ANALYSIS OF YANBU CEMENT COMPANY AND IS PRODUCT
Name
Institution
History of YANBU Cement Company
YANBU Cement Company is a joint stock Saudi company formed in the year 1977. It produces different kinds of cement such as the Portland cement and the Portland Pozzolan Cement. The company owns about 60% of Yanbu Saudi Kuwait for Paper Products Co. Limited. The company currently has a capacity of 22,500 tpd per day. The company sells most of its products in Makka and Madina and other Western regions of the Kingdom of Saudi Arabia. The company operates in the rapidly growing Saudi cement industry. Saudi Arabia is the third largest producer of cement after Iran and Egypt.
Product, features and history
Cement is a finely ground compound of limestone and clay or marl (Chandigarh, 2001). It is used in hydraulic binding since it hardens and binds together aggregates and becomes waterproof thereafter. The most popular use of sand is in building and construction where it is used to bind sand and gravel to obtain concrete used in constructing houses, roads, water channels, among others. Yanbu Cement company produces different types of cement such as Portland cement types I, II, III and IV.
Effects of changing prices and other factors
Changing prices
Yanbu operates in a highly competitive industry with several well-established cement manufacturers. Its main competitors include Saudi Cement, Yanama Cement, Arabian Cement, Qassim Cement, Al Safwa cement, among other cement companies. By the year 2010, Yanbu had the second largest cement production capacity after Saudi Cement. The price charged for each bag of cement is a major determinant of demand for a company’s cement in the market. According to the law of demand, m...
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... has contributed to higher volumes of production. Saudi Arabia is endowed with large deposits of limestone making it a suitable location for cement manufacturing. Proximity to the source of raw materials also reduces the transport cost.
Finally, government policy influences the supply of cement. A price ceiling on cement leads to a reduction in cement supplied in the domestic market and an increase in the quantity exported. An export ban restricts cement manufacturers to supply their products to the domestic market. In addition, government control is effected through issuance of licenses to cement manufacturers. The cement industry had been dominated by eight companies but this has changed with the issuance of licenses to additional seven companies. An increase in the number of firms licensed to manufacture cement leads to an increase in the supply of cement.
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In order to reduce the problems, the company should open a new branch in the GCC. In addition, problems are not the only reason to expand. The population of the kingdom was estimated to be 29,369,428 in 2014 - the 43rd largest in the world (Worldpopulationreview.com, 2014). On the technology side, Saudi Arabia is becoming focused on technology.
In the next decades the cement consumption is expected to grow by 4.4% per year for developing countries and 0.9 for developed countries. This way I believe that one of the best strategy for CEMEX to continue its growth as a leader in cement industry is to invest and open plants and distribution centers in some of developing markets in Eastern Europe and Africa, where the demand for cement is expected to increase dramatically by 85% to 2020. The pros about this alternative is that the company could expend their markets and will increase their profit but at the same time the investment will be bigger and the return could be in a long term.
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Almost no other material manages to carry such contradictory associations. Stigmatized on one hand, celebrated on the other, it evokes highly diverse reactions this material is cement. Cement is a finely ground powder binder, a substance that sets and hardens and can bind other materials together, when mixed with water forms a hardening paste of calcium silicate hydrates and calcium aluminates hydrates. Cement is used in mortar and concrete (bulk rock-like building material made from aggregate, sand, and water). By modifying the raw material mix and the temperatures utilized in manufacturing, compositional variations can be achieved to produce cements with different properties. Cement, chemically speaking, is a product including lime as the
Concrete today is considered by many modern engineers and architects as a more efficient and effective alternative to steel n regards to the creation of buildings, ranging from low-story apartments to neck-breaking skyscrapers. Through the rapid growth and development of the world's major metropolises and growing cities, concrete today has become one of the most important building materials to date. According to the World Business Counsel for Sustainable Development (WBCSD), “it has become the most consumed substance on earth, only superseded by water, with three tons for each person used annually” (World). This huge demand for concrete makes the cement industry one of the world's largest carbon dioxide producers, accounting for about five percent of all man-made pollution. “Approximately one ton of carbon dioxide is put into the atmosphere for every ton of cement used” (World). The cause for this problem is the increase of the global population and the increasing demand for land and energy. It's effect is that as the population continues to increase, it forces builders and developers to meet the quota of creating unlimited amounts of infrastructure within a limited resource-filled world. Knowing this, a proposed and widely agreed solution is to make the concrete in an environmentally-conscious way that will incorporate more demolished concrete, scrap from past projects, and other recycled aggregates.
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Water : Water is an important ingredient of concrete as it actually participates in the chemical reaction with cement. Since it helps to from the strength giving cement gel, the quantity and quality of water are required to be looked into very carefully.
Constituent materials are the fundamental materials required to produce concrete. The constituent materials of concrete consist of mainly three materials which are cement, aggregate and water, with admixtures included as addictive to alter the characteristics of the concrete (Scalenghe et al., 2011). “Cement is the chemically active constituent but its reactivity is only brought into effect on mixing with water” (Dhir & Yap, 1984). According to Bye (1999), in the industry, Portland cement, which was developed in 1824 by using calcium carbonate found in calcareous rocks, namely limestone or chalk and silica, alumina, and iron oxide found in sedimentary rock, namely clay or shale. Bye (1999) said that cement is produced by grinding the quarried limestone to powder form, blending it with water and heat with pulverized coal to drive out water at 100°C, carbon dioxide at 800°C and clinker at 1400°C, which is then cooled, grounded and mixed with 1%-5% gypsum to alter it fineness and goes through final grinding and the cement is ready to be distributed to the market. According to Sismondo & Sergio (2009), aggregate, which builds up the majority of the volume stability and the durability of the resulting concrete and is of lower price than cement, is always used to the maximum extend as possible in the production of concrete for maximum profit. Aggregates ar...