Appendix First 20171009110041965

ก 6
ก ก ก ก! " (Quicklime)
"- " (Hydrated Lime) 56! 7 (Limestone)
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7'

IndependentMarketResearchonQuicklime,
HydratedLime,andLimestone
FinalReport

August2017

©July2017,Frost&Sullivan
Themarketresearchprocessforthisstudyhasbeenundertakenthroughsecondary/desktopresearchaswell
asprimaryresearch,whichinvolvesdiscussingthestatusoftheindustrywithleadingparticipantsandexperts.
TheresearchmethodologyusedistheExpertOpinionConsensusMethodology.
Quantitativemarketinformationissubjecttofluctuationsduetopossiblechangesinthebusinessandindustry
climate. Frost & Sullivan s estimates and assumptions are based on varying levels of quantitative and
qualitativeanalyses,includingindustryjournals,companyreports,andinformationinthepublicdomain.
Forecasts, estimates, predictions, and other forwardͲlooking statements contained in this report are
inherentlyuncertainbecauseofchangesinfactorsunderlyingtheirassumptions,oreventsorcombinationsof
eventsthatcannotbereasonablyforeseen.Actualresultsandfutureeventscoulddiffermateriallyfromsuch
forecasts,estimates,predictions,orsuchstatements.
This study has been prepared for inclusion in the Prospectus of Chememan Public Company Limited (!the
Company") in relation to an initial public offering in connection with its listing on the Stock Exchange of
Thailand(!theListing").
Save for the inclusion of this study in the Prospectus issued by the Company and in such presentation
materialspreparedbyoronbehalfoftheCompany(reviewedbyFrost&Sullivan)inrelationtotheListing,no
partofitmaybeotherwisegiven,lent,resold,ordisclosedtononͲcustomerswithoutourwrittenpermission.
Furthermore,nopartmaybereproduced,storedinaretrievalsystem,ortransmittedinanyformorbyany
means,electronic,mechanical,photocopying,recording,orotherwise,withoutourpermission.
Frost&Sullivanhaspreparedthisstudyinanindependentandobjectivemanner,andithastakenadequate
care to ensure its accuracy and completeness. We believe that this study presents a true and fair view of
quicklime, hydrated lime, and limestone industries within the limitations of, among others, secondary
statisticsandprimaryresearch,anditdoesnotpurporttobeexhaustive.Ourresearchhasbeenconducted
with an !overall industry" perspective, and it may not necessarily reflect the performance of individual
companiesintheindustry.Frost&Sullivanshallnotbeliableforanylosssufferedbecauseofrelianceonthe
informationcontainedinthisstudy.Thisstudyshouldalsonotbeconsideredasarecommendationtobuyor
nottobuythesharesofanycompanyorcompaniesasmentionedinitorotherwise.
AuthorizedSignatory

SanjaySingh
SeniorVicePresident
Frost&Sullivan(S)PteLtd
100BeachRoad#29Ͳ01/11ShawTower
Singapore189702

IndependentMarketResearchonQuicklime,HydratedLimeandLimestone 2

TableofContents
MARKETSEGMENTATIONANDVALUECHAIN.....................................................................................................5
PRODUCTSEGMENTATION...............................................................................................................................................5
ENDUSEINDUSTRYSEGMENTATIONOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONE..............................................................7
VALUECHAINFORQUICKLIME,HYDRATEDLIME,ANDLIMESTONE.........................................................................................12
DESCRIPTIONOFVALUECHAINPARTICIPANTS....................................................................................................................14
MACROECONOMICOVERVIEWOFTHAILANDANDOTHERASEANCOUNTRIES...................................................15
GROSSDOMESTICPRODUCT(GDP)GROWTH...................................................................................................................15
MACROͲECONOMICOVERVIEWOFTHAILAND...................................................................................................................16
GDPContributionbyEconomicActivity..............................................................................................................16
MACROECONOMICOVERVIEWOFOTHERASEANECONOMIES.............................................................................................17
Indonesia.............................................................................................................................................................17
Malaysia..............................................................................................................................................................18
Singapore............................................................................................................................................................18
Philippines...........................................................................................................................................................18
Vietnam...............................................................................................................................................................19
RestofASEAN.....................................................................................................................................................19
BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINTHAILAND...........................................20
MarketOverview................................................................................................................................................20
MarketSizeEstimateandForecastofQuicklime,HydratedLime,andLimestoneinThailand..........................20
OverviewofImportandExportofQuicklimeandHydratedLimeinThailand....................................................21
IndustryDynamics...............................................................................................................................................23
RegulatoryIssuesandTrends.............................................................................................................................26
CompetitiveLandscapeinThailand....................................................................................................................27
IndustryOutlookforQuicklime,HydratedLime,andLimestoneinThailand......................................................29
BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEININDIA..................................................31
MarketOverview................................................................................................................................................32
MarketSizeEstimateandForecastofQuicklime,HydratedLime,andLimestone.............................................32
OverviewofImportandExportofQuicklimeandHydratedLimeinIndia..........................................................34
QualitativeOverviewofCompetitiveLandscape................................................................................................36
IndustryOutlookofQuicklime,HydratedLimeandLimestoneinIndia..............................................................37
BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINAUSTRALIA..........................................38
MarketOverview................................................................................................................................................38
OverviewofImportandExportofQuicklimeandHydratedLimeinAustralia...................................................40
IndustryOutlookofQuicklime,HydratedLime,andLimestoneinAustralia.......................................................43


BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIMEANDLIMESTONEINVIETNAM.............................................44
MarketOverview................................................................................................................................................45
OverviewofImportandExportofQuicklimeandHydratedLimeinVietnam....................................................48
IndustryOutlookofQuicklime,HydratedLimeandLimestoneinVietnam........................................................49
BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINJAPAN.................................................50
MarketOverview................................................................................................................................................51
OverviewofImportandExportofQuicklimeandHydratedLimeinJapan........................................................52
IndustryOutlookofQuicklime,HydratedLimeandLimestoneinJapan.............................................................54
BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINSOUTHKOREA.....................................55
MarketOverview................................................................................................................................................56
MarketSizeEstimatesandForecastsofQuicklime,HydratedLimeandLimestone...........................................56
OverviewofImportandExportofQuicklimeandHydratedLimeinSouthKorea..............................................57
IndustryOutlookofQuicklime,HydratedLimeandLimestoneinSouthKorea...................................................59
BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINCHINA.................................................60
MarketOverview................................................................................................................................................61
OverviewofImportandExportofQuicklimeandHydratedLimeinChina.........................................................62
IndustryOutlookofQuicklime,HydratedLimeandLimestoneinChina.............................................................64
BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINTAIWAN..............................................65
MarketOverview................................................................................................................................................66
OverviewofImportandExportofQuicklimeandHydratedLimeinTaiwan......................................................67
IndustryOutlookofQuicklime,HydratedLimeandLimestoneinTaiwan..........................................................68


MARKETSEGMENTATIONANDVALUECHAIN
ProductSegmentation

Limestone
Limestone is a sedimentary rock consisting predominantly of calcium carbonate (CaCO3). The remaining
components may include carbonate minerals such as dolomitic limestone (CaMg (CO3)2) and less commonly
aragonite(CaCO3).While limestone is generally lightͲcoloured (grey ortan) due to its high calcium content, it is
alsofoundinalmosteveryothercolour.Impuritiessuchassand,clay,hydroxides,ironoxide,andorganicremains,
especially on weathered surfaces, most likely cause the colour variations. Quarried limestone is a basic raw
materialusedtoproducevariousdownstreamproducts1,asshownbelow:
Limestone
Heat Grinding
GroundCalcium
Quicklime
Carbonate(GCC)
H2O CO2 PrecipitatedCalcium

HydratedLime
Carbonate(PCC)

Note:
1
Quarriedlimestoneisfurtherprocessedtoproducemultipleproducts,oftenreferredtoasdownstreamorvalueͲaddedproducts
:Referstothetargetmarketsegmentofthecompany
Ingeneral,ultrahighͲcalciumlimestonecontainsminimum97.5%calciumcarbonatecontent.Thecompany ChememanPublicCompany
Limited!hasultrahighͲcalciumlimestonereserveswithminimum98.0%calciumcarbonatecontent.

ExhibitSource:
TheNationalLimeAssociationhttp://lime.org/
EuropeanLimeAssociationhttp://www.eula.eu/
CompiledbyFrost&Sullivan


DefinitionofDownstreamProducts
Quicklime
CalciumOxide(CaO),knownasquicklime,isproducedbycalcininglimestoneathightemperature(above800°CͲ
1200°C). The temperature depends on the type of limestone used for the process and quality of quicklime
produced. As the quality of limestone differs from each quarry, an optimal calcining temperature is required to
processlimestoneandproducequicklime.Thechemicalprocessisasfollows:

Heat
CaCO3 CaO+CO2
HydratedLime
Hydratedlimeiscalciumhydroxide(Ca(OH)2)thatresultsfromthehydrationofcrushedquicklimewithan
adequateamountofwatertosatisfyitschemicalaffinity.Thechemicalprocessisasfollows:
CaO+H2OCa(OH)2+Heat

TypicalPropertiesofQuicklimeandHydratedLime
Properties Quicklime HydratedLime

PrimaryConstituent CaO Ca(OH)2
SpecificGravity(g/cc) 3.2Ͳ3.4 2.3Ͳ2.4
BulkDensitykg/cu.m 881Ͳ961 400Ͳ560
AngleofRepose 55° 70°
x Lumps:40!120
x PebbleLime:6.35!44.45 x 0.074Ͳ0.044
x PulverisedLime:0.841
SizeRanges(mm)
Source:


EndUseIndustrySegmentationofQuicklime,HydratedLime,andLimestone
Quicklime,hydratedlime,andlimestoneareusedinawiderangeofendusesegments.Thetablebelowillustrates
themarketsegmentationbyproductandrespectiveenduses:
EndUseIndustrySegmentationofQuicklime,HydratedLimeandLimestone
SegmentandSubͲSegment Quicklime HydratedLime Limestone

Mining
MiningUpstreamProcess 9 9 9
Metals
Ferrous(Iron&Steel) 9 9
NonͲFerrousMetal(e.g.,Aluminium,Copper,Zinc,Nickel) 9 9
PreciousMetals 9 9
Environment
DesalinationPlant 9
Waste&WaterTreatment 9 9 9
FlueGasTreatment 9 9 9
Incinerator 9
Glass
FibreGlass 9 9
Glass&Bottle 9
PCC
PrecipitatedCalciumCarbonate 9
Pulp&Paper
Pulp&Paper 9 9
Food
Sugar 9 9
Agriculture
AgriculturalFarm 9 9 9
AnimalFeed 9
Chemicals
Bioplastics 9 9
9 9
SodaAsh,PropyleneOxide,Epichlorohydrin,Bleaching

Powder,OilAdditives,CalciumCarbide
BuildingMaterials
AutoclavedAeratedConcrete(AAC) 9
LimeMortar 9 9
CementMortar 9
9:Referstosegmentswhereapplicableproductsareused.EndusesegmentsarenonͲexhaustive
Ingeneral,ultrahighͲcalciumlimestonecontainsminimum97.5%calciumcarbonatecontent.Thecompany ChememanPublicCompany
Limited!hasultrahighͲcalciumlimestonereserveswithminimum98.0%calciumcarbonatecontent.

Note:Segmentssuchascement,mortar,asphaltconcrete,dimensionstone,roadconstructionaggregatesareexcludedfromtheabove.Cement
Gradelimestonehasrelativelylesscalciumcarbonatecontent(60%Ͳ75%),andhenceexcludedfromanalysis.

Source:TheNationalLimeAssociationhttp://lime.org/


ConsumptionNorm:QuicklimeandHydratedLimeApplications
Quicklime and hydrated lime find extensive applications across multiple end use segments in Thailand; typical
consumptionnormsofkeyendusesegmentsareprovidedbelow.
Product EndUseSegment TypicalConsumptionNorm
Steel 65Ͳ70kgofquicklimepertonneofcrudesteelproduction
Paper 70Ͳ90kgofquicklimerequiredfor1tonneofpaperproduction
Quicklime Pulp 8Ͳ15kgofquicklimerequiredfor1tonneofpulpproduction
SugarRefinery 150Ͳ250kgofquicklimeneededforcrushing100tonnesofsugarcane
AACBlocks 1tonneofAACblocksrequires180Ͳ200kgofquicklime
Zinc Forproducing1tonneofZinc,around30Ͳ35kgofhydratedlimeisneeded
Hydrated
WaterTreatment 2Ͳ3tonsofhydratedlimepermillionlitresperday
Lime
EffluentTreatment Averagehydratedlimeconsumptionisabout2.5kg/cubicmetres
Source:Frost&SullivanAnalysis


Thefollowingsectionoutlinestheapplicationareasundereachendusesegments.
Mining
x Quicklime, Hydrated Lime and Limestone are extensively used in themining industry to refine and condition
metaloressuchasbauxite,alumina,copper,zinc,nickel,gold,andsilver.
Metals
x IronandSteel:Quicklimeispredominantlyusedinsteelmanufacturing,asafluxtoremoveimpuritiessuchas
silica,phosphorus,andsulphurinthemeltshop.
x NonͲFerrous:Quicklimeandhydratedlimeareusedtoremovesilicafrombauxiteoreandfor causticisation!
process to manufacture alumina. They are also used in the processing of ores and subsequent smelting and
refiningofzinc,copper,leadandothernonͲferrousores.
Environment
x Desalination Plant: Lime is the core chemical used in water treatment for softening and pH adjustment of
potableandindustrialwater.
x Water Softening: Hardness caused by bicarbonate and carbonate of magnesium and calcium is removed by
usinghydratedlime.
x pHAdjustment:HydratedlimeisusedtoadjustthepHlevelofwatertoprepareitforfurthertreatment.Lime
isalsousedtoneutraliseacidwater,thereforereducingcorrosioninpipes.
x IndustrialWastewater:Limeisusedbyneutralisingsulphuricacidinsteelmanufacturingplantswheretheiron
saltsareprecipitated.Italsoneutralisesandprecipitatescopper,chromeandheavymetalsinthetreatmentof
waterdischargedfromplatingplants.
x FlueGasDesulfurization(FGD):Limestoneisusedtoremovehydrogenchloride(HCl)andsulphurdioxide(SO2)
fromfluegases.HClremovalefficienciesusinglimerangefrom30%to50%atmunicipalwastetoenergyplants
andSO2removalefficienciesusinglimescrubbersrangefrom80%to99%atelectricgenerationplants.
Glass
x Fibre Glass: Lime is used in production processes of advanced engineering materials, such as fibre glass for
windturbineblades,toenablethegenerationofelectricityfromrenewableresources.
x Glass&Bottle:Limestoneisusedinglasssmeltingprocessasafluxforamendingdevitrificationandviscosity
alongwithincreasingthechemicalwearresistanceanddurability.
PrecipitatedCalciumCarbonate(PCC)
PCCisavalueͲaddedproductproducedbyhydrationofhighcalciumquicklimeandthentreatingitwithCarbon
dioxide.
KeyEndUseSegments ApplicationAreas
Paper PCCisusedtoimproveopticalpropertiesandglossiness
Paint Tomanufactureofemulsionpaintandpowdercoatings
Plastics Tomanufacturerigidplasticsproductssuchaspipes,drums,chairsetc.
OralCare Functionsasmildabrasive
Rubber Improvestheprocessabilitycharacteristicsandasfillertoreducethecost


