Gypsum industry news

China: Grenzebach BSH, a leading global supplier of process and production technologies, has received a ‘significant’ order from XINFA Group for the supply of two gypsum wallboard lines to XINFA’s existing production plant at its headquarters in Chiping-Liaocheng, Shandong Province. XINFA, one of the world’s leading aluminium manufacturers, will expand its gypsum wallboard production capacity to approximately 830,000m²/day (273Mm²/yr). This will make its plant the world’s largest, and is the second time that XINFA has relied on Grenzebach’s expertise.

XINFA Group runs its own coal-fired power plants to cover the high electricity requirements of its aluminium plants. Flue gas desulphurisation (FGD) gypsum is produced during the purification of the exhaust gases. Using Grenzebach equipment, XINFA has been able to recycle this gypsum to produce gypsum wallboard since 2021.

Robert Brier, CEO of Grenzebach BSH, said “The project demonstrates how close we are to our customers and our competitiveness, as well as our innovative strength in supplying manufacturing plants with a focus on sustainability aspects. By recycling the FGD gypsum, we are supporting our customer’s circular economy, while at the same time using the electricity generated and the waste heat from the power plants to operate the gypsum dryers and systems.”

Germany: Grenzebach has expanded its portfolio by acquiring the technology to build its own special hammer mill, previously sourced from Beumer Group subsidiary FAM Minerals & Mining. The hammer mill processes particle sizes of 0 – 50mm, with a throughput of up to 50t/hr. The acquisition also covers technology for the dynamic classifier. Grenzebach says that it will continue to further develop its portfolio of calcination line components, focused on energy efficiency, carbon reduction and digitisation.

CEO Robert Brier said “We are constantly looking for ways to optimise our customer orientation. That is why we were very interested in expanding our portfolio and ultimately acquired the technology.”

Grenzebach said earlier this month that it is going to invest around Euro2m on growing its presence in Pune. The current sales and service branch will be merged with a new production site in the city in Maharashtra. The site will be used for the assembly of conveyor equipment and welding work for dryers and lehr ovens for the glass industry. Production at the new unit is expected to start in October 2023 and it will create around 30 new jobs.

The decision by the Germany-based equipment supplier to expand in India follows Saint-Gobain’s expansion plans in India. It said in late 2022 that it was planning to spend US$215m towards capacity expansion plans in 2023 as part of a larger investment in the region, of US$970m between 2022 and 2025. Its stated aim for the new investment is to grow its revenue to US$4.4bn in 2032 from US$1.5bn in 2022. To break this down, half of the group’s turnover in India comes at present from glass-related businesses, 30% from gypsum and construction chemicals and the rest from abrasives, ceramics and life sciences. Some examples of this planned investment include the acquisition by Saint-Gobain of Rockwool India, a stone wool manufacturer, in February 2023 and an agreement to buy UP Twiga Fiberglass, a glass wool producer. Saint-Gobain is the biggest gypsum wallboard producer by capacity in India with four plants, followed by USGKnauf, which runs two plants, and various independent producers.

Growing the wallboard market in India has long seemed like an enticing prospect given the country’s demographics, low production capacity per capita compared to Europe and North America, and sustainability trends. However, despite all of this, it is taking a long time to get there. One commentator on LinkedIn has suggested that this may be down to reticence from the construction sector to adopt the product. In his view wallboard in India has mainly been used for ceilings and for commercial and industrial applications but not for residential projects. Producers, such as Saint-Gobain are likely to be well aware of this. So it is interesting to note that two projects in India picked up awards in Saint-Gobain’s International Gypsum Trophy in 2023.

On the crude gypsum side, data from the Indian Bureau of Mines and the United States Geological Survey (USGS) show that India produced an estimated 4.3Mt of gypsum from its mines from reserves of 37Mt. These reserves are far smaller than other countries with large populations such as China, the US, Brazil or Türkiye. The country also produced an estimated 2.1Mt of flue gas desulfurisation (FGD) gypsum in the 2023 – 2023 financial year. However, the Cement Manufacturers Association (CMA) estimates that its sector used 13 – 17Mt in 2020 – 2021 when cement production was 331Mt and that this is forecast to rise to 20 – 25Mt in 2024 – 2025 when cement production reaches 491Mt. This corresponds to the 4 – 5% of gypsum that it is added to clinker when grinding it to manufacture ordinary Portland cement (OPC) and other cement types.

In acknowledgment of this gap between mining and usage, the Department for Promotion of Industry and Internal Trade (DPIIT) started promoting recycling gypsum from fertiliser production and power plants in May 2023. So far, its main focus has been on improving access to phosphogypsum stockpiles, although the target for FGD production is an ambitious 9.9Mt by 2025 – 2026. Unsurprisingly, gypsum exporters have benefitted from this situation. Oman, reportedly, exported nearly 5Mt of gypsum to India in 2022. Historically, Thailand and Iran have also supplied the Indian market with gypsum.

India remains the great maybe for wallboard adoption outside of North America and Europe. The latest round of investment by Saint-Gobain and Grenzebach may yet deliver on this. Both companies are looking at a range of light materials including glass and insulation not just wallboard. So far though, the main merger and acquisition activity by Saint-Gobain has been targeted on insulation companies. Once or if Saint-Gobain or anyone else starts buying gypsum companies or building new plants then we will have a sense that something is changing. Alongside this, the DPIIT’s plans to recycle more gypsum may help bring further attention to the local gypsum sector.

