Companhia Siderurgica Nacional's expansion drive

In the last few weeks, Companhia Siderurgica Nacional (CSN) has made an exclusive agreement with InterCement Participacoes SA to potentially acquire a 100 per cent stake in InterCement's stock, which includes a 51 per cent share in Loma Negra (Argentina) and a minor share in Cementos Del Plata SA (Uruguay). CemNet looks at CSN Cimentos' eagerness to expand its presence in the Brazilian market and its sudden rise to potentially rival Votorantim, the market leader in Brazil.

InterCement Brasil is a big player in its domestic market with seven integrated plants and five grinding plants and a total cement capacity of 16.38Mta, according to the Global Cement Report, 15th Edition. Its two largest integrated plants are the 3.2Mta Apiaí cement plant in São Paulo, followed by the 2.1Mta Cezarina plant in Goiás state. The sale of InterCement assets to CSN would elevate CSN to rival Votorantim's 36.31Mta of cement capacity in Brazil. 

The acquisition of InterCement Participações would cost around BRL6bn (US$1.16bn) according to local sources and would include CSN assuming responsibility for InterCement’s existing debts. It is estimated that InterCement has debts of approximately BRL9bn (US$1.75bn). InterCement Participações owns 34 production units with a cement capacity of more than 33Mta, operating in Brazil, Argentina and Uruguay.

A cement giant in the making

CSN was founded in 1941 and its roots are based in the steel sector, before expanding into the infrastructure sector in the 1990s and logistics and tin mining a decade later. Its development in cement took shape in 2007 when the the Arcos unit began extracting limestone for the Vargas plant in Volta Redonda and started to produce clinker. By 2015 CSN had increased its cement capcity to 5.4Mt with the inaugration of the Arcos cement plant, giving it access to the southeast region.

Expansion of the group in the domestic cement sector began in earnest with the acquisition of the 1.1Mta Cimento Elizabeth unit for approximately US$250m in 2021. CSN also planned a 3Mta integrated works in Paraná at this time, costing US$387.84m.

Following the acquisition of LafargeHolcim (Brasil) assets in 2022, CSN Cimentos has become the second-largest cement producer in Brazil with an installed capacity of 17Mta. It currently operates seven integrated cement plants, six grinding units, eight concrete and aggregate plans as well as 21 distribution centres.

Headquartered in São Paulo, CSN Cimentos has a strong presence in the southeast, midwest and northeast regions of Brazil with an increasing market share. The company increased its sales volume in 2023 by 76 per cent to 12.77Mta, of which bulk sales accounted for almost 40 per cent. 

Ongoing expansion programme

In addition to its pursuit of InterCement Participações SA, CSN Cimentos already has an investment plan of BRL5bn (US$970m) to install three new integrated cement plants, according to its 2023 annual report. This expansion alone will increase the company’s capacity by 47 per cent to 25Mta. The three new plants are planned for Aracaju (Sergipe) on the east coast, Paraná in the south and Pará in the northeast.