient Features of Iraqi Cement Market

Approx. 18 million tons of cement consumed in 2012:


Locally manufactured
Imported cement
7.5 Mt (42%)
10.5 Mt (58%)

Iraq is worlds largest cement importer and will remain net importer in near future.

Iraq has got natural limestone that is of high quality (high percentage of CaCO3).

Iraq's limestone is close to the surface, allowing low-cost mining.

Evenly distributed Cement Plants reflecting the wide availability of raw material.

Neighboring Turkey and Iran are leading suppliers to Iraq

An anticipated 15Mt/yr of cement capacity to be added in next few years

9. Eighteen Governorates/Provinces in Iraq
Turkey
Governorate
Al Anbar
Arbil
Total area
km2
138,501
15,074
Population
Jan 7, 2011
Capital
1,561,400 Ramadi
1,612,700 Erbil
Babil
Syria
Iran
5,119
1,820,700 Hillah
Baghdad
4,555
7,055,200 Baghdad
Basra
19,070
2,532,000 Basra
Dhi Qar
12,900
1,836,200 Nasiriyah
Diyala
17,685
1,443,200 Baqubah
Dohuk
6,553
1,128,700 Dohuk
Karbala
5,034
1,066,600 Karbala
Kirkuk
9,679
1,395,600 Kirkuk
Misan
Muthanna
Najaf
16,072
51,740
28,824
971,400 Amarah
719,100 Samawah
1,285,500 Najaf
Nineveh
37,323
3,270,400 Mosul
Al-Qādisiyyah
8,153
1,134,300 Al Diwaniyah
Saladin
17,023
1,878,800 Sulaymaniyah
Wasit
Kuwait
1,408,200 Tikrit
Sulaymaniyah
Saudi Arabia
24,751
17,153
1,210,600 Kut

10. Players-wise Location of Cement Plants in Iraq
Lucky Cement
Asec Cement
Al Rawi Group
Sinjar plant
+0.9mt improvement taking place. To be
commissioned in mid-2013 to 1.8mt
capacity.
ASEC
0.9mt plant to be commissioned in 2014.
Iraqi Cement State Co.
MASS Global
3rd kiln of 1.8mt planned for 2013. Total
plant capacity at Sulaimaniya 5mt.
Northern Cement State Co.
Lafarge
Southern Cement State Co.
Lafarge
1.2mt Kerbala plant expansion to be
commissioned in 2014.
MASS Global.
Sinjar plant
Independent Iraqi Firm
An Iraqi firm intends to build a plant
together with an Italian firm. Capacity &
commissioning details not yet disclosed.
Independents*
Capacity addition
Capacity addition but
no confirmed date of
commissioning
Al Doh company
2mt grinding plant is planned in Sarnawa
for 2013.
Grinding plant
< 0.5 mt
0.5 – 1.5 mt
1.5 – 2.5 mt
Lucky Cement, Pakistan / Al
Mabrouka Company
0.9mt grinding plant is planned in
Basra for 2013.
> 2.5mt
Source:
Exane BNP Paribas

11. Capacity Additions by New Cement Plants
Company/Group
Location
Mabrooka (LCL)
Basrah (GU)
Tasluja and
Bazian
Muthanna
Sulaymaniah
Muthanna
Karbala
Najaf
Harir, Arbil
Lafarge
Al Douh
MASS Global
Qemmat Iraq
Lafarge
MASS Global
Limak
CCI: Lebanese
Group
Arbil
TOTAL
Cement
Capacity,
Mio t
1.00
Most Likely
Commissioning
Year
2013
1.42
2013
1.50
2.06
1.62
2.00
1.50
1.50
2013
2014
2015
2016
2016
2016
1.50
2016
14.10
Source:
Holtec Consulting Pvt Ltd,
www.holtecnet.com

12. Capacity Addition by means of Rehabilitation
0.36
Likely
Commissioning
Year
2013
Tamim
Ninawa
Najaf, Babil,
Southern Cement State’s Plant
Muthanna, Basrah
Badoosh Cement Plant
Ninawa
Sinjar Cement Plant
Ninawa
0.12
0.10
2013
2013
0.50
2013
0.68
1.27
2014
2014
Kubaisa Cement Plant
1.00
2015
Group
Location
Qaim Cement Plant
Al Anbar
Kirkuk Cement Plant
Hammam Cement Plant
Al Anbar
TOTAL
Cement Capacity,
Mio t
4.03
Source:
Holtec Consulting Pvt Ltd,
www.holtecnet.com

13. Challenges and Issues in Iraqi Cement Market

General Political Environment

Uncertainty surrounding future development of Iraq

Lack of consistent sources of power

Reluctance of Specialists to live in Iraq.

