I find it remarkable that cement is exported at all

Below are the 15 countries that exported the highest dollar value worth of cement during 2016:

  1. China: US$692.4 million (7.6% of total cement exports)
  2. Thailand: $612.2 million (6.8%)
  3. United Arab Emirates: $544.4 million (6%)
  4. Turkey: $494.8 million (5.5%)
  5. Germany: $486.3 million (5.4%)
  6. Spain: $477.3 million (5.3%)
  7. Vietnam: $403 million (4.4%)
  8. Japan: $391.3 million (4.3%)
  9. Canada: $368.7 million (4.1%)
  10. India: $267 million (2.9%)
  11. Greece: $248.6 million (2.7%)
  12. Senegal: $209 million (2.3%)
  13. United States: $205.9 million (2.3%)
  14. Pakistan: $185.6 million (2%)
  15. South Korea: $162.9 million (1.8%)

Here is the link.


Exports could be to countries very close by.

I'll bet Pakistan's goes to the gulf states.

It is economical to import cement by sea, but you really need to use it no further than 50 miles from the port it goes into. This usually works out because the major ports also overlap with major coastal cities that use a lot of cement for concrete production.

The way the math works here is that concrete is mostly sand/aggregates, with a little bit of cement, BY MASS. However cement is something like 10x as expensive as sand/aggregates per ton, so concrete winds up being closer to half-and-half on a dollar-weighted basis. This means that cement actually does make sense to export, unlike aggregates which are a really low value-to-weight product and which you generally don't want to have to move it more than a couple hundred miles except in some unusual geological situation.

Thanks rock lob. Nothing remarkable at all about cement being internationally traded. Components are mined, efficient plants are big capital investments.

Ignore my typo plz.

Also not sure if I'm being 100% clear here. My point is just that if you're thinking just in terms of concrete, that glosses over the fact that cement is the expensive secret sauce in the concrete and is a much higher value-to-weight product than just the aggregates. To use real numbers cement is ~$110 per ton these days, whereas major U.S. aggregates producers are getting something in the $13 area per ton for aggregates. So the economics work much better for cement. That actually compares pretty well to something like export coking coal which is in the $100-200 area per ton and gets shipped all over the place, just to use an example I happen to be familiar with off the top of my head.

That makes perfect sense. Also, sea shipping is good for heavy stuff.

That is quite an equal distribution. I'm surprised England is not on it, a place where doofuses in tats you'd think work the streets. For me, the psychology does not change to much and is elementary logic. And then to yield. And understand Dorset is in Vermont as well as Portland and also England and to understand the chicken and the egg.

Why would England be on it? It isn't a country. Are you surprised not to see Dagestan and Mato Grosso as well?


How much cement do you think they could produce on the US Virgin Islands?

My guess is Milton Friedman would give a number of reason why Congress should promote rebuilding on the US Virgin Islands using funds authorized by Congress to buy imported cement from China.

Starting with China taxpayers subsidizing cement exports. Plus paying Americans to transport cargo costs US taxpayers too much. America taxpayers are better off paying Asians to do as much US infrastructure work as possible.

However, it is not remarkable that a GMU econ dept professor is seemingly unaware that cement is a broad term, encompassing a wide variety of specialty products - https://en.wikipedia.org/wiki/Cement#Modern_cements

Which is why comparing the total weight exported with the dollar value would be the sort of thing that one would never expect to find here. For example, it seems as if Vietnam exported 15 million tons of cement in 2016 at around $26 per ton. China's comparable figures seem to be 8 million tons at $87.5 while Germany's are 6.5 million tons at $80 per ton (and Germany is a net cement importer, by the way - https://www.vdz-online.de/en/latest-news/press-releases-detail/news/32-per-cent-increase-in-cement-consumption-in-2016/cobj/20680/ )

This list would look considerably different if ranked by weight, as Vietnam's exports alone are larger than China's and Germany's combined.

Note that cement is not the same thing as concrete. It's only one ingredient in concrete, e.g. this article recommends a 1:2:3 ratio of cement:sand:gravel, then add water.

