Gypsum industry news

Germany/Ukraine: The Würzburg Prosecutor's Office has opened a preliminary investigation into Knauf over its alleged involvement in the on-going reconstruction of Russian-occupied Mariupol. The investigation will seek to establish whether an ‘initial suspicion’ of criminal activity exists. Germany-based media outlet ARD published its allegation of Knauf’s involvement in the reconstruction via the use of its materials earlier in April 2024. The Würzburg Prosecutor's Office added that "There is currently no initial suspicion against Knauf employees."

The producer denied the allegations, adding that it complies with relevant laws and sanctions.

Brazil: The Administrative Court of the Brazilian Administrative Council of Economic Defence (CADE) has submitted for review the proposed acquisition by Knauf Brazil of a gypsum wallboard plant operated by Trevo Industrial de Acartonados. The Office of the Superintendent General (SG) noted after an investigation that the transaction would increase market concentration, exceeding the limits set out in the guides of CADE and the competition law. The gypsum wallboard market in Brazil has four suppliers, including Knauf and Trevo.

The review pointed out that imports are “unusual and cannot be considered a source of competition if Knauf raises the prices after merging with Trevo.” The SG also warned that other factors could lead to potential market collusion such the lack of history of competitive rivalry in terms of price, quality, or any other difference amongst the products.

Following its challenge to the proposed acquisition, the SG has submitted the case to a tribunal. At this stage a commissioner will review it and include it in the agenda for further adjudication.

India: The Directorate General of Trade Remedies (DGTR) has recommended a five-year anti-dumping duty on gypsum tiles imported from China and Oman. Saint-Gobain India initiated the investigation that started in late 2022. It considered gypsum tiles laminated on one side with polyvinyl chloride (PVC) or wax paper that are typically used in ceilings. The study concluded that the product had been “exported to India at a price below the normal value, resulting in dumping.”

Croatia: The Croatian Competition Commission (CCA) has started investigating Knauf for alleged market distorting behaviour from 2017 to 2021. In a statement the regulator said that the wallboard producer, has been accused of abusing, “…its dominant position by applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage. Concretely, the complainant claimed that Knauf applied different rebate schemes (discounts) and trading conditions that were not based on objectively justified criteria, which have directly resulted in distortion of competition in the preliminary defined relevant market in drywall gypsum boards.” The CCA will examine whether Knauf’s behaviour breached Articles 8 and 13 of the Croatian Competition Act.

Germany-based Knauf operates one gypsum wallboard plant in the country at Knin.

Switzerland/UK: Sika says it plans to complete its planned acquisition of MBCC Group in the first half of 2023 following the decision by the UK Competition and Markets Authority (CMA) to further investigate the merger. Previously the construction chemicals company intended to close the transaction by the end of 2022. Sika signed a deal to buy MBCC Group, formerly BASF Construction Chemicals, in November 2021.

Thomas Hasler, the chief executive officer of Sika, said "Sika has already received unconditional regulatory approval across a number of jurisdictions, including Japan, China, Brazil, South Africa, Saudi Arabia, Turkey and Thailand. For a transaction of this magnitude a detailed analysis is not unusual. The adapted timeline for the closing does not impact the strategic attractiveness of the transaction. It remains highly accretive, and our expectation that it will generate annual synergies of Euro160m - 185m is unchanged."

UK: The Competition and Markets Authority (CMA) has formally launched the first phase of a merger inquiry into the proposed acquisition by Saint-Gobain of GCP Applied Technologies. The competition body said that proposed merger had met the threshold for investigation under UK law. The CMA will now decide whether to refer the merger for further scrutiny by 21 September 2022.

Saint-Gobain said it had agreed to buy construction chemicals producer GCP Applied Technologies for Euro2bn in late 2021 with a conclusion date to the transaction by the end of 2022.

UK: The Competition and Markets Authority (CMA) is considering whether the proposed acquisition by Saint-Gobain of GCP Applied Technologies could result in the creation of a relevant merger situation or lessen market competition generally. It has asked any interested party to comment on the transaction by mid-June 2022.

Saint-Gobain said it had agreed to buy construction chemicals producer GCP Applied Technologies for Euro2bn in late 2021 with a conclusion date to the transaction by the end of 2022.

New Zealand: The New Zealand Ministry of Finance plans to launch a commission to investigate high building materials prices. The New Zealand Herald newspaper has reported that finance minister Grant Robertson said that New Zealanders pay too much for building materials. Robertson indicated that any probe would look into gypsum wallboard among other building materials. Average national building materials prices are 20 – 30% higher in New Zealand than in Australia.

Canada: The Canada Border Services Agency has started an investigation into gypsum board products being imported from the US. The probe has been initiated by a complaint by CertainTeed Gypsum Canada about the products being imported into British Colombia, Alberta, Saskatchewan and Manitoba, as well as the Yukon and Northwest Territories, according to the Canadian Press newspaper. It is the second complaint that CertainTeed Gypsum Canada has made in recent years, following a similar allegation in 2016.

In 2016 preliminary tariffs were imposed on US imports and then reduced after being blamed for raising the price of wallboard. The increases were linked to higher costs for domestic customers in Fort McMurray, Alberta following destruction caused by wildfires. The Canadian International Trade Tribunal later ruled that US imports had caused injury to local producers but that maintaining duties would not be in the country's trade interests.

India: The Central Bureau of Investigation (CBI) has started investigating officials at Fertilizers and Chemicals Travancore Limited (FACT) for corruption related to the sale of gypsum. The CBI is exploring whether a cartel was formed between FACT and Nagarjuna Chemicals to sell fertiliser-derived gypsum to NSS Trade India Private Limited at a significantly lower rate than the market value, according to the Times of India. In addition a clause in an agreement between the companies suggest that they may have intended to keep the price of gypsum artificially high to the end clients.