Global Cement Report: Tougher Environmental Controls May Restrict New Capacity

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In our view, companies should be explicitly including for environmental costs in their development appraisals, and we expect the providers of new equity and debt for these projects to increasingly insist upon this. A new cement plant typically has a cash cost of production of $30-40 per tonne. Adding $20-25 per tonne for carbon costs could make many projects unviable. We therefore expect the pace of new capacity additions to slow.

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