Pulp&Paper
x Quicklime helps to liquefy nonͲcellulose wood elements and to recover caustic soda in pulp manufacturing
process.PCCisusedinpapermanufacturingasfillerandtoincreasepaperwhiteness,opacityandconsistency.
Food
x SugarRefining:Quicklimeandhydratedlimeareusedintwoapplicationareas
o Sugarjuiceflocculationand
o Carbonationprocessinsugarrefiningprocess
Agriculture
x SoilFertilisation:Quicklime,hydratedlime,andlimestoneareusedinagriculturefarmstoneutraliseacidsin
the soil and optimise soil conditions for crop growth. It helps to improve the soil structure, reducing soil
erosion.Limeisalsoarichsourceofcalciumionswhichisaplantnutrient.
x AnimalFeed:Limestoneisthemainsourceofcalciumusedinlivestockfeedforproperbonedevelopmentin
animalsandpoultry(meatbirdsandeggͲlayinghens),turkey,andpigs.
x Aquaticfarm:LimehelpstocontrolthepHlevelinfishandshrimpfarms.
Chemicals
x In the chemical industry, lime is used as a base material to manufacture inorganic and organic chemicals.
Calciumorganicandinorganicsaltsareproducedbyaddingvariousacidswiththelimebase.
x Inorganicproductsarecalciumphosphates(mono,di,andtri),fluoride,bromide,ferrocyanideandnitrate.
x Organicproductsarecalciumacetate,stearate,oleate,tartrate,lactate,citrate,benzoateandgluconate.
x Limestone and downstreamproducts are used as a neutralising agent (chemicalbase) in the manufacture of
chrome chemicals (bichromate), to aid in the concentration of glucose and dextrin, for purification of salt
brines,tomakemetalliccalcium,andanabsorbentandgaspurifier.
x Limeisusedforthedecontaminationofcitricacid.Hydratedlimeisaddedtoasolutionofcitricacidthathas
previouslybeenfilteredtoremovesuspendedsolids.
x Bioplastics: Bioplastics are environmentally friendly products, where hydrated lime is used to maintain an
optimalpHlevelduringacidogenicfermentationoforganicwaste.


BuildingMaterials
x Autoclaved Aerated Concrete: Quicklime is mixed with sand, water, cement, and aluminium powder to
produce slurry, which rises and sets to form honeycombͲstructured blocks. It offers excellent fireͲresistant
characteristicsandhighthermalinsulationperformance.
x LimeMortar:Itcanbemanufacturedfromeitherbylimestoneorhydratedlime.Ithashighwaterretention
andcreatesabondbetweenunitandmortars.Retentionofwaterimprovescarbonisationinlimemortarand
helpsearlyhydrationoflimemortars;reducecrackingandwaterpenetrationintohardenedmortarjoints.
x CementMortar:Cementmortarisproducedbymixinglimestone,sand,waterandotheraggregates.Itisused
forplasteringoverbricksandinothermasonryapplications.

Note:Typicallycementandsteelmanufacturershavetheirownlimestonequarriesfortheircaptiveuse.Segmentslikemortar,asphaltconcrete,
dimensionstone,roadconstructionaggregatesareexcludedfromtheanalysis.
Source:
CompanyWebsites


ValueChainforQuicklime,HydratedLime,andLimestone

Limestoneproductionbeginswithextractionfromquarries.Thematerialisthenloadedontotrucksthattransport
it to processing operations that include crushing, screening, and size classification. The quarried limestone is
initiallycrushedusingaprimarycrusherandthescreeningprocessseparatesthelumpsfromtheprimarycrusher.
Attheinitialreductionstage,undersizedlimestoneissoldascoarseaggregates.Washingoflimestoneisneededto
remove contamination like clay and dirt to achieve the required purity. The crushed product goes through a
secondarycrushertoreducefurtherthelimestonesizesthatcanbeusedforcaptiveconsumptiontomanufacture
downstream products or toother downstream productmanufacturers as a base material or sold to commercial
enduseapplications.Atypicalproductionprocessofquicklime,hydratedlime,andlimestoneisillustratedbelow:
ValueChainofQuicklime,HydratedLime,andLimestone

Limestone(CaCO3)
CaptiveUsebyCementand
SteelManufacturers
UndersizedLimestone
Limestone Primary Secondary

Screening Lumps StockPile
Quarries Crushing Crushing
Captive
Quicklime(CaO)
Lump/PebbleLime
LimeKilns
Calcination Lime Lime Bulk/HDPE
Crushing Silos Dispatch
Process Screening Sizing Packaging
Captive
HydratedLime(Ca(OH)2)
Hydrator
Bulk/HDPE
HydratedLime
Water HydrationProcess Packaging


Quicklime
Quicklimeisderivedfromlimestoneusinganindustrialprocess;theprocessedstoneistransportedbyconveyor
belttokilnstocalcine(heat)thelimestone;theheatturnsthelimestoneintoquicklime.Itisusedeitherforfurther
processingitintohydratedlimeorforcommercialenduseapplications.
CalcinationProcess
Limekilnsareusedinthecalcinationprocesstoproducequicklime.Limestoneispreheatedtoabout800°Cusing
exhaustgases;whenlimestoneisheatedthevolumeincreasesduetothermalexpansionandsmallcrystalsofCaO
are formed at calcining temperatures. This process proceeds until the whole limestone is converted into CaO,
which consists of several small crystals at this point. When the kiln temperature is higher than the calcining
temperature,littlecrystalsstarttounitize,andlargercrystalsform.Thisprocessleadstoshrinkageofthematerial
due to the settle up of the CaO crystals and the surface of the lime starts to dissociate faster; and when the
temperature reaches about 900°C, it turns limestone into quicklime. It then leaves the calcination zone and is
cooledbydirectcontactwithair.
Aftercalcination,thescreeningprocessseparatesthequicklimeintodifferentsizeslikepebbleorgranularforms
forvariousenduseapplications.Alternatively,itiscrushedintoevenfinersizesforcaptiveconsumptionortoend
usesegmentsthatrequirequicklimeinpowderform.Around1.8tonneofhighqualitylimestonewillbeusedto
produce1tonneofquicklime.
HydratedLime
Hydrated lime is produced in a vessel called a hydrator, where a precise amount of water is added slowly to
crushedorpulverisedquicklime.Duringthisprocess,largeamountsofheataregivenoffandconveyedtoanair
separator where most of the coarse particles are removed. The resulting hydrated lime is in a fluffy, dry white
powder.Around0.76tonneofquicklimecouldbeusedtoproduce1tonneofhydratedlimeafterthehydration
process.
Packaging
Quicklime and hydrated lime are delivered to end users in bulk through trucks, trailers, pneumatic tankers,
containersandinbags.

Source:
CompanyWebsites


DescriptionofValueChainParticipants
Multiple market participants exist in the value chain. Suppliers (also referred to as manufacturers or producers)
obtainamininglicensefromrelevantgovernmentbodiesordepartmentsforastipulatednumberofyears.They
extractlimestonefromtheallottedquarries,processitfurther,andthenselltheproducttoendusers.Suppliers
leasequarriesfromothercompanies,iftheydonothavetheirownquarries.Theyalsosourcefromotherquarries,
iftheirownquarriesdonotpossesstherequiredlimestonequalityandquantity.
Domesticsupplierssellquicklime,hydratedlime,andlimestonedirectlytoendusers.Foreignsuppliersdistribute
their products through logistic providers. Logistics providers obtain limestone products from suppliers through
seaports;someforeignsuppliersalsohavedistributionorsalesofficesinmultiplecountriestofacilitatemarketing,
sales,logistics/distributionactivities.
ValueChainParticipants

Owned
Limestone Foreign Logistic
Provider
Quarry Suppliers

Leased
EndUsers
Limestone
Quarry/Purchase

fromOthers

Owned Domestic
Limestone Suppliers
Quarry
Captive
Limestone
Quarry
Source:CompanyWebsites,Frost&SullivanAnalysis
Some foreign suppliers also initiate joint ventures or partnerships with domestic suppliers for mining limestone
and/or further processing. End users (manufacturers) source quicklime, hydrated lime, and limestone for use in
theirmanufacturingprocesses(fordiverseapplications,asstatedinthisreport).Steelandcementmanufacturers
havelimestonequarriesforcaptiveuse!thesequarriesandtheirmanufacturingfacilitiesaretypicallylocatedin
thevicinityforeaseoftransportation.


MACROECONOMICOVERVIEWOFTHAILANDANDOTHERASEAN1COUNTRIES
GrossDomesticProduct(GDP)2Growth
In 2016, the combined GDP of ASEAN s 10Ͳmember countries recorded USD2.5 trillion, firmly positioning the
regionasaglobaleconomicpowerhouse.WithinASEAN,IndonesiaisthelargesteconomyfollowedbyThailand,
the Philippines, Singapore, Malaysia, Vietnam, Myanmar, Cambodia, Laos PDR, and Brunei Darussalam, and
showing robust economic growth from 2011 to 2016. According to the International Monetary Fund (IMF), real
GDPgrowthinASEANwasapproximately4.9%in2016,significantlyhigherthantheglobalaverageof3.1%over
thesameperiod.ThefollowingchartillustratestheASEANcountries past(2011,2016)andprojected(2021)GDP
growth.
ASEANCountries:GDPatCurrentPrices(USDBillion),2011,2016,2021F
1600 1,466
RealGDPatCurrentPrices(USDb)
1400
1200
1000 932
893
800
600 539 526
449
371 407 330
400 298 296 305 291
276 297 224 175
200 135 201 99 111
0
Indonesia Thailand Malaysia Singapore Philippines Vietnam Others
2011 2016 2021F

Source:WorldEconomicOutlookReport,InternationalMonetaryFundEstimates April2017,compiledbyFrost&Sullivan
Note:OtherASEANCountriesincludeMyanmar,Cambodia,LaosP.D.RandBruneiDarussalam
ASEAN s economic outlook is forecast to remain buoyant, with an average 5.2% GDP growth predicted in the
regionfrom2017to2021.EconomicperformanceispoisedtoimproveasmajoreconomiessuchasIndonesia,the
Philippines, Vietnam and Thailand increase trade and investments over this period. Regional expansion of
multinational enterprises in Southeast Asia continues to be robust amid reductions in trade barriers. ASEAN
remainsakeydestinationforglobalForeignDirectInvestment(FDI),attractinguptoUSD120billion,representing
almost16%ofglobalFDIamongdevelopingcountriesin20153.
ASEANisaregionrichinmineralresourceswithvastpotentialfornewdiscoveries,andtheminingsector,inclusive
oflimestone,contributesapproximately4%oftheregion stotalGDP.Theregionalgovernmentsareseekingtoadd
value to their natural resources by retaining minerals for refining/processing in their own countries rather than
exportingunprocessedores.Strongpresenceofmajorendusesegmentssuchassteel,nonͲferrousmetals,paper
andagriculturewilldrivedemandforquicklimeandhydratedlimeproducts.

1
TheAssociationofSoutheastAsianNations(ASEAN)isanorganisationofcountriesinSoutheastAsiasetuptopromotecultural,economic,and
politicaldevelopmentintheregion.CountriesincludeThailand,Vietnam,Indonesia,Singapore,Philippines,Cambodia,LaoP.D.R,Malaysia,
Myanmar,andBruneiDarussalam
2
GDPisthemonetaryvalueofallthefinishedgoodsandservicesproducedwithinacountry'sbordersinaspecificperiod,usuallycalculatedon
anannualbasis.Itincludesallprivateandpublicconsumption,governmentoutlays,investmentsandexportslessimportsthatoccurwithina
definedterritory
3
UNCTAD WorldInvestmentReport2016


MacroͲEconomicOverviewofThailand
Thailand s real GDP recorded 3.2% in 2016, marginally higher than the 2015 rate of 2.9%, supported by
governmentͲled investments in infrastructure projects and increase in agricultural output. Favourable weather
conditionsinthesecondhalfof2016enabledagriculturaltopostgrowthat0.6%,markingasignificantturnaround
fromthe5.7%contractioninthepreviousyear.Thisledtoprivateconsumptiongrowthby3.1%from2.2%in2015.
Risingpricesforagriculturalproductsandfavourableweatherinthesecondhalfof2016alsoprovidedaboostin
farmincomeinnominaltermsby2.8%overthewholeyear,reversingthesteep9.6%reductionin2015.Having
contractedby2.2%in2015,privateinvestmentpickedupin2016byanestimated0.4%onthebackofagradual
recoveryinbusinesssentiment.
Thailand sGDPatCurrentPricesandRealGDPGrowth(USDBillion),2011Ͳ2021F
600 10.0
9.0
500
8.0
RealGDPGrowth%,
7.0
400
USDbillion
6.0
300 5.0
4.0
200
3.0
2.0
100
1.0
0 0.0
2011 2012 2013 2014 2015 2016 2017F 2018F 2019F 2020F 2021F
GDPatCurrentPrices(USDbillion) RealGDPGrowth%
Source:WorldEconomicOutlookReport,InternationalMonetaryFundEstimates April2017,compiledbyFrost&Sullivan

Sustainedrecoveryinthemajorindustrialsegments,robustdomesticconsumption,andimplementationoflargeͲ
scalepublicinfrastructureprojectsareexpectedtomaintainThailand sGDPgrowthrateat3%from2017to2021.
Withthegovernmentmaintaininganexpansionaryfiscalstance,publicinvestmenthascontinuedtobeacritical
growthdriver,likelysustainingovertheforecastperiod.NotablegovernmentspendingincludesUSD40billionon
infrastructure investment covering the construction of a doubleͲtrack rail line and a major motorway, and the
expansionofadeepͲwaterseaport.
GDPContributionbyEconomicActivity
In2016,manufacturing,wholesale/retailtradeandagricultureaccountedfor51%ofGDP.Manufacturinggrowth
increasedby1.4%,mainlysupportedbyincreasedproductionofexportͲorientedproductssuchaselectronictubes
andparts,metalandpetroleumproducts.Thewholesaleandretailtradesectorwitnessed5%yͲoͲygrowthdueto
an increase in household expenditure. The agriculture sector has grown by 0.6% yͲoͲy amid an increase in
productionandfavourableprices.
Theminingindustryisamajoreconomicactivity,contributingto2.8%ofGDPin2016.Thailand smineralindustry
isprimarilyengagedinminingandprocessingmetallicandindustrialmineralssuchasgypsum,kaolin,limestone,
dolomite,talcandfeldspar.