So while shipping concrete would get prohibitively expensive, shipping cement would be much less costly and given varying resource endowments and comparative advantage, I can easily imagine a country wanting to import cement just as it imports lumber, iron or steel, etc.

And I believe it was only a couple of months ago that Tyler linked to an article about the increasing scarcity of sand on world markets. I.e. some countries even import sand.

Gravel and water presumably are usually sourced locally, but one could imagine some South Sea atoll might not have any gravel and might have to import even that. Probably a very small market though.

That first sentence is such a polite way to suggest that in fact Prof. Cowen may not actually know the difference between cement and concrete.

Yep. Also, not everyone has limestone which goes into making cement, and some countries have cheap energy sources next to limestone. And, don't forget about backhaul opportunities for another commodity you import.

The Chinese steal sand from offshore in the Philippines, using barges, and export it to Chinese beaches. White sand is favored. Water transport is cheap and due to the Archimedes effect (recall water is heavy, weighing about 1 kg per liter) you don't have to worry, like in air transport, keeping something aloft, just pushing it horizontally. One reason I'm a buyer of Walmart and Macy's despite the hype about 'drone delivery'. Except for light-weight stuff it will not impact traditional retailing. Bet on it.

I see some other commenters made similar points but this refers to exports of dry cement and many of these exporters share borders with countries that are smaller and/or poorer than they are. For instance, the capital city of Laos sits right on the border with Thailand so it is fairly easy to imagine that a lot of the cement that gets used there arrives by truck from Thailand (one of the biggest industrial companies in the country is incidentally called Siam Cement Group). Laos may not be a large or developed enough country to attain the same sorts of economies of scale as Thailand.

This was my thought. Local markets can also be "export" markets.

Cement is indeed traded in a manner that concrete is not. In fact, most advanced countries (I did some work on this 30 years ago) have a network of concrete plants all over the country. It's pretty easy stuff to make if you've got sand, gravel, water and cement. So, every 20 to 30 miles or so, and different companies will have different networks of them, you have little plants able to mix into the required proportions for that particular use.

If you need some - anything from the foundations of a suburban basement on up although really big operations will have their own mixing plant - you call up the local supplier and get them to send a truck around. You know, those "cement" trucks, with the big barrel on the back gently spinning as they trundle along. Given the transport costs of something so bulky, the low capital costs of a mixing plant plus the low lifespan between mixing and setting, this dispersed production of concrete makes sense. But the capital costs of cement production (possibly up at a $ billion or so) argue for centralised production of the cement itself.

Until 15 years ago, when I was working often as a consultant in the business, but I do not think it changed much, the economics were as follow, per ton:
Fixed costs (mostly cost of capital of the plant, about 200$ per ton per year) 20$. Variable costs (mostly fuel for the kiln and electricity for the mills) 20$. Transport by sea, specialized ships, pneumatic charge and discharge: 15-25$, depending on dinstance and size of the shipment. Road costs: 0.5$ per ton per mile. Note: by sea, clinker (the intermediate product after the kiln but before the mill) travels very well, while cement is dangerous because of the water, although possible.
The price has nothing to do with costs, it moves from 25-30$ (countries in recession with overcapacity and desperate price wars) to 200$ (where the cartels work well. BTW, ever wondered why American companies do not compete in basic commodities like cement or glass? Anti-trust laws). The trade departments of the big guys (Holcin, Lafarge, CEMEX, Heidelberg...) took care of excess production (hot cement, in jargon) of countries in recession, buying it and moving it to less important, poor countries. Then two things happened:
1) China installed the equivalent of 50% of worldwide capacity in a few years. Today, China has a capacity of 1000 kg per person per year, the countries with the higher consumption per capita, Italy and Spain, had a consumption of 800kg. The former big guys were now midgets. 2) technology created huge economies of scale in fuel and investment in the kiln. Kilns up to 5-6M tons per year started to appear, even when the local demand was much lower, but mills (max 200k tons per year) were added slowly, along the increase in demand. This created a mismatch of capacity of clinker and cement, and a huge availability of clinker. Smaller entrepreneur started to buy small mills, putting them close to a port and with a 15-20M$ they were in business. Finally, a few years ago water-resistant 2-5 tons "big bags" were introduced, containing the usual 50 kg bags, that could move in general merchandise cargo ships. Suddenly, with a couple of millions for a warehouse and a few old trucks you were in business. Just buy in Alibaba FOB shangai at 30$, add 30-40$ of transport, and sell at 100$ in a country were the price is 120$. Preferably in poor countries, where cement is sold in bags, rather to ready-mixers that are usually owned by the cement producers.