Two news stories to note over the last two months indicate growth in the gypsum wallboard market in Romania. Firstly, Knauf announced plans in mid-October 2022 to build a new 30Mm²/yr gypsum wallboard plant at Huedin in Cluj County. Then, Germany-based Grenzebach’s local subsidiary revealed that it had broken ground on the construction of an upgrade to its Iasi production centre.

Knauf’s announcement follows work by the existing wallboard producers with plants in the country to increase their own local capacity. Saint-Gobain started building a new production line at its Turda plant in mid-2021 at a cost of Euro45m. It hopes to have the project completed by April 2023. Etex started work in mid-2022 on a Euro6m sludge drying unit at a coal-fired power plant in Oltenia that will supply synthetic gypsum for use at its Turceni plant. It is also working on logistics upgrades to Turceni and a separate plaster plant at Aghiresu.

Graph 1: Growth rate of the construction market in relation to market volume in selected emerging countries, 2020 – 2030. Source: Saint-Gobain financial report using data from IHS.

An indication of Saint-Gobain’s interest in the Romanian market can be seen in its universal registration document for 2021 where it outlined its strategy. It presented a graph of forecast growth rates in construction markets in selected developing markets between 2020 and 2030. The countries that are underlined in Graph 1 (above) are those where Saint-Gobain made large acquisitions or investments in 2021. Romania is interesting on this graph because it is the European country with the largest predicted growth rate. It also has a relatively low market volume suggesting potential for market growth, although note that the graph only shows selected countries.

Another reason why Knauf might be interested in Romania is that it is the largest country in the European Union in which the company does not have a wallboard plant. Knauf’s own take from its press release about why it decided to build a plant in Romania was that local per capita consumption of gypsum wallboard was around 3m²/yr compared to at least 6m²/yr in more mature markets elsewhere in Europe.

Etex’s subsidiary Siniat Romania reported a 20% year-on-year rise in turnover to Euro60m in 2021. This compares to a 24% rise in turnover to Euro307m by Saint-Gobain Romania. Andrei Popa, Etex’s Country Sales Manager Romania & SEE, told Agenda Constructiilor that Siniat Romania’s turnover grew by 25% year-on-year in the first eight months of 2022. However, it is unclear what difference Etex Group’s acquisition of insulation producer URSA in June 2022 made to the figures in Romania. Popa also revealed that the rise in turnover so far in 2022 was mainly down to price rises. This in turn had been promoted by mounting energy costs, particularly gas. The company described itself as a ‘big consumer of gas’ and reported that the price had risen seven times over the past year. One more point of interest to mention is that Popa described Etex as one of the largest exporters in the country, with 40% of local production sent over national borders. This also aligns with what Knauf said about its new plant. It intends to deliver half of the production from its proposed plant at Huedin to Hungary, Serbia and the Republic of Moldova. The other half will serve the domestic market in the north of Romania with imports from Bulgaria expected to continue to supply the south of the country.

The data above suggests why Saint-Gobain, Etex and Knauf have all invested in wallboard production units in Romania over the last two years. The local market has growth potential and the companies are also focused on exports to neighbouring countries. All this investment may also have contributed to Grenzebach’s decision to enlarge its production site at Iasi too. The ‘fly in the ointment’ here in the short term is the disruption to energy markets caused by the war in Ukraine. Siniat Romania mentioned its concern over gas prices above. Saint-Gobain also made similar comments on a general basis for Europe in its nine month financial results in late October 2022. It said that it was preparing continuity plans for its gas-consuming plants in Europe but added that its gypsum wallboard production lines were ‘extremely flexible.’ However, Romania is better prepared for problems with gas supplies compared to elsewhere in Europe because it produces around 90% of its requirements locally. Despite energy concerns at the moment, the long term potential for the wallboard market in Romania remains promising.

Romania: Grenzebach Romania has broken ground on its construction of its upcoming Iasi production centre. The equipment supplier plans for the centre to serve as a hub for its European building materials, glass and intralogistics activities. Grenzebach chief executive officer Steven Althaus said that the group is expanding to meet growing European demand in the sectors in which it operates, while also creating 100 new jobs for Romanians.

Cuba: Rose Gypsum has thanked Grenzebach and GPM Engineering for the company's help in negotiations with Empressa Materiales de Construccion. The companies have been in talks with the state-owned company to build a gypsum wallboard plant for Cuban and the Caribbean market. The plans also include production facilities for ceiling panels. Rose Gypsum described the tendering process as 'extremely challenging.' It is currently waiting for a response to its latest proposal.

India: Grenzebach BSH has signed a deal with Classic Gypsum of Kolhapur, Maharashtra to supply a plaster and plasterboard plant. No value for the contract has been announced. The deal was formalised at the 16^th Global Gypsum Conference that took place in Bangkok, Thailand. 

Abkhazia/Saudi Arabia: Grenzebach BSH GmbH has ordered two Gebr. Pfeiffer vertical roller mills, one MPS 140 GC and one MPS 180 GC, for gypsum grinding-calcining for its new works in the breakaway Georgian region of Abkhazia and in Saudi Arabia.

The two vertical roller mills are designed to attain throughput rates of 16t/hr and 35t/hr, respectively. They are slated for delivery in the first and second quarters of 2014.