ThailandGDPContributionbyEconomicActivities(BillionBaht),2011Ͳ2016
Mining& Wholesaleand
Agriculture Manufacturing Others
Quarrying RetailTrade
2011 1,311 401 3,294 1,629 4,672
2012 1,422 483 3,474 1,777 5,201
2013 1,463 483 3,474 1,777 5,201
2014 1,330 496 3,671 1,870 5,837
2015 1,193 430 3,777 2,011 6,261
2016 1,199 399 3,939 2,216 6,613
Source:NationalEconomicandSocialDevelopmentBoard,Thailand
ThailandGDPContributionbyEconomicActivities(%),2011Ͳ2016
Mining& Wholesaleand
Agriculture Manufacturing Others
Quarrying RetailTrade
2011 11.6% 3.5% 29.1% 14.4% 41.4%
2012 11.5% 3.9% 28.1% 14.4% 42.1%
2013 11.8% 3.9% 28.0% 14.3% 42.0%
2014 10.1% 3.8% 27.8% 14.2% 44.1%
2015 8.7% 3.1% 27.6% 14.7% 45.9%
2016 8.3% 2.8% 27.4% 15.4% 46.1%
Source:NationalEconomicandSocialDevelopmentBoard,Thailand
MacroeconomicOverviewofOtherASEANEconomies
Indonesia
Supported by robust domestic consumption of goods and government investment in infrastructure projects,
Indonesia sGDPpostedmoderategrowthof5.0%in2016from4.9%in2015.In2016,15%oftotalbudget(USD20
billion)hasbeenallocatedtowardsinfrastructureforthedevelopmentofroads,railwaysandairports.4
Indonesia s economic growth outlook for 2017 to 2021 is expected to average at 5.3%, driven by improving
purchasing power, amid low inflation and a stronger Rupiah. Additionally, the 14 economic policy packages
releasedbytheIndonesiangovernment(sinceSeptember2015)whichincludederegulationandfiscalincentives
areexpectedtoboostinvestmentandresultineconomicdiversification.
In 2016, the mining sector accounted for about 4% of the country s GDP5. Indonesia has extensive mineral
resources, with deposits distributed throughout the country. Limestone mining is a major economic activity in
provincessuchasPapua,BangkaͲBelitung,WestNusaTenggaraandEastKalimantan.Strongdemandfrommining
and steel sectors is likely to support demand for quicklime, hydrated lime and limestone. Indonesia is ranked
among the world s five leading producers of mined copper and nickel, and among the world s top 10 gold
producers.Also,thecountryisamajorexporterofbauxite,coal,nickel,silver,andtin.6Steelproductionrecorded
aCAGRof6.2%,withcrudesteeloutputincreasingto5milliontonnesin2016,from3.7milliontonnesin2011.
Toelevatelocalminingbusinessesandsupportjobsindownstreamprocessingindustries,thegovernmentissued
an export ban on all unprocessed minerals from 2014 to 2016. Some construction activity has commenced in
downstreamprocessingfacilitiesinthelightofliftingofthebanonexports.Indonesiais,therefore,anetimporter
oflimestone.

4
https://www.iseas.edu.sg/images/pdf/ISEAS_Perspective_2016_3.pdf
5
MinistryofEnergyandMineralResources(ESDM)Indonesia
6
UnitedStatesGeologicalSurvey(USGS)


In 2016, around 100,000 tonnes of quicklime were imported; 84% from Vietnam followed by Malaysia 11% and
Thailand 3.5%. In 2016, around 12,000 tonnes of hydrated lime were imported; mainly from Malaysia (92%).
However,Indonesiaexported22,000tonnesofhydratedlimein2016,ofwhich97%wastothePhilippines.7
Malaysia
In 2016 Malaysia's economy registered a commendable growth of 4.2%, shaped by the growth in services,
manufacturing and construction sectors. The construction sector has witnessed a yͲoͲy growth of 7.4% in 2016,
while the services sector registered a growth of 5.6%. The manufacturing sector grew by 4.4% yͲoͲy, led by
demandformineralsandferrous/nonͲferrousmetals.Thegrowthforecastfor2017to2021isexpectedtoremain
strongat4.5%to4.8%drivenbyarecoveryinoilproductionandsupportivegovernmentpolicies.
In2016,theminingandquarryingsectoraccountedfor2.7%ofthecountry sGDP,registeringagrowthof2.2%yͲ
oͲy. Limestone deposits in Malaysia are abundant, with reserves located throughout Kedah, Kelantan, Negeri
Sembilan,Pahang,Perak,Perlis,SabahSarawakandSelangor.The5.2%yͲoͲygrowthincrudesteelproductionof4
milliontonnesin2016wasthemaindemanddriverforlimestone.Beingaleadingexporterofpalmoilandnatural
rubber,growthintheagriculturesectoraccountedfor7%ofGDP,supportingdemandforagriculturalquicklime
andhydratedlime.8In2017,MalaysiaisattemptingtocountertheEuropeanUnionresolutionwhichproposesto
curtail the use of oil palmͲbased fuel by 2020 over alleged production using unsustainable methods leading to
deforestation. If this resolution is passed, it can strongly impact palm oil production in the country, and
subsequently,decreaselimestoneconsumption.
Malaysiaisanetexporterofquicklimeandhydratedlime.India,Australia,Indonesia,thePhilippines,China,Chile
andPapuaNewGuineaareitskeymarkets.9
Singapore
In2016,theeconomyexpanded2%onthebackofaturnaroundinthemanufacturingsector. Themanufacturing
sector grew 3.6%, a reversal from a 5.1% decrease in 2015. This was driven largely by the electronics and
biomedicalmanufacturingclusters.Continuedrestockingoftechnologyproductsgloballycouldspurexpansionin
bothelectronicsmanufacturingandexternaltrade,pushingGDPgrowthhigherto2.2%in2017Ͳ2021.10
Withnegligiblemineralresources,SingaporehasadevelopedtradeͲorientedmarket.Quicklimeandhydratedlime
demand in the country is supported by demand from water desalination projects, and growth in the steel, oil
refineries, chemicals and construction sectors. The Public Utilities Board (PUB) annually spends USD609 million
towardwatersupplyandsanitationprojects.Theoilindustryaccountsfor5%GDPandSingaporeisamongstthe
topthreeexportrefiningcentresintheworld.11In2016,Singaporewasanetimporterofquicklimeandhydrated
limeimportingabout78,000tonnesand33,500tonnesofquicklimeandhydratedlimerespectively;mainlyfrom
Vietnam,MalaysiaandUnitedKingdom.12
Philippines
ThePhilippinesreportedaneconomicgrowthof6.5%from2011to2016!thehighestintheregion!supported
byrobustgrowthinconsumption,investments,andexports.Theeconomicoutlookremainsfavourable,expecting
toregistera6.8%to7.0%growthfrom2017to2021,drivenbydomesticdemandandexports.

7
UNCOMTRADE
8
DepartmentofMineralsandGeoscience(DMG)
9
UNCOMTRADE
10
MinistryofTradeandIndustry(MTI)
11
DepartmentofStatisticsSingapore(DSS)&PublicUtilitiesBoard(PUB)
12
UNCOMTRADE


According to the Mines and Geosciences Bureau (MGB), the mining sector accounted for almost 0.6% of the
Philippines sGDPin2016.Thesectoremploysabout218,000peopleandthecountry smetallicandnonͲmetallic
mineralexportswerevaluedatUSD2.5billionin2016.ThePhilippinesisaprominentimportmarketforquicklime
and hydrated lime due to high domestic demand from end use segments such as the chemical, paper, plastic,
rubberandsteelindustries.In2016,around28,000tonnesofquicklimeand42,800tonnesofhydratedlimewere
imported;predominantlyfromVietnam,Indonesia,MalaysiaandThailand.13
Vietnam
AccordingtotheGeneralStatisticsOffice(GSO),VietnamreportedaGDPof6.2%in2016.Theservicessectorgrew
by 7% yͲoͲy, contributing 2.7% to GDP, while industrial production and construction grew by 7.6%, contributing
2.6%toGDP.
Economicactivityfrom2017to2021isexpectedtoremainstrong,asbetterbusinessconditionssustainhealthy
FDIinflow!animportantgrowthdriverforanexportͲorientednation.TheVietnameseeconomyisexpectedto
witnessagrowthrateof6.3%to6.5%overtheforecastperiod,supportedbyrobustinvestment,surgingexports
andthegovernment scommitmenttomacroeconomicstability.In2016,itsminingsectorsawa4%yͲoͲydecline,
primarilyduetothelowpriceofcoalandcrudeoil.Withcloseto5,000depositswith60differenttypesofminerals
includinglimestone,miningisthecountry sfourthͲlargesteconomiccontributor.14
In2016,thetotalvalueofquicklime,hydratedLimeandlimestoneexportsreachedUSD65million,withdemand
mainlyfromTaiwan,SouthKorea,India,BangladeshandSingapore.Thesupplyanddemandofhydratedlimeare
low in Vietnam. It is a net exporter of limestone and quicklime. There has been a significant increase in the
production volume of limestone with the growth of the cement industry. Hence, there has been only negligible
importofquicklimeandhydratedlime.
RestofASEAN
AmongtheotherASEANeconomies,LaosandCambodianotedstrongeconomicgrowthfrom2010to2016,and
mainlyimportedquicklimeandhydratedlimefromIndonesia,Vietnam,Malaysia,andThailand.
LaosreportedgrowthbasedoncapitalͲintensiveinvestmentsintheenergysector.ItsGDPgrowthisexpectedto
reach 9.1% between 2017 and 2022, supported by improvements in agricultural production as a result of new
irrigationschemes.ThailandcontinuestobekeyexporterofquicklimeandhydratedlimetoLaos.In2016,about
55,721tonnesofquicklimeand38,969tonnesofhydratedlimewereimportedtoLaosfromThailand(ofwhich
25,370 tonnes of quicklime and 38,870 tonnes of hydrated lime were supplied by Chememan Public Company
Limited).15
Cambodiaexperienced9.5%growthfrom2010to2016duetostrongexportsandrealͲestateactivity.Agrowth
forecastof8.5%isexpectedthroughindustrydiversificationandsupportivepolicies.
Additionally,Myanmarwitnessedstrongeconomicgrowthfrom2010to2016,likelytosustainfrom2017to2021.
With structural reforms and strengthening FDI, economic prospects remain favourable. Brunei, the smallest
economy,hadanegativegrowthof3.3%from2010to2016;itisestimatedtoexperiencestronggrowthbetween
2017and2021at5.9%CAGRwiththeslightrecoveryinoilproduction.Withtheminingsectorstillinthenascent
stage of development, Myanmar, Laos, and Cambodia are largely reliant on imports, to cater to its large
agriculturalsectors.

13
UNCOMTRADE
14
http://www.businessinsider.in/AͲdarkͲshadowͲloomsͲoverͲaͲkeyͲpartͲofͲVietnamsͲeconomy/articleshow/57925398.cms
15
UNCOMTRADE


BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINTHAILAND
MarketOverview
Thequicklimeandhydratedlimefindsextensiveusageincoresegmentsofmetals&mining,sugar,pulp&paper,
construction, chemicals and bioͲplastics in Thailand. The quicklime and hydrated lime are value added products
producedindustrially(inkilns)andpricedmuchhigherthanlimestone.
Availability of high quality limestone from mineable reserves is important for the production of quicklime and
subsequently hydrated lime. In Thailand, other than Chememan, none of the competitors is granted mining
concessionsandtheyhavetosourcetheirfeedstockfromexternalparties.
Thailandproducesaround50typesofmetallicandnonͲmetallicmineralseveryyear,ofwhichlimestoneisakey
nonͲmetallicmineral.Thelimestone,keyfeedstockforquicklime,isminedmainlyinSaraburi,Lopburi,Ratchaburi,
andNakhonRatchasimainThailand.AccordingtoThailand sDepartmentofMineralResources,thecountryhad
approximately565milliontonnesofhighͲcalciumlimestonereservesasof2016.
MarketSizeEstimateandForecastofQuicklime,HydratedLime,andLimestoneinThailand
Demandforquicklimewasabout778,000tonnes,andhydratedlimewas132,000tonnesin2016,withafiveyear
historicCAGRof4.2%forquicklimeand5.8%forhydratedlime.Growthinkeyendusesectors(e.g.,sugar,steel,
pulp and paper) and the emergence of new sectors (e.g., bioͲplastics) will drive demand for quicklime and
hydratedlime,projectedtoregister4.5%and5.4%CAGRrespectively,from2016to2021.
MarketSizeofQuicklimeinThailand(Tonnes)2011Ͳ2021F
1200
MarketSizeinThousandTonnes
1000
800
600
902 970
400 778 802 817 845
664 690 720 726
634
200
0
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F

Source:DPIM,USGS,ForecastbyFrost&Sullivan


MarketSizeofHydratedLimeinThailand(Tonnes)2011Ͳ2021F
180
160
140
120
100
80 162 171
143 153
132 139
60 123
99 103 106 111
40
20
0
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F

Source:DPIM,USGS,ForecastbyFrost&Sullivan
Thailand slimestonequarries(mainlyfromSaraburiprovince)supplythisrawmaterialtothequicklimeproducers
inthecountry;localsupplyoflimestonecaterstothedomesticlimeindustry.Miningconcessionsforlimestone
quarries are held by external operators, thereby creating a supply reliability risk for majority of the quicklime
producers. However Chememan Public Company Limited has their own ultraͲhigh calcium limestone quarry (for
supporting their quicklime and hydrated lime facilities at multiple locations) which provide raw material
securitizationfortheforeseeablefuture,therebygaininganedgeoverothersintheThailandlimemarket.
OverviewofImportandExportofQuicklimeandHydratedLimeinThailand
Thailand is a net exporter of quicklime, hydrated lime and limestone; key export countries for quicklime and
hydratedlimeareLaos,India,AustraliaandCambodiawhileBangladesh,China,IndiaandNewCaledoniaarethe
majorexportcountriesforlimestone.Theimportandexportvolumesofquicklimeandhydratedlimeareshown
below.