Problems with the Safety of Personnel

Old Technology (Wet Process Plants)

Lack of Servicing and Maintenance

14. World’s Leading Cement & Clinker Importers in 2012
S. No.
Country
Million Tons
World's Leading Cement & Clinker Importers
10.50
12.00
Bangladesh
8.71
10.00
3
USA
7.04
8.00
4
Afghanistan
5.60
6.00
5
Myanmar
4.80
4.00
6
Singapore
4.75
7
Sri Lanka
4.18
1
Iraq
2
2.00
-
8
Russia
4.00
9
Ghana
3.77
10
France
3.75
Source:
The Global Cement Report, 10th Edition

15. Al-Mabrooka Cement

Al-Mabrooka Cement is jointly owned by M/s Lucky Cement
of Pakistan and M/s Al-Shumookh of UAE.

A grinding unit with an annual capacity of 870,000 metric tons

Trial Production is planned to start by end of the year

It is strategically located in Basrah

Al-Mabrooka Cement will cater to local market

Many ongoing & upcoming projects that will require cement

16. Al-Mabrooka Cement

17. Al-Mabrooka Cement

18. Lucky Cement Ltd (LCL) as Market Leader Pakistan

Part of Yunus Brothers Group (A leading business group of Pakistan)

Annual Production capacity 7.5 mtpa i.e. 25,000 M. Tons/day

Two Strategically Located Factories in North & South Zone

Export Licenses from NSBs (KEBS, TBS, SABS, SLSI, BIS)

Cement exported to 37 countries in:


Middle East, Africa and South Asia
Efficient Logistics & Supply Chain Management


24,000 M. Tons Storage Capacity at Karachi Port


Own Transportation Fleet for bagged and bulk cement
Pneumatic Pumping System at Karachi Port
Expansion Plans in Emerging Markets and Diversification

Grinding Unit in Iraq

Integrated Cement Factory being set-up at DR Congo

Acquired 75% shares of ICI Pakistan

19. Company-wise Production Capacities in Pakistan
Sr. No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
Name Of Unit
Lucky Cement
Bestway Cement
D.G. Khan Cement
Fauji Cement
Maple Leaf Cement
Askari Cement
Kohat Cement
GharibWal Cement
Lafarge Pakistan
Pioneer Cement
Dewan Cement
Attock Cement
Flying Cement
Cherat Cement
Al-Abbas Cement
Fecto Cement
Dandot Cement
Thatta Cement
Total
Cement Capacity
(Metric Tons)
7,512,000
5,915,250
4,221,000
3,433,500
3,370,500
2,677,500
2,677,500
2,110,500
2,047,500
2,030,250
1,921,500
1,795,500
1,197,000
1,102,500
945,000
819,000
504,000
488,250
44,768,250
Source:
All Pakistan Cement Manufacturers Association
(www.apcma.com)

20. Leading Export Markets of Pakistan in 2012
S. No.
1
2
3
4
5
6
7
8
9
10
900
800
700
600
500
400
300
200
100
-
Markets
World
Afghanistan
South Africa
Sri Lanka
India
Iraq
Tanzania
Djibouti
Madagascar
Mozambique
Comoros
Others
Tons (000)
9,011
5,158
813
777
562
498
395
207
203
146
143
110
Statistics as per ITC
www.trademap.org
HS Code 2523 (Cements)

21. World’s Leading Cement & Clinker Exporters in 2012
S. No.
Country
Million Tons
1
Iran
13.80
2
Turkey
13.30
16.00
14.00
12.00
3
China
11.50
4
Thailand
11.47
8.00
5
Japan
11.40
6.00
6
South Korea
10.05
4.00
7
UAE
9.00
8
Pakistan
8.37
9
Germany
8.25
10
Vietnam
7.70
10.00
2.00
-
Source:
Global Cement Report 10th Edition

22. Thanks
Muhammad Asadullah
Manager Export Marketing
Lucky Cement Limited
6-A, Mohammad Ali Society
A. Aziz Hashim Tabba Street
Karachi - 75350, Pakistan
Tel: +92 21 111 786 555 Ext: 336
Cell: +92 321 2490859
Email: asadullah@lucky-cement.com
Website: www.lucky-cement.com