CEMEX announced during CEMEX DAY - its annual investors and analyst day - on Wednesday, 16 November 2022, that it expects a promising medium-term outlook for its markets, bolstered by fiscal stimulus packages in the US and Europe related to infrastructure and green spending as countries continue investing in transitioning to a lower-carbon economy.
In addition, the company expects significant demand in the Industrial & Commercial sector with onshoring and the redefinition of trade relationships due to supply chain constraints and geopolitical tensions. Mexico, Europe, and the US are well-positioned to take advantage of the reshoring trends. The company also announced aggressive new 2030 decarbonisation goals, spurred by record-breaking CO2 reductions in the past two years.
“In the past three years, our business has proven its immense resilience in the face of a global pandemic, historic inflation, and supply chain disruptions,” said CEMEX CEO Fernando A. González.
He continued: “I am incredibly proud of how we have navigated the extraordinary developments of the last few years. With the highest inflation in 40 years, we have been successful in recovering costs in dollar terms. In 2023, however, we must develop our pipeline of growth projects while we continue our efforts to recover margins, as some cost headwinds, particularly in Europe, are still ahead of us. Our growth, climate action, and digital strategies, coupled with our Urbanisation Solutions business, will provide a strong base for growth over the medium term.”
CEMEX has weathered inflation with a bold pricing initiative that has more than offset inflationary costs in dollar terms. Still, high inflation and supply chain headwinds have delayed its ability to regain margins. In the US, the Infrastructure Investment and Jobs Act includes US$110 billion of incremental spending for highways and streets, the most cement-intensive portion of infrastructure.
Meanwhile, In Europe, the €750 billion from the Recovery Fund to invest in green technologies, clean energy and transportation, renovating buildings, and upgrading digital infrastructure, is also expected to be an important driver for building materials. In Mexico, the onshoring phenomenon is expected to drive demand for manufacturing and industrial construction in the medium term.
CEMEX also announced on CEMEX Day the goals of its new 2030 roadmap. The aggressive 2030 goals include a 47% reduction in CO2 per ton of cementitious material and a commitment to reach 65% consumption of clean electricity by 2030. Additionally, for the first time, CEMEX has set ambitious goals for Scope 3 emissions, showing CEMEX’s commitment to decarbonising its entire value chain.
“Our products are essential for the well-being and development of humanity, and I am convinced that the transition to a net-zero industry is feasible,” added González. “Moreover, the journey to decarbonisation can be profitable, as our customers reward those companies that are leaders in this global transition.”
Earlier this month, CEMEX became one of the first companies in the cement industry to have its 2030 decarbonisation targets verified by the Science Based Targets initiative for alignment with their 1.5ºC scenario, the most ambitious scenario available to the industry.
Vertua, the CEMEX’s portfolio of sustainable and lower carbon products, is the linchpin of its contribution to decarbonising the built environment and building a better, more sustainable future for all. One of the most accepted lower carbon products in the industry, Vertua has seen strong adoption across CEMEX’s markets. The company expects Vertua lower carbon products to account for most of its cement and concrete sales by 2025.
CEMEX launched its Future in Action programme in March of 2021 to build a more sustainable, circular future, with the primary objective of becoming a net-zero CO2 company. Since then, the company has achieved record-breaking CO2 reductions, and its performance has given it the confidence to achieve a more accelerated pathway for 2030.
CEMEX committed to the following 2030 goal vs a 2020 baseline:
• Reduction in scope 1 emissions of 31% per ton of cementitious material.
• Reduction in scope 2 emissions of 58% per ton of cementitious material.
• Reduction of scope 3 emissions of 25% per ton of purchased clinker and cement.
• Reduction of scope 3 emissions for 40% per ton of purchased fuels.
• Reduction of 42% in absolute scope 3 emissions from the use of traded fuels.
• Reduction of 30% of scope 3 emissions from upstream transportation and distribution per ton of materials transported.