ImportsofQuicklimeandHydratedLime(Tonnes),Thailand,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 42,300 1,900 7,000 21,700 100 3,300
HydratedLime 500 1,000 900 800 1,000 1,000
Source:UNCOMTRADE,Frost&SullivanAnalysis,ThaiCustomsDepartment
Numbershavebeenroundedoff

ExportsofQuicklimeandHydratedLime(Tonnes),Thailand,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 186,200 190,900 198,300 200,900 157,600 165,100
HydratedLime 29,000 25,800 31,100 42,000 49,700 71,900
Source:UNCOMTRADE,Frost&SullivanAnalysis,ThaiCustomsDepartment
Numbershavebeenroundedoff


QuicklimeandHydratedLimeExportSharefromThailand
Chememan Public Company Limited is the leading exporter of quicklime and hydrated lime from Thailand to
marketsinAsia,AustraliaandAfrica.In2016,Chememanaccountedfor82%ofthequicklimeandhydratedlime
exportsfromThailand.Chememanaccountedfor81%oftotalquicklimeexports,whileforhydratedlimeitsshare
was84%.Throughouttheyears,thecompanyhasbeenwellrecognizedasaleaderinthelimeindustryinAsia.In
order to strengthen its position, it continues to expand both horizontally and vertically in various locations in
Thailand,aswellasinothercountries.ChememanhassignedanewlongtermcontractwithanendͲuserinPapua
NewGuineaduring2017thisnewcontractislikelytoincreasetheirexportvolumes.Withreliabilityofsupplyand
consistentproductquality,thecompanyisexpectedtobecomeakeyplayerinitsexportmarkets.

Chememan sExportstoSelectCountries
ChememanPublicCompanyLimitedexported133,395tonnesofquicklimeand60,145tonnesofhydratedlimein
2016.India,Australia,LaosandJapanareitsmajormarketsforquicklime,accountingfor83%ofitstotalexports.
ASEANcountrieslikePhilippines,MalaysiaandIndonesiaaccountedfor10%ofthecompany squicklimeexports.
Bangladesh,SouthAfricaandNewCaledoniaaretheothermajorexportmarketsforthecompanyforquicklime.
ChememanExportsofQuicklimetoSelectCountries(Tonnes),2016
TotalImportsintothe ExportQuantityfrom ExportQuantityby
Country
Country Thailand Chememan
India 469,000 48,093 46,713
Australia 76,000 33,000 30,495
Vietnam 2,050 14 Ͳ
Japan 8,900 8,800 8,600
SouthKorea 45,600 920 906
China 1,300 Ͳ Ͳ
Taiwan 428,100 51 Ͳ
Laos 63,328 55,721 25,370
Indonesia 99,911 8,542 8,516
Philippines 28,000 2,788 2,347
Source:ChememanPublicCompanyLimited,Frost&SullivanAnalysis


Australiaaccountsfor18%ofChememan shydratedlimeexports.LaosandPhilippinesarethemajorimportersof
hydratedlimefromChememan,accountingfor79%ofitsoverallhydratedlimeexports.

ChememanExportsofHydratedLimetoSelectCountries(Tonnes),2016
TotalImportsintothe ExportQuantityfrom ExportQuantityby
Country
Country Thailand Chememan
India 13,900 540 540
Australia 22,650 11,508 10,702
Vietnam 640 163 Ͳ
Japan 283 Ͳ Ͳ
SouthKorea 407 Ͳ Ͳ
China 3,100 Ͳ Ͳ
Taiwan 641 Ͳ Ͳ
Laos 39,214 38,969 38,870
Indonesia 12,454 48 Ͳ
Philippines 42,800 11,472 8,527
Source:ChememanPublicCompanyLimited,Frost&SullivanAnalysis
IndustryDynamics
GrowthDrivers
x Economic Outlook: The IMF projects a positive economic outlook for Thailand, with real GDP forecast to
expandby3.3%16from2016to2021.Muchofthisgrowthislikelytobeledbyincreasedproductionacross
major sectors such as agriculture and manufacturing, driving demand for limestone and other valueͲadded
productsoflimeoverthesameperiod.
x Steel: Thailand s steel consumption reported a growth of 16%17, mainly from construction and automotive
sectorsfrom2015to2016.AccordingtotheWorldSteelAssociation,thesteelindustryislikelytogrowata
steadypaceof3.3%creatingdemandopportunitiesforquicklimeandlimestonefrom2016to2021.
x Paper and pulp: Thailand consumed 4.7 million tonnes of paper, with a production of 4.6 million tonnes in
2016;theindustryplanstoadd450,000tonnesofnewcapacityfrom2016to2021.TheThaiPulpandPaper
IndustriesAssociation(TPPIA)expectsthepaperindustrytoseeagrowthofbetween4%and6%from2016to
2021,significantlyimpactingquicklimeandlimestonedemandoverthesameperiod.
x Flue Gas Treatment: In 2016, approximately 20% of Thailand s energy consumption was addressed through
coalandfueloilanddieselͲfiredpowerplants.TheMinistryofEnergyestimatesthecontributiontoreach39%
by2030,fuellingdemandforquicklime,hydratedlimeandlimestone.Moreover,thereisgrowinginterestin
theenergyͲfromͲwasteproduction;withtheMinistryofEnergyalsotargetingtopromoteenergyͲfromͲwaste
(EFW)production18to160megawattsofpowerand100kilotonnesofoilequivalent(ktoe)ofthermalby2021.
LargeamountsofsolidwastegeneratedinthecountrywouldbeusedtoproduceEFWinsteadofputtingthem
inlandfills,withstrongsupportfromtheThaigovernmentintheformofincentives.Singaporehasalsobeen
takinggiantstridesintheenergyͲfromͲwasteprogrammeswithThailandlikelyseekingtoemulatethesuccess
ofitsASEANcounterpart.

16
IMFforecasts,2016
17
IronandSteelInstituteofThailand(ISIT),March2017
18
DepartmentofAlternativeEnergyDevelopmentandEfficiencyͲMinistryofEnergy


x Sugar: The first SͲcurve industry in Thailand. The country is the second largest sugar exporter globally only
nexttoBrazilandthefifthlargestproducerglobally.Itexportedabout8milliontonnesofitstotal10million
tonnesproducedin2015.Moredemand!fromanumberofapprovednewsugarmills,cropareaexpansion,
andcropyieldimprovement,favorabledomesticpricingandnewinvestmentsapprovedinthesector!islikely
tocreaterobustgrowthinthelongterm.
x WaterTreatment:Hydratedlimeisusedinpotablewatertreatmentplants,sewagewatertreatmentplants,
and industrialwater treatment plants. Thequantities used at these plants differ depending upon the water
quality.Frost&Sullivanprojectsthelimeconsumptionnormpermillionsoflitresperday(MLD)atbetween2
tonnesand3tonnes.Thailand!surbansegmentisestimatedat50%oftheoverallpopulationwithanannual
growthof3%from2010to2016.19Urbangrowthislikelytodriveportablewaterdemand,inturn,increasing
theusageofhydratedlimeinthissegment.
x InfrastructuralInvestments:ThecountryhasallocatedabudgetofUSD75billion(THB2.4trillion)fornational
developmentaimedatdevelopingthenation!sport,rail,androadinfrastructureby2022.Theseinvestments
are expected to stimulate demand for many key end user segments of quicklime, hydrated lime and
limestone.
x Bioplastics: Agricultural feedstock such as sugar cane and cassava, wellͲdeveloped infrastructure for
petrochemical and plastic processing industries and proximity to leading bioplastic markets such as China,
Japan,andTaiwan,positionThailandasanintegratedbasefortheproductionofbioplastics20.Corbionplansto
beginoperationsofits75,000tonnesperannumbioplasticplantinRayongProvinceby2018.AnewSͲcurve
industry,thebioplasticssectorislikelytowitnesstremendousgrowthinThailand.
x Buildingmaterials:Themarketforbuildingmaterials(AACblocks,mortar,etc.)inThailandispoisedtoexhibit
healthygrowthovertheforecastperiodowingtoconstructionsectorgrowth(massiveinvestmentsinpublic
infrastructure projects), growing population coupled with rapid urbanization, and improved economic
conditions.TheAACblocksareconsideredenvironmentfriendlycomparedwiththetraditionalbricksandalso
offer multiple advantages (lightweight, fire resistant, sound proof, etc.,) over the traditional bricks. The
demandforquicklimeintheAACblocksissettogrowsubstantiallyinthecomingyears.
GrowthRestraints
x InvestmentClimate:WithageneralelectionloominginThailand,by2018,concernsoverpolicyuncertainties
could curtail fresh investments in key industries such as steel and construction, adversely impacting the
quicklimeandlimestonemarket.21
x Global Steel Growth: Thailand is a net exporter of limestone and actively trades with steelͲproducing
countries.Inthemediumterm,ThailandisparticularlyexposedtoaslowdowninChina!ssteelindustry,being
its key trading partner. Any volatility affecting business growth in these countries could directly impact
Thailand!slimestoneexportsinthelongterm.
x Substitute Products in Environmental Protection: Substitute products in waste & water treatment, flue gas
treatment, etc. could adversely impact the quicklime and hydrated lime market but with the substitute
productslikelytobemoreexpensive,theimpactisminimal.
x AntidumpingDuty:ImportsofquicklimeandhydratedlimefromThailandcouldbeimposedwithantidumping
duty,andthiscoulddeterexportopportunitiestocertainneighbouringmarkets.Howeverwithpaucityofhigh
qualityproductsupplyinthosemarkets(likeAustralia);suchdutiesareunlikelytobeeffected.

19
https://www.cia.gov/library/publications/theͲworldͲfactbook/fields/2212.html
20
innoBioplast2013(http://www.plastics.gl/exhibit/thailandͲaͲregionalͲbioplasticͲhub/)
21
AsianDevelopmentBank


QuicklimeandHydratedLimeDemandSplitbyKeyEndUseSegments(%),2016
2% 1% 2%
4% Construction
Sugar
7% 20% Steel&Metal
Pulp&Paper
14% Chemicals
19% Bioplastics
Mining
14%
Agriculture
17% Environmental
Others

QuicklimeandHydratedLimeDemandSplitbyKeyEndUseSegments(Tonnes),2016
EndUseSegments MarketSizein2016(Tonnes)
Construction 194,000
Sugar 184,000
Steel&Metal 165,000
Pulp&Paper 136,000
Chemicals 136,000
Bioplastics 68,000
Mining 39,000
Agriculture 19,000
Environmental 10,000
Others 17,800
Construction,sugar,steelandmetalindustriesaccountedformorethanhalfofthequicklimeandhydratedlime
demand in Thailand. Quicklime and hydrated lime consumption in the construction sector was around 194,000
tonnesin2016holdingthelargestshareofdemandat20%;thesectorhasbeenperformingwellduetothruston
infrastructure projects from the government and boost to residential construction. Sugar industry demand for
quicklime is the second largest, estimated at 184,000 tonnes, because of a wellͲestablished sugar industry with
significantglobalexports.Demandfromthesteelandmetalsegmentstoodatabout165,000tonnesin2016.Pulp
and paper, and the chemical industries consumed 136,000 tonnes each of lime, accounting for 28% of total
demand. Bioplastics, mining, agriculture and environmental activity, and other miscellaneous applications
contributedto16%ofdemand,collectivelyconsuming153,800tonnesofquicklimeandhydratedlime.


RegulatoryIssuesandTrends
Thailand!s Department of Mineral Resources (DMR), under the Ministry of Natural Resources and Environment,
managespoliciespertainingtotheminingindustry.TheDMRperformsthefollowingduties:
x Plansanddraftspoliciesformanagementofallmineralresourcesinthecountry
x Enforcesminerallegislation
x Recommendschangesandupdatestominerallegislation
x Conductsgeologicalsurveysonmineralreserves
x Framesgeologicalandmineralstandards

MininglawsinThailandareprincipallygovernedbytheMineralsAct(1967;amendedin1979).UndertheMinerals
Act,allmineralreservesarevestedintheState.Miningactivitycannotbeinitiatedwithouteitheranexploration
licenceorminerallicence.Anynewplayerwhowouldwanttoenterintothelimestonemarketorgetaccessto
limestonemineswouldhavetofirstgetagovernmentapproval!EnvironmentalImpactApproval(EIA)"whichis
likelytoactasadeterrentforanewentrant.

Foreign ownership is not permitted in Thailand s mining sector; however, foreign investors can enter into
agreementswithThaicompaniestoobtainaminingpermit.Theseagreementsaresubjecttoapprovalsfromthe
Department of Primary Industries and Mining (DPIM). Thailand s Board of Investments (BOI) typically oversees
foreigninvestmentactivities;mininglicencesmaybeobtainedunderspecialshareholdingagreementswithlocal
Thaicompanies.

The Mining Act 2017 (repealing the old Act) recently published in the Royal Gazette on March 2, 2017, is fully
effectiveAugust30,2017,andreflectsmajorchangesrelatingtominingprovisionsanditstariffs.Thenewbillaims
to decentralise and streamline the mining licencing process involving local and regional authorities along with
relevantcommitteesapprovingoroverseeingminingoperations.

The Ministry of Natural Resources and Environment (MNRE) and the Ministry of Industry (MOI) have been
entrusted with the responsibility of enforcing the Act and issuing regulations when necessary. The National
Mineral Administrative Policy Board, to be established, will oversee the preparation of a national minerals
administrative master plan covering resource surveys, mining regulations and restrictions on certain kinds of
mineralsandadministrativeguidelinespromotingeconomic,social,environmental,andhealthrequirements.The
MineralCommitteeandProvincialMineralCommitteesarealsotobeestablishedtomanagebidding,approvalsfor
licences, renewals, revocations of conditions for mining activities according to the scale. The newlyͲadded
municipal and subͲdistrict administrative committees could help shorten the time taken to process applications
anddecreaseduplicationofdocumentationtospeeduplicencingapprovals.

ThenewMiningActspecifiesstricterapprovalprocess,development/restorationplans,andsupportfrompublic
hearing/local communities and higher administrative tariffs. Entry barriers for new companies that are entering
limestone quarrying are likely to increase with the implementation of new act. However established market
participantshaveacompetitiveadvantagebywayoftheirexistingvalidityoftheirmininglicence.