That was certainly informative.

Wow thanks Massimo. That's quite good. I invested in Cemex a while ago, a big leader in Mexico, and I've noticed historically Greece exports a lot of cement (the entire country is cement crazy, using big industrial cranes and hoses imported from Germany to pour it continuously, not buckets, and using much more concrete than in the Philippines, where they don't pour concrete walls but use concrete cinder blocks and slender columns filled with hollow block). As for shipping cement, like a poster upstream says, if they ship sand, it can be done economically, and they also economically ship iron ore and coal from Australia to China, so bulk transport by water is cheap (you only have to worry about water friction, not weight, due to the Archimedes effect).

Bonus trivia: Pozzolan is a naturally occurring cement, from volcanic soils in Italy. The Romans perfected using it. You might then wonder why, if it's found in nature, it does not harden and become useless? Ah, there's the rub (trade secret!). It turns out it does harden, but only on the outside, which forms a shell, and if you break the shell and finely divide the pozzolan, and add other ingredients, the pozzolan turns to concrete. Simple in theory, but in practice how to do this is tricky, so much so that the art of making concrete was lost when the Roman empire fell, and only rediscovered in the medieval ages. One more reason to push for...patents. Yes better patents will cure all ills. Remember I said that long after I get bored reading this site and fade away. One word: patents.

Double bonus trivia: CEMEX was awarded Lone Star Land Steward recognition for conserving a 10,000-acre ranch on the Texas side of the river.

I worked a lot with Cemex in the '80s, when Lorenzo Zambrano was the CEO, Caballero the CFO, Domene the guy charged with international development and Garcia in research and plants construction. Maybe the finest management team I ever met in 10 years of consulting, in any industry or country. Extremely aggressive, close to illegal, but never crossing the line. Totally big alpha-man macho culture, notwithstanding the sexual preferences of some of them. They are mostly dead now. Since Lorenzo died 3-4 years ago, the company is in the hands of out-of-their-depth empty suits. If I were you, I would sell.

Greece built a lot of capacity for the '92 Olympics, and never really recovered. Greece and Turkey were the traditional sources of hot cement until at least the end of the century.

Pozzolan is simply volcanic ash, it is very similar to ash from blast-furnaces. It works very well in water rich environment, for example is very common in Holland. But, as it is common to say in the industry, cement is cement is cement, it is all basically the same chit, it is the ultimate commodity. The only real difference with traditional Portland is white cement, which is a very small niche with special applications.

Thanks for that tip...I got out of Cemex years ago with a small profit. I wonder why Pozzolan is considered 'environmentally friendly' if it's just blast-furnace ash? It's blast-furnace ash a waste product, so using it is environmentally friendly? Unless pozzolan is found in nature and does not need energy to produce?

By definition, cinder blocks are not made from concrete. They are made from a brick composition with about 50% volume replaced by sawdust, which gets burned out during the firing. They were invented sometime around 1870 by a midwest brickmaker. An architect from New York was visiting and noticed the brickmaker had a peculiar porous brick he was soaking in kerosene and setting on fire to heat up his coffeepot. The architect asked about this brick and was told it was an experiment. The architect recognized right away this was the lightweight brick he needed to make high-rise buildings. And by the way, they are not called cinder blocks in the business. They are called structural tile.