CompetitiveLandscapeinThailand
ThaiͲbasedproducersdominatethequicklimeandhydratedlimemarketinThailand.ChememanPublicCompany
Limited, Golden Lime, Lime Master, and United Lime are key producers in the commercial market (excluding
cement companies with limestone mines for captive use). Chememan Public Company Limited has high quality
limestone reserves of about 115 million tonnes in the Saraburi Province of Thailand. Other producers procure
limestonefromtheirassociatecompaniesandexternalsourcesholdingmining.Carmeuseistheonlyforeignlime
producerinThailand,afteritsacquisitionofGoldenLimein2016.
Asof31stDecember2016,ChememanPublicCompanyLimitedhadthelargestcapacityforquicklimeandhydrated
limeinThailand.
QuicklimeKilnsinThailand HydratedLimeCapacityinThailand
InstalledCapacity(asof31stDec!16)* InstalledCapacity(asof31stDec!16)*
InstalledCapacity InstalledCapacity
CompanyName CompanyName
TonsPerYear(TPY) TonsPerYear(TPY)
ChememanPublic ChememanPublic
711,750 87,600
CompanyLimited CompanyLimited
Competitor1 328,500 Competitor1 86,400
Others 299,320 Others 85,296
Total 1,733,750 Total 414,816

ComparisonofInstalledCapacities:GlobalLimeProducersandChememanPublicCompanyLimited
GloballyLhoist,CarmeuseandSibelco,withproductionfacilitiesacrosstheglobearemajorproducersofquicklime
andhydratedlime.OthermajorplayersincludeGraymont,Calidra,MississippiLime,FelsandICAL.Limecompanies
like CRH, Nordkalk and Adelaide Brighton have an installed capacity between 1.0 to 1.2 million tonnes and are
ranked among the top 10 lime producers globally. With an installed capacity of 0.8 million tonnes, Chememan
PublicCompanyLimitedisexpectedtobeamongthetop10limeproducersintheworldby2020.

*
BasedoninformationsharedbyTheCompany.F&Shasnotindependentlyverifiedsuchdata/information


EstimatedMarketShareforQuicklimeandHydratedLimeinThailand
In 2016, Chememan Public Company Limited held the largest share (28%) of the quicklime and hydrated lime
market in Thailand. The top three players contributed to 69% of the quicklime and hydrated lime market in
Thailandin2016withimportscontributinglessthan1%.WiththenewMiningActinplaceandlimitedhighquality
limestone quarry with feasible mineable reserve, the market is relatively closed for new entrants. The market
shareforquicklimeandhydratedlimeisprovidedbelow:
EstimatedMarketShareforQuicklimeinThailand(%),2016
0.4%
Chememan
18.8%
29.1% Competitor1
Competitor2
9.7%
Competitor3
16.6% Others
25.4%
Imports

EstimatedMarketShareforQuicklimeinThailand(Tonnes),2016
Company SalesVolume2016(intonnes)
ChememanPublicCompanyLimited 226,246
Competitor1 197,610
Competitor2 129,240
Competitor3 75,380
OtherCompetitors 146,211
Imports 3,300


EstimatedMarketShareforHydratedLimeinThailand(%),2016
0.8%
Chememan
21.2%
26.1% Competitor1
Competitor2
18.3% Competitor3
16.2% Others
17.4% Imports

EstimatedMarketShareforHydratedLimeinThailand(Tonnes),2016
Company SalesVolume2016(intonnes)
ChememanPublicCompanyLimited 28,027
Competitor1 24,174
Competitor2 22,982
Competitor3 21,316
OtherCompetitors 34,461
Imports 1,000
QualitativeCommentsontheM&AintheIndustry
In 2016, Carmeuse, a lime producer, headquartered in Luxembourg, and BangkokͲbased GP Group (Gangjee
Premjee&Co.),withactivebusinessesinenergy,logistics,realͲestate,construction,andsoftware,jointlyacquired
Golden Lime Public Limited Company (a publicͲlisted lime producer in Thailand headquartered in Bangkok).
Carmeusehasreportedlyacquireda45%stakeinGoldenLime.
IndustryOutlookforQuicklime,HydratedLime,andLimestoneinThailand
In the end use segments, the longͲterm growth prospects for quicklime and hydrated lime are healthy and
attractive.Demandforquicklimeandhydratedlimeisprojectedtogrowinexcessof5%CAGRoverthe2016to
2021period;quicklimedemandissettoreach1.07milliontonnesby2021.
Compliance with the new Mining Act 2017 ushering in administrative changes/challenges, stringent regulations,
andhighertariffsmaybeeasierforestablishedindustryparticipantsthanthesecondaryplayersornewentrants.
Given these high barriers to entry, a new participant may face restrictions in accessing highͲquality limestone
quarrieswithfeasiblemineablereserves.


Quicklimeandhydratedlimeimportshavebeennegligibleovertheyearsduetothehighcostsassociatedwithsea
logistics, warehousing and customs requirements, making imports costlier compared with the domestic supply.
This is unlikely to change in the foreseeable future. The export of highͲquality quicklime and hydrated lime
continuestoremainsteady,withChememanPublicCompanyLimitedbeingthefrontrunnerintheexportmarket.
Thepricesofquicklimeandhydratedlimemainlydependonqualityandexistingmarketcompetition.Acompany
cancommand a higherprice if demand ishigh, andquality is unmatched by other manufacturers.Onthe other
hand, in a high competition market wherein manufacturers aim to maintain or increase their respective market
shares, a company with superior product quality will have to decrease its price in order to remain competent.
Majority ofcompanies in Thailand inthequicklime and hydrated limemarkets donot holdtheir own limestone
quarries. Chememan Public Company Limited, with its own quarry at Tubkwang, is assured of consistent high
qualitylimestonesupply,andhenceislikelytocommandapremiumforitshighqualitydownstreamproductsin
theforecastperiod.


BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEININDIA
CountryOverview
GrossDomesticProduct(GDP)Growth
India sustained strong growth momentum from 5.5% in 2012 to 7.95% in 2015, on the back of marketͲfriendly
policiesthatsafeguardedthecountryfromthesubduedglobaleconomy,improvedmacroeconomicfundamentals,
androbustcapitalinflow.TherealGDPislikelytoreboundto7.2%in2017from6.8%in2016.GDPdeclinedto
6.8%in2016from7.9%in2015duetocashshortagepostͲdemonetisation,accompanyingthecurrencyexchange
initiative. The IMF forecasts India!s real GDP growth at between 6.8% and 8.1% from 2016 to 2021, due to
demonetisation,implementationoftheGoodsandServicesTax(GST),andotherstructuralreforms.

RealGDPGrowthRateandGDPValue,India,(USDBillion),2011Ͳ2021F

RealGDPGrowth%

GDPUSD(Billion)

) ) ) ) )
*'386'%Q 5HDO*'3JURZWK

Source:IMF,WorldEconomicOutlookReport,April2017,CompiledbyFrost&Sullivan

TheservicessectorisamajorcontributortotheIndianeconomy;trade,hotelsandrestaurants,transport,storage
andcommunication,financing,insurance,realͲestate,businessservices,community,socialandpersonalservices,
andservicesassociatedwithconstructionaccountedfor45.4%ofGDPin2016.Theindustrialsectoristhesecond
largest contributor that accounted 30% of GDP in 2016. Steel production is a major segment in the industrial
sector,withIndiabecomingthethirdͲlargestproducerofsteel(96milliontonnes)22,andsecondͲlargeststainless
steelproducerglobally(3.32milliontonnes)23from2016to2017.TheWorldSteelAssociationprojectsIndiansteel
demand to grow by 5.7% in 2017 due to the country!s continued expansion in urban infrastructure and the
manufacturingsector.
In 2016, the Indian mineral sector contributed 2.6% to GDP, producing over 80 minerals, including metallic and
nonͲmetallic resources. Limestone is a major nonͲmetallic mineral in the country with almost all states in India

22
MinistryofSteel
23
http://economictimes.indiatimes.com/industry/indlͲgoods/svs/steel/indiaͲbecomesͲsecondͲlargestͲsteelͲproducerͲinͲtheͲworld


producing some quantities of limestone. According to the Indian Bureau of Mines(IBM), India has close to 8.98
billion tonnes24 of proven limestone reserves, with 75% of the total production coming from Madhya Pradesh,
Chhattisgarh,AndhraPradesh,Rajasthan,Gujarat,andKarnataka.Cementgradelimestoneaccounted87%ofthe
reserve, followed by steel grade 7% and highͲcalcium limestone grade 6%. In addition to its internationallyͲ
recognisedprovenandprobablereserves,Indiahassignificantquantitiesofmineralresourcesinvariousstagesof
exploration. With appropriate investments for exploration infrastructure and technology, there is enormous
potentialintherealisablemineralwealthofIndia.
Government initiatives such as the 100% FDI under automatic route, changes in customs and excise duties, a
betterlegislativeenvironmentforinvestmentandtechnologyfacilitatedbytheMinesandMineralsDevelopment
and Regulation (MMDR) Bill (1957 Act, 2011 and further amended in 2016), and rapid industrialisation are
anticipatedtoboostdemandforquicklime,hydratedlimeandlimestonefrom2016to2021.
MarketOverview
India ranks among the leading limestone producers globally with a production of 18.2 million tonnes (of highͲ
calciumlimestone)in2016.ThehighͲcalciumlimestone(withlowsilicacontent)ismainlyavailableinthestateof
RajasthaninIndia.Thecountry!slimestoneconsumptionin2016reached18.1milliontonnes,whilequicklimeand
hydrated lime consumption were estimated at 3.5 million tonnes and 0.5 million tonnes respectively. The steel
industry accounted for the highest quicklime demand, followed by sugar, aluminium, copper, paper & pulp and
chemicals in 2016. Hydrated lime demand in India primarily arises from water treatment, chemicals (bleaching
powder),andnonͲferroussegments.
MarketSizeEstimateandForecastofQuicklime,HydratedLime,andLimestone
Demandforquicklimeisestimatedat3.5milliontonnesin2016,andlikelyachievingaCAGRof6.5%toreach4.8
million tonnes by 2021. Steel industry is the largest consumer of quicklime in India; majority of the steel plants
havetheirowncaptiveplantsforproducingquicklime.Theyimporthighqualitylimestone(withlowsilica)from
countrieslike UAEandOmanforcateringtotheirquicklimerequirement.Withthesteelcapacityanticipatedto
reach an enormous 300 million tonnes by 203025, the demand prospects for steel industry!s raw materials (like
quicklime)issettoincreasesignificantlyinthecomingyears.Indigenousmanufacturerspredominantlymeetthe
supplyneedsforhydratedlime,withdemandin2016expectedtorecordaCAGRof4.7%from2017to2021.

24
http://ficci.in/spdocument/20317/MiningͲIndustry.pdf
25
NationalSteelPolicy2017


MarketSizeforQuicklimeinIndia(Tonnes),2011Ͳ2021F
6,000
5,000
4,000
3,000
4,484 4,784
2,000 3,678 3,935 4,218
3,490
2,886 3,051 3,232
2,486 2,664
1,000
Ͳ
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F

Source:IndianBureauofMines,USGS,ForecastbyFrost&Sullivan

MarketSizeforHydratedLimeinIndia(Tonnes),2011Ͳ2021F
800
700
600
500
400
676 704
300 608 640
560 575
492 519
441 465
200 416
100
Ͳ
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F

Source:IndianBureauofMines,USGS,ForecastbyFrost&Sullivan

Limestoneisfoundinabundanceacrossthecountry,howeverthechemicalspecificationsneededforproduction
of quick lime from limestone requires its CaO content to be very high (excess of 90%) with low SiO2. This high
qualitygradelimestoneisnotavailableinallthestatesexceptinthestateofRajasthan.Withinlandtransportation
costspushingproductpriceshigherforfaroffkeydemandlocations,importsofthesamebecomesthefeasible
option.ImportsoflimestonefromtheUAE,Omanandothercountrieshavebeengrowingconsideringthequality
oflimestoneanditsassociatedlowerdeliveredcosts.


OverviewofImportandExportofQuicklimeandHydratedLimeinIndia
Indiaisanetimportmarketforquicklime,hydratedlimeandlimestoneowingtoincreasingdemandfromthesteel
industry.ThehighͲcalciumlimestoneisavailableinlargescaleinstateofRajasthan(NorthWestpartofIndia)very
farfromeastcoastofIndiawhereallthesteel,alumina,copperandpapercompaniesarelocated.Hencethough
limestonereservesareavailable,theyarefarfrompointofuse,andduetohighcostoflogisticstomovewithin
India,importsareconsideredmuchcheapertoports.

QuicklimeimportsintoIndiawereprimarilyfromVietnam,Oman,theUAE,MalaysiaandThailandin2016.Imports
ofquicklimefromThailandintoIndiaamountedtoabout48,093tonnes,accountingforabout10%oftheoverall
imports. Demand for hydrated lime is mostly addressed through domestic production; India imported 13,900
tonnesofhydratedlimein2016,mainlyfromMalaysia.India!shydratedlimeexportsaremainlytargetedinSouth
Asia,withBangladeshaccountingapproximately52%oftheexports,followedbySriLankaandBhutan.

India exported about 0.25 million tonnes of limestone, mainly to Bangladesh, the United Kingdom, France, and
Ireland in 2016. The country imported limestone mainly from UAE, Oman, Malaysia, and Vietnam in 2016 and
about 350,000 tonnes of limestone from Asian countries including 18,000 tonnes of limestone from Thailand in
2016.

ImportsofQuicklimeandHydratedLime(Tonnes),India,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 385,000 574,000 523,000 558,000 550,000 469,000
HydratedLime 23,300 23,400 23,500 26,100 27,500 13,900
Source:UNCOMTRADE,Frost&SullivanAnalysis

ExportsofQuicklimeandHydratedLime(Tonnes),India,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 27,000 63,000 9,000 17,000 26,000 25,000
HydratedLime 3,800 9,400 11,500 4,800 12,200 13,000
IndustryDynamics
GrowthDrivers
x EconomicOutlook:PositivemacroͲeconomicoutlook(realGDPgrowthat6.8%to8.1%from2016to2021,as
per IMF forecasts) could drive productionoutput of key end use segments where quicklime, hydrated lime,
andlimestoneareused.ProductionoutputincreaseislikelytodrivelimedemandinIndia.
x Increased Steel Production: The National Steel Policy in India targets total steel production at 110 million26
tonnes per year (2019Ͳ2020), with a growth of 5% from 2016 to 2020, which significantly spur demand for
quicklimeandlimestone.

26
http://srma.co.in/pdf/SRMAͲSteelͲnewsletterͲ16thͲIssue.pdf


x Flue Gas Treatment: According to the Energy Information Administration (EIA), India!s coalͲfired capacity is
currently186GW,andsupplies62%ofthecountry!selectricity.Thecountryisplanningtoincreaseanother62
GW through coalͲbased power plants, which would require quicklime, hydrated lime and limestone for flue
gasdesulfurization.Indiacurrentlycollectsabout75%ofitsmunicipalwaste,butonlytreats25%ofitwhile
therestgoestolandfills.ThenewMSWlegislationrequirelocalbodieswithover1Millionresidentstohave
dedicated waste processing and treatment facilities, and therefore, the need for efficient environment
managementsystemssettoincreaseovertheyears.
x WaterTreatment:Hydratedlimeisusedinpotablewatertreatmentplants,sewagewatertreatmentplants,
and industrial water treatment plants. The quantities used in these plants differ depending upon the water
quality.Frost&SullivanestimatesthelimeconsumptionnormperMLDtobebetween2tonnesand3tonnes
as the pace of urbanisation accelerates in India; the Census of India reported urbanisation levels increasing
from27.8%inthe2001to31.16%inthe2011Census.Thistrendisexpectedtodriveportablewaterdemand,
increasingtheusageofhydratedlimeinthissegment.
x SugarRefining:Quicklimeisusedforsugarcanejuiceclarification;itisalsousedtopurifysugarfromother
sources,suchasmapleorsorghum.AsrawsugarcanejuicehaslowpH,limeisaddedtoraiseitspHlevels.
AccordingtotheIndianSugarMillsAssociation,sugarconsumptioninIndiaisinproportiontoGDPgrowth,
likelyspurringquicklimedemandfrom2016Ͳ2021.
x GlassIndustry:Theincreasingadoptionofglassintheconstructionandautomobileindustriesaresettodrive
demand for the flat glass market in India; it is expected to record a CAGR of 6% from 2016Ͳ2021, fueling
demandforquicklimeandlimestoneduringthisperiod.
x Paper Industry: Rising literacy levels as a result of the Sarva Shiksha Abhiyan (Total Literacy Campaign)
programme and increasing use of documentation are generating demand for writing and printing paper;
estimatedat13milliontonnesby2021.Demandforwritingandprintingpaperisexpectedtoriseto20million
tonnes27,atanincreaseof53%by2020.GroundCalciumCarbonate(GCC)andPrecipitatedCalciumCarbonate
(PCC) a valueͲadded product of limestone, is used as filler materials in paper mills. An increase in paper
consumptionislikelytodrivedemandforGCC,PCCandlimestone.
x Paint Industry: According to the Indian Paint Association, the industry recorded a CAGR of 12.9% from FY28
2011 to 2012 to FY 2014 to 2015 in value terms. The Association forecasts growth in the decorative and
industrial paints segments in FY 2015 to 2016 to FY 2016 to 2021, due to growth in core sectors such as
infrastructure,realͲestate,andautomotive.GCC,aproductmanufacturedusinglimestone,isusedinpaintsas
afillermaterial.Theexpansionforecastinthepaintindustryislikelytodrivedemandforlimestonefrom2016
to2021.
x PlasticIndustry:BothGCCandPrecipitatedCalciumCarbonate(PCC)areusedasfillermaterialsintheplastic
industry across rigid PVC, flexible PVC, polyolefin films, reinforced polyolefin, engineering resins and
unsaturatedpolyesters.Frost&SullivanpredictsgrowthinIndia!splasticindustryat8%peryearfrom2016to
2021,stimulatingdemandforGCC,PCC,andlimestone.
x NonͲFerrousMetals:Indiaisthethirdlargestproducerofprimaryaluminium,withproductionrisingfrom1.7
million tonnes in 2011 to almost 2.8 million tonnes in 2016, spurring growing demand for quicklime at
aluminium smelters. Likewise, major expansions in other nonͲferrous metals such as copper and zinc also
supportingdemandforquicklimeandhydratedlime.InFebruary2017,HindalcoIndustries!BirlaCopperunit
announcedplanstosetupanewunittoexpanditsproductioncapacityofcontinuouscastcopperrod(CCR)
from244,000tonnesperannum(TPA)to4,84,000TPA.

27
http://www.businessͲstandard.com/article/markets/indiasͲpaperͲdemandͲtoͲriseͲ53Ͳby2020Ͳ114041800784_1.html
28
FYreferstofinancialyear(April1sttoMarch31st)


GrowthRestraints
x AvailabilityofReserves:AccordingtotheFederationofIndianChambersofCommerce&Industry(FICCI),the
limestone availability for sustainable development is not assured beyond 50 years, as only 8%29of the total
resourcesareclassifiedasreserves.Thiscouldlimitlocalproductioninthelongerterm.
x Government Regulatory Issues: The Indian mining industry is often mired in environmental and regulatory
policy constraints and land acquisition problems, adversely impacting exploration and production of
limestone.
TheGovernmentofIndiaMinistryofMines(MoM)overseestheentiremineralsandminingsectorinthecountry
encompassingthelegislation,administration,policyformulationofallminesandmineralsotherthancoal,natural
gasandpetroleum,butincludingoffshoreminerals.Stategovernmentsmanagethepolicyandlegislationrelating
tominormineralswhiletheMoMhandlespolicyandlegislationrelatingtomajorminerals.
All mineral legislations in the country conform to the provisions of the MMDR Act 1957. MoM, through its
GeologicalSurveyofIndia(GSI)office,facilitatesexploration,geologicalmappingandmineralresourceassessment
inthecountry.TheIndianBureauofMines(IBM),asubordinateofficeoftheMoM,ismainlyresponsibleforthe
regulationofminingactivitiesinthecountry.
Since there is an uncertainty of reserves beyond 50 years, the multiple regulatory policies could limit limestone
miningevenbeforedepletionofknownreserves.Thiscouldencouragethegrowthofimportstoensureadequate
supplyprimarilytothesteelindustry,whichiscentraltothecountry!seconomicgrowth.
QualitativeOverviewofCompetitiveLandscape
India!slimestoneindustryishighlyfragmented,consistingofmanymediumandsmallͲscaleparticipants.Quicklime
andhydratedlimeproductionisalsounorganizedinIndia.Limeindustryisopenfor100%FDIinthissectorcanbe
donebydirectroute(withouttheneedtowaitforanygovernmentpermission).Largeenduseindustriessuchas
cement,iron,andsteelhavecaptivemines,whilemostsmallͲscaleplayerscatertoaluminium,FGD,agriculture,
sugarͲmaking,petrochemicals, oil,glass, metallurgy andore, plastics,paper andpulp segments. Sigma Minerals,
Chemical & Minerals India, White N! White Minerals, and Garima Chemicals are key players in the downstream
quicklimeandhydratedlimemarket.RajasthanStateMinesandMineralsLtdisthelargestlimestoneproducerin
India.
In2016,about97%ofthetotallimestoneproductioninIndiawasofcementgrade,2%ofironandsteelgrade,and
theremaining1%consistingofthehighͲcalciumgrade.Rajasthanisthelargestproduceraccountingfor21%ofthe
totallimestoneproduction,followedbyMadhyaPradesh(13%),AndhraPradesh(12%),Gujarat(9%),Karnataka,
Telangana, Chhattisgarh and Tamil Nadu (8% each), Himachal Pradesh and Maharashtra (4% each) and the
remaining5%fromMeghalaya,Odisha,UttarPradesh,Jharkhand,Assam,Kerala,Bihar,andJammuandKashmir.

29
http://ficci.in/spdocument/20317/MiningͲIndustry.pdf


IndustryOutlookofQuicklime,HydratedLimeandLimestoneinIndia
Demandforquicklime,hydratedlime,andlimestoneinIndiaisexpectedtoremainrobustgivenitsstronglinkto
highͲgrowth industries such as construction, steel production, and cement manufacturing. Increasing steel
consumption from the heightened housing, infrastructure, commercial, and industrial construction activities
representstheprimaryfactordrivingdemandforlimestoneintheforecastperiod.
Thehighuseofquicklime,hydratedlimeandlimestoneintheproductionofsteel,pulpandpaper,sugarcane,and
chemicalstomanufacturemanyhighͲvaluedailyͲuseitemsisexpectedtooffersignificantopportunitiesforfuture
market growth. In addition, use of quicklime, hydrated lime and limestone as the principal raw material in
environmental mitigation processes such as water purification, soil amendments, and fertilisation is also
anticipatedtosupportdemandinthemarket.


BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINAUSTRALIA
CountryOverview
Australiahasdemonstratedstrongeconomicperformanceinthepastfewdecades,reflectingthecountry!sstrong
macroeconomic policies and structural reforms. The economy is currently rebalancing, while supported by
monetary, fiscal policies and currency depreciation. Australia!s economy recorded a real GDP growth of 2.5% in
2016; mainlydriven by government spending, LNG exports, growth in services, and residential investments. The
IMFforecastsrealGDPgrowthat3%from2017to2021,likelysupportedbyincreasinghouseholdconsumption,
governmentspending,residentialdwellinginvestmentgrowth,andprivatebusinessinvestments.
RealGDPGrowthRateandGDPValue,Australia(USDBillion),2011Ͳ2021F

RealGDPGrowth%

GDPUSD(Billion)

) ) ) ) )

Source:IMF,AustraliaBureauofStatistics(ABS),OECD,WorldEconomicOutlookReport,CompiledbyFrost&Sullivan
In2016,theservicessectorcontinuedtodominatetheeconomy,accountingfor62%ofGDP.Theminingsectoris
an important contributor, contributing 7% of GDP in 2016. Australia has extensive coal, iron ore, copper, gold,
naturalgas,anduraniumreserves. Limestonedemandhighlycorrelateswiththemining,metalsandagricultural
output of the country. The country!s GDP growth forecast and expansion in end use industries (mainly
mining/mineralprocessing,metals,andagriculture)arelikelytohaveapositiveimpactonthelimestoneindustry.
MarketOverview
Western Australia is the major supplier of quicklime accounting for nearly 65% of total supply. This supply is
predominantly consumed within Western Australia. Limited volumes are supplied to nearby regions in South
Australia and the Northern Territory as it is not economical to transport lime from Western Australia to other
regions. Quicklime from Queensland caters to mineral processing refineries and smelters such as alumina, gold,
copper, nickel and steel. Most of these quicklime and hydrated lime plants are located adjacent to mineral
processing facilities. The production of quicklime and limestone in Queensland depends on the agriculture,
constructionandmineralprocessingactivities.


Australian quicklime and hydrated lime production hasbeen steady at 2 million tonnes from 2014 to 2016. The
quicklime, hydrated lime and limestone markets in Australia were stable between 2011 and 2016 despite the
fluctuationsinthebuildingandconstructionindustry.AccordingtoFrost&Sullivananalysis,quicklime,hydrated
lime and limestone markets are forecasted to increase at a CAGR of 1.8% between 2016 and 2021. Mining and
metallurgy,andbuildingmaterialssegmentsareexpectedtoaccountforthehighestshareofquicklimedemand,
i.e., 38% and 35% respectively even in 2021. According to Frost & Sullivan analysis, water treatment segment
forecasted to increase at a CAGR of 5.7% between 2016 and 2021; industrial wastewater treatment, adverse
climaticconditionsandreducedfreshwatercontentfromsalineintrusionaretheprominentdriversforquicklime
andhydratedlime.
By region, Western Australia continuestodominatethequicklime andhydrated lime markets, followed by New
SouthWales(NSW)whichisanticipatedtogrowduringtheforecastedperiodwithsupportofaquaculture,mining
andrenewableenergysegments.

MarketSizeofQuicklimeinAustralia(Tonnes),2011Ͳ2021F

2,500
2,000
1,500
1,000 2,103 2,108 2,107 2,014 2,042 2,074 2,118 2,179

2,005 1,898 1,994
500
0
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F

Source:USGS,Frost&SullivanAnalysis,ForecastbyFrost&Sullivan


MarketSizeofHydratedLimeinAustralia(Tonnes),2011Ͳ2021F

160
140
120
100
80
136 141 146
60 124 128 132
106 107 109 110 113
40
20
0
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F


Currently, quicklime is produced from shell sand in Owen Anchorage mainly by Western Australian lime
manufacturers, and the quicklime thus produced appears in different color with low calcium oxide content,
compared to the quicklime produced from limestone. Few limestone quarries are located at Queensland
(Taragoola,GladstoneandBajool),andNewSouthWales(Molong,Canowindra,SouthofYass,Bathurst,northeast
ofCoomaandnorthofTamworth).
OverviewofImportandExportofQuicklimeandHydratedLimeinAustralia
QuicklimeimportregisteredaCAGRof26.9%,increasingfrom23,100tonnesin2011to76,000tonnesin2016.
Thailand,andMalaysiaareexportersofquicklimetoAustralia,accountingfor43%and27%respectivelyin2016.
HydratedlimepredominantlyexportedbyThailandaccountedto52%oftotalvolume,followedbyMalaysia(38%)
andChina(8%)in2016.
Limestoneimportdeclinedby38%whiledomesticsupplyincreasedby3.7%in2016ascomparedto2015.Japan
andThailandarekeyexportersoflimestone;Japanaccountedfor98%ofthetotallimestoneimportsin2016.
AustraliaexportsminimalvolumesoflimestoneandhydratedlimetothenearbycountriesofPapuaNewGuinea,
FrenchPolynesia,NewZealand,andNewCaledonia.
ImportsofQuicklimeandHydratedLime(Tonnes),Australia,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 23,100 26,900 41,750 45,700 66,200 76,000
HydratedLime 2,300 4,200 19,500 37,800 18,000 22,650
ExportsofQuicklimeandHydratedLime(Tonnes),Australia,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime Ͳ Ͳ 1,010 970 50 Ͳ
HydratedLime 1,000 1,500 1,700 1,430 1,410 1,500


IndustryDynamics
GrowthDrivers
x AluminaProduction:Thecountry!sminingindustryoutputislikelytodrivequicklimedemand.According
totheAustralianAluminumCouncil,thecountryisthesecondͲlargestaluminaproducerintheworld.The
aluminaindustryisexpectedtogrowby2.3%from2016to2021.Quicklimeisusedintherefiningprocess
ofalumina;thusgrowthinthealuminasegmentwouldincreasequicklimedemand.
x WaterTreatment:ThewatertreatmentindustryislikelytosustaindemandforhydratedlimeinAustralia.
Urbanisationandindustrialisationarekeyfactorsgeneratingwaterdemand;watertreatmentincitiesand
mining activities (after use in mineral processing) as well as for agriculture farm use is mandated by
environmentalauthorities.Hence,theuseofhydratedlimeinwatertreatmentfacilitiesissettoincrease
from2016to2021.
x Agriculture: Quicklime, Hydrated lime and Limestone are used in farming wheat, barley canola, cotton,
fruits,andnuts.Itisusedtocombatacidityandimprovesoilproductivity.Demandfromthissegmentis
likelytogrowby3%from2016to2021duetothedesiredincreaseinagricultureyieldandfarmoutput
levels.
x Sugar:AccordingtostatisticspublishedbytheAustralianSugarMillingCouncil(ASMC)30,sugarproduction
grew to 4.77 million tonnes in 2016, from 3.68 million tonnes in 2011. Australia is a major exporter of
sugar; the country exported 3.73 million tonnes in 2016. Frost & Sullivan expects sugar production to
growatanaverageof3%perannumfrom2016to2021,potentiallyspurringdemandforquicklimeand
hydratedlimeinthesugarrefiningsegment.
x PaperIndustry:TheAustralianpulpandpaperindustryisdiverse;productsmanufacturedincludepaper
forpackagingfoodstuffandpaperforprintingreadingmaterialsuchasnewspapersandmagazines.The
availability of pulpͲmaking fibre resources (e.g., hardwood and softwood) provides Australia!s paper
industrywithacompetitiveadvantageintheAsianregion.Duetothegrowthinpaperproduction,Frost&
SullivananticipatesariseindemandforquicklimeinthissegmentataCAGRof4%from2016to2021.
x Mining: The Minerals Council of Australia estimated gold mine production at 272 tonnes from 2014 to
2015, with Western Australia leading in both gold miningand refining.Mine output is forecast togrow
duetotheincreaseingoldpricesandjewellerydemandfromChinaandIndia.Quicklimeisusedinthe
goldrefiningprocess.AccordingtoFrost&Sullivanestimates,goldminingcontributestoapproximately
12%oftheoverallquicklimedemandinAustralia.
x GrowingRechargeableBatterySegment:ThelithiummineindustryisforecasttorecordaCAGRof10.3%
from2016to2020inWesternAustralia,requiringtheuseoflimestoneintherefiningprocess.Lithiumis
used in the manufacture of rechargeable batteries. Depleting oil reserves and stiffer environmental
regulationstocontrolCO2emissionsarelikelytostimulatethegrowthofelectricvehiclemanufacturing,
increasinglithiumconsumption.
x UraniumExtraction:TheuraniumIndustryisanticipatedtoexpandby4.8%globally31between2017and
2020.Limestoneisusedintheneutralizationprocess.RisinguraniumminingactivitiesinAustraliaislikely
tospurgrowthinlimestoneusage.
x RenewableEnergy:WastetoEnergysegment(WTE)isatanascentstageinAustralia;withthecontinuing
successofWTEplantsinWesternAustralia,thestateEnvironmentalProtectionAuthority(EPA)aremore
likely to progress project approvals in New South Wales and Victoria. It will increase the quicklime and
hydratedlimedemandforrenewableenergysegmentincomingyears.