I'd always wondered what the deal with cinder blocks was, but was too lazy to look it up.

I wonder if that brick stove trick could be used by backpackers who are hiking in Hawaii or other volcanic areas. Instead of carrying a backpacking stove, just pour some fuel onto/into a porous rock, and ignite. Probably would work better with kerosene than with backpackers' usual liquid fuel, white gas, which can be highly vaporous and explosive.

The economic manufacture of cement depends on the local geology. Trade between areas with different geologies is therefore inevitable. There is little more worth saying.

There's a lot more worth saying. Dearieme don't talk like one of those 'world history' teachers who give a very bland, details free description of world history, comparing the detailed rich West with the rest. (E.g., "humankind progressed all around the world between the years 1000 CE to 2000 CE" , lol these teachers never use centuries, since their dumbed down audience would not understand 5th century means 400 AD to 500 AD).

Don't be such a fool. There's all the difference in the world between pointing to the key physical effect - geology - and empty posturing about progress.

The US is the second leading producer of phosphate, which is used to make fertilizer. Florida has the largest deposits of phosphate in the US. The US (Florida) was the leading exporter of phosphate up until 2006 (when China surpassed the US). The ingredients in cement include limestone, chalk, shells, or similar materials. Florida also has large deposits of limestone and is a leading producer and exporter of cement. Like phosphate, limestone is in the soil. Florida is a leader in the thoroughbred industry because of the limestone in the soil: the horses eat the grass which includes a high content of limestone. Limestone is also used as the base for building roads, which helps explain why Florida seems to want to pave the entire state.

Phosphate is mostly mined in central Florida and shipped from the ports in Tampa, which helps explain why the water in Tampa Bay seems to glow at night from the reflection of a full moon. Phosphate rock is naturally radioactive. I wouldn't build or buy a house on reclaimed phosphate land, but to each his own. An artificial island just off downtown Tampa was used to store phosphate to be shipped. The island has been reclaimed and now has lots of high-priced homes on it, purchased and occupied by people who have no idea of the history of the place. One day they or their children may glow in the dark!

Nice. It's the NORM for junk land to be sold to noobs. Naturally Occurring Radioactive Material.

Tyler is missing the bigger story: China is now the leading exporter of sidewalks at 22%.

Thirty years from now, a future British prime minister will be writing a book called Why America Slept. By then, it will be too late, though.

For the analogy to hold you'd need to say "Thirty years from now, a future British prime minister's ghost writer will be writing a book called Why America Slept".

China exports cement mostly to Bangladesh, Kenya, USA, Philippine, Australia etc in recent years. Comparing to China, the price of cement is about five times higher in Africa, two times higher in Australia, and doubles in USA, Philippine, and some other Southeast countries. As the price incentive is more than covering the transportation cost, it is still very profitable to export cement. At least that's the case for China.

Perhaps a better question would be, why don't the countries at the other end make their own? There are several thoughtful attempts at this already, so I won't bother adding anything to them except this: cement likely requires a large, dirty, smelly, and loud place to make it. This would logically make it an undesirable product for many first-world countries. Also, based on the figures that have been quoted, it is a low-return product.

But it is a robust, proven, reliable product, used in a lot of different ways, for which there is a strong and relatively constant demand (yes, of course the demand is cyclical, but my guess is that much of that aspect is arbitraged by globalization). So cement is a lot like steel. But you never hear anyone ask why countries export steel.

Cement production is extremely intensive in CO2 emissions, both because of the amount of fossil fuel used for limestone pyroprocessing, and because the reaction that produces the clinker releases CO2 directly from the Calcium Carbonate itself. Having lots of cheap, local coal and a more lenient domestic regulatory environment produces large competitive advantages in the sector.

Cement industry is all about offloading environmental costs and getting rid of safety regylations : basic colonialism in new clothes

Note - they are exporting cement, not exporting concrete. Concrete is too heavy to transport more than a couple hundred miles. Cement is one component of concrete (about 1/6th of the non-water ingredients). Mix the solid ingredients and add water locally.

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