30
http://asmc.com.au/industryͲoverview/statistics/
31
http://www.minerals.org.au/resources/uranium/uranium_nuclear_forecasts


x Rare Earth Elements: Australia is a notable supplier of rare earth elements. Dysprosium is used to
manufacturemagnetsusedinwindturbinesandelectricvehicles.TheWesternAustralianDepartmentof
Mines and Petroleum has approved pilot rare earth projects, likely driving demand for highͲquality
limestoneandquicklimefrom2018to2020whentheseprojectsstartcommercialproduction.
GrowthRestraints
x GlobalCommodityMarkets:Asthemajorityofthequicklimeandlimestonedemandarecomesfromthe
mining and metallurgy sector, any downturn in the global commodity markets would have a negative
impactinquicklimeandlimestonemarket.ThecontractioninChina!ssteelindustryhasadverselyaffected
variousminingͲorientedeconomies(includingAustralia)inthepastthreeyears;afurtherslumpinChina!s
steelindustrycouldleadtoasignificantslowdowninAustralia!sminingsector.
x GlobalOvercapacity:GlobalovercapacityandimportscontinuetoimpactgrowthintheAustraliansteel
industry. Frost & Sullivan anticipates crude steel production to remain subdued over the 2017 to 2021
period,potentiallyslowingquicklimeandlimestonedemand.
x UnfavourableLocationforExports:Thelocalsupplyofquicklime,hydratedlimeandlimestoneproducts
predominantlycaterstothedomesticmarket.Aslogisticscostissignificantlyhigher,exportvolumesare
unlikelytorecordsignificantgrowthfrom2017to2021.
RegulatoryIssuesandTrends32
The Australian government is generally supportive of foreign entities investing in mining tenements, with the
Foreign Investment Review Board (FIRB) in charge of perusing investment proposals. Australian states and
territories have their own legislations regulating mining exploration. Mining management is formulated by the
states in line with relevant environmental legislations to ensure the mining projects undertaken abide by the
stipulatedstandards.
Theseprocessestypicallyinvolvethefollowingthreestages:
x TheProposal,NoticeofIntentionorEnvironmentPlanorInitialAdviceStatementstage!Theminingentityor
developerprovidesdetailsoftheprojectanddescribespotentialenvironmentalimpacts
x Government Assessment stage ! Once received, the appropriate authority reviews the proposal and
deliberatesifanyenvironmentalassessmentisnecessarytoidentifyissuesthatrequireattention
x Government Approval stage ! Delivers the final verdict on the proposal, and whether an environmental
approvalcanbeissued
Generally,theStatesdeveloplegislationsandlawsgoverningminingactivities,however,sectionssuchastradeand
finance are handled and regulated by theCommonwealth (Australian Maritime Safety AuthorityAct, 1990). The
MiningActsandtheStateAgreementsapprovemininglicencesandleasestoentities.Generalpurposeleasesand
miscellaneouslicencesaregrantedforthepurposeofsupportinginfrastructureanderectionofequipmentrelated
tominingoperations.
Mining operations in Western Australia are subject to environmental protection regulations including the
EnvironmentalProtectionandBiodiversityConservationAct1999,theWesternAustralianMiningAct1978(WA),
andtheMiningRegulations1981(WA).

32
http://www.chamberslawyers.com/wpͲcontent/uploads/downloads/2013/10/060518ͲPresentationͲEng.pdf


In2016,approximately95%ofAustralianlimedemandwascateredtobydomesticmanufacturers.Leadinglime
producers include Adelaide Brighton Ltd, Cockburn Cement, Boral Ltd, and Sibelco Australia Ltd. The market is
largely segmented into East Coast and Western Australia. East Coast suppliers address the needs of end users
withinthesameregion.InWesternAustralia,CockburnCementistheprominentlimesupplier;whileChememan
Public Company Limited is key importer of quicklime and hydrated lime in this region, accounting about 42% of
totalimports.
From2011to2012,AustralianlimesuppliersinitiatedantiͲdumpingmeasuresthroughtheAustralianCustomsand
BorderProtectionService(ACBPS)whichlaunchedinvestigationsintotheallegeddumpingofquicklimeexported
fromThailand.Indeterminingnegligibleimpactonlocalsuppliersfromimports,nocustomsdutyiscurrentlylevied
forquicklimeimportsfromThailand.
IndustryOutlookofQuicklime,HydratedLime,andLimestoneinAustralia
Rapid urbanisation, as well as growing investments in infrastructure development and industrial applications, is
likelytostimulatethegrowthofthelimemarketfrom2017to2021.Theminingandmetallurgysegmentislikely
to lead demand, based on its significant contribution constituting 30% of the total market in 2016. That stated,
environmentalconcernsandregulationsrelatingtothedredgingofshellsandfromcoralareexpectedtorestrict
thesupplyofquicklimedomestically.Overthelongterm(2020Ͳ2030),Frost&Sullivanpredictsadeclineinlocal
supplylevels,potentiallypavingthewayforincreasedimportsfromThailand,Vietnam,andMalaysiabecauseof
thequalityofthequicklimeproducedfromshellsandislowerthanproducedfromthelimestone.
The imports of both quicklime and hydrated lime have steadily increased. Quicklime imports grew from 23,100
tonnes in 2011 to 76,000 tonnes in 2016; while hydrated lime imports increased from 2,300 tonnes in 2011 to
22,650 tonnes in 2016, and increase of 58% due to the growth of the water treatment industry supported by
industrialisationandurbanisation.


BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIMEANDLIMESTONEINVIETNAM
CountryOverview
The Vietnamese economy is projected to witness flat growth from 2017 to 2021. In 2016, expansions in
manufacturing, construction and a growing service sector, the economic growth in Vietnam was 6.2%. This was
supportedbyincreaseintouristarrivals,whichincreasedby26.0%,foreigninvestmentsandhighcreditgrowth.
FDIreachedUS$15.8billion,upby9percentfrom2015.33
RealGDPGrowthRateandGDPValue,Vietnam(USDBillion),2011Ͳ2021F

RealGDPGrowth%

GDPUSD(Billion)

) ) ) ) )

Source:IMF,OECD,WorldEconomicOutlookReport,CompiledbyFrost&Sullivan
With nearly 5,000 deposits with 60 different types of minerals, mining is the fourth biggest contributor34 to
Vietnam!s economy. Limestone is found in all areas of Vietnam, with total resources estimated at 120 million
tonnes~130milliontonnes.35LimestonereservesarelargelylocatedinThuyNguyen,ThanhLiem,HoanhBo,Tuyen
Hoa, Binh Long, Hon Quang, Kien Luong, Kien Luong, Nam Giang, and Dong Giang districts. Major end use
industriessuchascement,ironandsteel,aluminium,paperandchemicalsarealsolocatedinthesedistricts.
Theminingindustrycontributedabout8%totheVietnamGDPin2016.Keymineralsincludecoal,bauxite,rare
earthelements,tungsten,titanium,phosphate,andironͲore.However,thesectorpostedadeclineof4%inthe
same year weighed down by higher natural resources tax, continued weakness in international oil prices, and
ageingdomesticoilfields.Demandforlimestoneislargelyinfluencedbytheglobalsteelmarketaswellasgrowth
inagricultureandgovernmentinvestments.AccordingtotheWorldSteelAssociation,globalcrudesteeloutputis
likelytoremainflatduringtheforecastperiod,amidslumpeddemandinrealͲestateconstructionandshipbuilding,
andcontinuingeffortstoreduceexcesscapacitybycountriessuchasChina.36 SinceVietnamisamajorlimestone
exporter to steel producing nations such as China and India, any slowdown in the steel growth rate in these
countriescouldadverselyimpactitslimestoneindustry.

33
GeneralStatisticsOffice,Vietnam
34
http://www.businessinsider.in/AͲdarkͲshadowͲloomsͲoverͲaͲkeyͲpartͲofͲVietnamsͲeconomy/articleshow/57925398.cms
35
http://hethongphapluatvietnam.com/decisionͲnoͲ507ͲqdͲbxdͲdatedͲaprilͲ27Ͳ2015ͲapprovalͲforͲlimeͲindustryͲdevelopmentͲplanningͲtoͲ
2020ͲandͲaͲvisionͲtoͲ2030.html
36
https://www.worldsteel.org/en/dam/jcr:04d72319Ͳ4763Ͳ46eeͲacd9Ͳf56add3b5189/Short+Range+Outlook+2017Ͳ2018.pdf/


MarketOverview
Vietnam!s steel industry is increasing at 16% yͲoͲy, driven by growing domestic consumption indicating good
potentialforthequicklimeandlimestonemarkets.
Itisanetexporterofquicklimeandhydratedlime.Taiwan,India,SouthKorea,Indonesia,Bangladesh,Australia,
Singapore,Malaysia, and the Philippines are major export destinations. The country!s limestone consumption in
2016 reached2.7 million tonnes, while quicklime and hydrated lime consumption were estimated at 1.1 million
tonnesand39,000tonnes,respectively.In2016,mostofthedemandforlimestoneandquicklimecamefromthe
steel industry, followed by other sectors including aluminium, chemicals, autoclaved aerated concrete (AAC),
paperandpulp,agriculture,andsugarcane.
DemandforquicklimeinVietnamisestimatedat1.1milliontonnesin2016andlikelytorecordaCAGRof4.4%
from2017toreach1.3milliontonnesby2021.Therapidgrowthhasbeenduetoincreasedactivityinthesteel
industryaswellasrobustdemandfromaluminium,paper,aquaculture,agricultureandpaperindustries.Demand
forhydratedlimeinVietnamisexpectedtogrowfrom39,200tonnesin2016to47,600tonnesby2021,ataCAGR
of4.0%.
MarketSizeofQuicklimeinVietnam(Tonnes),2011Ͳ2021F

1600
1400
1200
1000
800
1,272 1,337
600 1,117 1,164 1,215
993 1,046 1,078
925 945 963
400
200
0
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F



MarketSizeofHydratedLimeinVietnam(Tonnes),2011Ͳ2021F

50
45
40
35
30
25 48
44 46
20 39 41 42
35 36 38
15 33 34
10
5
0
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F

Limestone deposits are widespread across the country; the quality of limestone deposits vary from the lower
quality limestone meant for the cement and construction industry and also the high quality grade calcium
carbonate meant for the industrial applications like steel, mining, chemicals, etc. The limestone needed for
quicklimeproductionismetdomesticallyandthecountryisakeyexporterofquicklimemainlytoChina,Indiaand
ASEANcountries.


IndustryDynamics
GrowthDrivers
x Growthinsteeloutput:AccordingtotheMinistryofIndustryandTrade,Vietnam!scrudesteeloutputin
2017isanticipatedtoincrease16.6%yͲoͲytoreach5.5milliontonnes,stimulatinghealthygrowthinthe
domesticquicklimemarket.
x Alumina Refineries: The Vietnam National Coal and Mineral Industries Group!s (VINACOMIN) Nhan Co
AluminaComplexbegancommercialoperationsinthefirstquarterof2017.Thealuminarefinerywithan
installedcapacityof300,000MTispoisedtoinducesubstantialdemandforquicklimefrom2017to2021.
x Agricultural Usage: With agriculture accounting for over 15% of Vietnam!s GDP, demand for pulverised
limestoneusedtoimprovesoilqualitybyreducingsoilacidity,remainshigh.AccordingtotheMinistryof
Agriculture and Rural Development, Vietnam!s agriculture sector targets a growth of 2.5% to 2.8% in
2017.37
x Aquaculture:TheDevelopingaSustainable,HighVolume,ExportͲFocusedMarineFishAquacultureSector
inVietnamstrategybytheVietnamSeaCultureAssociation,targetsmarineaquacultureexportstoreach
USD12billiontoUSD13billionby2020andUSD30billiontoUSD35billionby2030.Demandforlime,a
primary source of nutrients in fishing ponds, is expected to grow to meet the surge in the marine
aquaculturesector.38
x PulpandPaperSegment:Vietnamhasaforestareaof13.8millionha,equivalentto44%ofthecountry.
The forest industry contributes 1.7% to the country!s GDP of which the pulp and paper sector is a key
growtharea.Thepaperindustryisgrowingatbetween15%and17%39,supplying64%ofthedomestic
market.Thepromiseoffuturegrowthinthissectorisfavourablefortheriseindemandforlime.
GrowthRestraints
x Industrial Pollution Control: The Vietnamese government seeks to replace all polluting manualͲburning
lime kilns by 2020. The initiative is expected to have implications on the domestic limestone market.40
Frost & Sullivan predicts a dip in production levels, potentially curtailing the quicklime and limestone
exports.
x Limited Reserves: Although Vietnam has large limestone reserves, many of these areas have been
declaredWorldHeritagesitescurtailingquarryingandexplorationactivities.

37
http://www.worldbank.org/en/news/pressͲrelease/2016/09/27/transformingͲvietnamsͲagricultureͲsectorͲwillͲstimulateͲhigherͲgrowth
38
https://www.vietnambreakingnews.com/tag/namͲseaͲcultureͲassociation/
39
http://english.vov.vn/economy/paperͲindustryͲshowsͲimpressiveͲgrowthͲ256683.vov
http://
hethongphapluatvietnam.com/decisionͲnoͲ507ͲqdͲbxdͲdatedͲaprilͲ27Ͳ2015ͲapprovalͲforͲlimeͲindustryͲdevelopmentͲplanningͲtoͲ2020ͲandͲ
aͲvisionͲtoͲ2030.html
40
http://www.worldbank.org/en/news/pressͲrelease/2016/09/27/transformingͲvietnamsͲagricultureͲsectorͲwillͲstimulateͲhigherͲgrowth


OverviewofImportandExportofQuicklimeandHydratedLimeinVietnam
Growthinconstructionactivitiesandburgeoningsteelindustryissignificantlyincreasingquicklimeandhydrated
productionvolume,requiringnegligibleimportsofquicklimeandlimestone.Thesupplyanddemandofhydrated
limearerelativelylowinVietnam.
ImportofQuicklimeandHydratedLime(Tonnes),Vietnam,2011Ͳ2016
Product 2011 2012 2013 2014 2015 2016

Quicklime 10 390 460 250 980 2,050
HydratedLime 1,990 2,220 2,750 380 510 640
Source:UNCOMTRADE,Trademap.Frost&SullivanAnalysis
ExportofQuicklimeandHydratedLime(Tonnes),Vietnam,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 612,570 773,400 895,110 965,000 920,400 814,500
HydratedLime 30 0 50 80 2000 640
Source:UNCOMTRADE,Trademap.Frost&SullivanAnalysis
Mineral exploration and mining activities in Vietnam are governed by Government Decree No 158/2016/NDͲCP
(November 29, 2016), which details provisions of the Mineral Law related to mineral exploration, mining and
Mining rights fees. Under the Mineral Law, mining activities comprise exploration and mining which include
mineral processing. The mineral licencing authority is mostly under the purview of the Ministry of Natural
Resources and Environment (MONRE); provincial people!s committees only have the power to approve mineral
surveys andobtaining samples, mining licences forcommon construction materials andpeat,andscattered/low
reserve minerals as specified by the MONRE. The exploration and mining licences are auctioned except for
exemptionareasoutlinedbythestateonenergysecurityandnationalsecuritygrounds.Also,themineralregime
requiresthemininglicenceetopayaminingfeeupontheissuanceofamininglicenceaseitheraoneͲoffpayment
or annual instalment at the licencee!s choice. The mining fee is calculated on the basis of value, reserves and
qualityortypesofminerals,aswellasminingconditions.41
Due to the various restrictions being introduced to maintain ecological diversity and protect the environment,
Frost & Sullivan forecasts a slowdown in the growth rate of limestone production within a decade. Although
Vietnam is likely to sustain as a net exporter, quantities will reduce significantly due to the various mining and
pollutionlawsservingasakeyconstrainttotheindustry.
As per the guidelines (Number 09/2017/TTͲBXD dated 5th June 2017) published by Vietnam!s Ministry of
Construction, quicklime and hydrated lime are allowed to be manufactured on the basis of lime industry
developmentplan2020.ExportofquicklimeandhydratedlimefromVietnamisallowabletoproducersthathave
mineralexploitationpermitforquicklimeproduction.Theseexportersneedtosubmitacopyoftheirpermitwhile
exporting; this process restricts producers that operate without valid mineral exploitation permit. Usually
producers with manual kilns operate without permits and these guidelines are expected to reduce the export
quantitiesofquicklimeandhydratedlimefromVietnam.

41
http://vietnamnews.vn/economy/348325/newͲdecreeͲelaboratesͲmineralͲminingͲrules.html#3AmCwE5fruF2tKgD.97


According to the amendment given by Vietnam!s Ministry of Finance (circular number 130/2016/TTͲBTC) during
2016,thelimeproductcompaniesthatexportunprocessedorprocessedlimestone,quicklime,andhydratedlime
cannot credit for input VAT (Value Added Tax), which becomes a cost of exporters. This VAT is applied to both
limestoneexploitationandforfurtherprocessingofquarriedlimestonefromVietnam.Companiesthatindirectly
export(throughothercompaniesortheirsubsidiaries)arealsoliabletopaythisVAT.
This VAT impacts the export price competitiveness of lime product companies in Vietnam. On the other hand,
Chememan Public Company Limited is likely to have competitive advantage when exporting quicklime, and
hydratedlimefromThailandtoothercountries.ThisisduetonilVATlevyonexportandexportdutyinThailandͲ
this price difference in export markets is anticipated to drive the export volume growth of Chememan Public
CompanyLimitedduringthenext3years(2017Ͳ2019).
Thequicklime,hydratedlimeandlimestoneindustryinVietnamisfragmented,comprisingmanysmallͲscaleand
unorganisedplayers.ThequicklimeandhydratedlimemarketinVietnamisdominatedbyVietLime,Vinafco,Tho
HopJSC,NAMCO,NhatVietMinerals,DLHMinerals,NgheAnMineralJSC,PhaLeMineralsJSC,SaoVietCo,Cavico
Minerals,SunJSC,GimexBusinessJSC,HoangNhat,andDongDuong.
LargeplayerslikeVietLime,Vinafcoprimarilyservecement,aluminium,ironandsteel,sugarcane,paperandpulp
industries,whilesmallandmediumscaleplayerslikeCavicoMinerals,SunJSC,GimexBusinessJSCcatertothe,
agriculture,chemicals,AACandthermalpowerplants.
IndustryOutlookofQuicklime,HydratedLimeandLimestoneinVietnam
The quicklime market is projected to reach 1.3 million tonnes by 2021, driven by rising steel consumption and
production, where it is a key raw material. Future market growth will be driven by numerous applications of
quicklime and hydrated lime in multiple industries including steel, aluminium, chemicals, paper and pulp,
aquacultureandagriculture.
Withgrowingenforcementofstringentminingandenvironmentallaws,Frost&Sullivanestimatesquicklimeand
limestone production to gradually decline after a decade, leading to a decrease in exports to cater to the
requirementsoftheglobalsteelsectoraswellasotherenduseindustries.


BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINJAPAN
CountryOverview
Japan!seconomicgrowthcontinuestoexperiencetwochallenges!anageingpopulationandhugepublicdebtof
246%ofGDP(asat2016).42Despitefouryearsofeconomicstimulus,Japan!seconomyhasfallenby0.2%43inreal
GDPgrowthincomparisonto2015,mainlyduetotimidwagegrowthandslowingofexports.Theaverageheadline
inflation decreased to 0.3% in 2015 due to lower oil prices, continuing to 0.4% in 2016. The government is
implementing various stimulus measures to revive the economy and avoid deflation by pushing companies to
increaseinvestmentsathomeandraisingwagestoboostdemandforservicesandproducts.However,incomplete
policiesandadditionalfiscaldemandsupportin2017mayfurtherappreciatetheYenleadingtodeflationrisk.The
IMFforecastsJapan!sGDPgrowthatbetween0.7%and1%from2017to2021owingtofallingsavingsrateandflat
privateconsumption.44Exportsareprojectedtoreboundinthefuturewithanincreaseininternationaltrade.The
followingchartillustratesJapan!spast(2011!2016)andfuture(2017Ͳ2021)GDPgrowthoutlook.
RealGDPGrowthRateandGDPValue,Japan(USDBillion),2011Ͳ2021F

RealGDPGrowth%

GDPUSD(Billion)

) ) ) ) )


The services sector is a major component of Japan!s economy; comprising banking, insurance, retail,
transportation and telecommunications accounting for 71% of GDP. By 2020, Japan aims to double its services
sectorproductivitygrowth,whichinturn,couldboostGDPgrowthinthecountry.45IndustrialproductioninJapan
registeredahealthy3%46growthin2016,expectingtoincreaseatasteadyrateforthenextfiveyears.Anincrease
in the country!s industrial production has a positive correlation with demand for quicklime, hydrated lime and
limestone;basedonthismacroͲeconomicimpact,Frost&Sullivananticipatesgrowthinquicklime,hydratedlime
andlimestonedemand.

42
IMF,2017
43
IMF,WorldEconomicOutlookReport,April2017
44
OECD
45
http://www.oecd.org/corporate/FDIͲinͲFiguresͲAprilͲ2016.pdf
46
https://tradingeconomics.com/japan/industrialͲproduction


Mining and quarrying had a negligible contribution to the country!s GDP in 2016. According to the Ministry of
Economy, Trade and Industry (METI), limestone reserves in Japan are estimated at 40,000 million tonnes (as at
2016).47ThesereservesaremainlylocatedinKamiiso,Shiriya,Fujiwara,Kaohsiung,TsukumiandOkayamaareas.
ThemineralsectorinJapanisparticularlyledbytheironandsteelindustry.TheWorldSteelAssociationprojectsa
stable recovery in Japanese steel demand in the next five years due to the improving global economy, spurring
demandforquicklime,hydratedlimeandlimestone.
MarketOverview
JapanisselfͲsufficientmarketforquicklime,hydratedlimeandlimestoneovertheyears.In2016,Japanproduced
143milliontonnesoflimestone,ofwhich44%caterstocementmanufacturingwhile24%goestoroadandother
constructionͲrelatedapplications.Theremaining32%ofthelimestoneisusedtomanufacturequicklimeandalso
in various end use applications such as glass & bottle, agriculture and animal feeds. Quicklime demand is
consumed by steel, building materials and soil stabilization segments. Hydrated lime is mainly used in water
desalination,fluegastreatmentandchemicalindustry.
Quicklimeandhydratedlimedemandhasremainedflatfrom2011to2016.In2016,quicklimedemandwasabout
7.80milliontonnesandhydratedlimewasabout2.34milliontonnes.DemandforhighͲcalciumlimestonegrade
has grown at about 1.4% from 2011 to 2016. According to Frost & Sullivan forecasts, Japanese quicklime and
hydrated lime demand is anticipated to remain the same, continuing historical trends as quicklime demand is
majorly reliant on steel industry. According to Japan Iron and Steel Federation forecasts, steel industry is
anticipatedtorecordaCAGRof0.4%overthenextfiveyears48.WatertreatmentandfluegastreatmentinJapanis
anticipatedtogrowmoderately,andincreasethedemandforhydratedlimefrom2.34milliontonnesin2016to
2.40milliontonnesin2021.
MarketSizeofQuicklimeinJapan(Tonnes),2011Ͳ2021F
9,000
8,000
7,000
6,000
5,000
4,000 8,005 7,587 7,620 7,911 7,952 7,806 7,728 7,666 7,681 7,743 7,836
3,000
2,000
1,000
Ͳ
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F

Source:METI,USGS,ForecastbyFrost&Sullivan

47
Research&StatisticsDepartment,MinistryofEconomy,TradeandIndustry(METI),Japan
48
JapanIronandSteelFederation


MarketSizeofHydratedLimeinJapan(Tonnes),2011Ͳ2021F
3,000
2,500
2,000
1,500
2,394 2,275 2,286 2,378 2,389 2,345 2,319 2,305 2,347 2,370 2,404
1,000
500
Ͳ
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F

Source:METI,USGS,ForecastbyFrost&Sullivan

Although domestic limestone reserves exist to meet the demand from quicklime manufacturers, Japan imports
highqualitylimestonefromMalaysiaandVietnam.Japan'sannualrequirementforhighqualitylimestoneusedin
quicklimeproductionisestimatedtobeabout14milliontonnes.
OverviewofImportandExportofQuicklimeandHydratedLimeinJapan
Importsofquicklimeandhydratedlimehavebeenminimalovertheyears.Althoughtheproductionoflimestone
in Japan is sufficient to meet domestic demand, the country imported nearly 0.5 million tonnes of agricultural
gradelimestonefromMalaysiaandVietnamin2016.Ontheotherhand,Japanranksfourthintheglobalexport
marketsrepresenting7.3%49ofglobalexportsforlimestone,withanexportofnearly4.9milliontonnesin2016.
Major export countries for limestone products are China and South Korea, accounting for over 75% of Japan!s
overallexportsin2016.
ImportsofQuicklimeandHydratedLime(Tonnes),Japan,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 6,600 7,100 6,300 4,000 5,300 8,900
HydratedLime 579 754 565 641 404 283
Source:UNCOMTRADE,Trademap,Frost&SullivanAnalysis
ExportsofofQuicklimeandHydratedLime(Tonnes),Japan,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime Ͳ 1,400 4,900 3,500 3,600 3,000
HydratedLime 3,500 3,900 6,300 5,600 3,700 3,900
Source:UNCOMTRADE,Trademap,Frost&SullivanAnalysis

49
TrademapandUNCOMTRADE


IndustryDynamics
GrowthDrivers
x Steel:AccordingtotheJapanIronandSteelFederation(JISF),crudesteelproductionin2016was104million
tonnes,placingthecountryasthesecondlargestproducerofsteelglobally.Crudeproductiondeclinedfrom
110milliontonnesin2013,primarilyduetoacontractionindemandinJapanandglobalsteelovercapacity.
TheWorldSteelAssociationforecastsastablerecoveryinJapanesesteeldemandfrom2017to2021,driving
demandforquicklimeandlimestone.
x EmissionControl:InlinewiththeIntendedNationallyDeterminedContribution(INDC)andParisagreement,
Japanistakingstepstocutdownemissionsby80%by2050.50Thismoveisanticipatedtodrivedemandfor
quicklimeandhydratedlime,especiallyinthefluegasdesulphurizationsegment.
x Waste Water Treatment: Japan has one of the most efficient water conservation and reuse systems in the
world.Inwastewatertreatment,Japanhasahighrecyclingratio,growingfrom68%in2004to78%in2014,
andlikelyto80%by2017.Frost&Sullivananticipatesusageofhydratedlimeinthewaterandwastewater
treatmenttogrowatanaverageof2%peryearfrom2017to2021.
x Paper Industry: Statistics published by the Japan Paper Association position the country as the third largest
globalproducerofpaperandpaperboards.Theproductionofpaperandpaperboardsstoodaround14.83
milliontonnesand11.39milliontonnesrespectivelyin2015.Frost&Sullivanpredictstheindustrytogrowata
rateof2%perannumuntil2021positivelyimpactingthedemandforquicklimefrom2016to2021.
GrowthRestraints
x HighPublicDebt:Japan!seconomicgrowthishamperedbypublicdebtof246%ofGDP(asat2016),limiting
new investments in industrial sectors. This is likely to impact demand for quicklime, hydrated lime and
limestonefrom2017to2021.
The Agency for Natural Resources and Energy, under the Ministry of Economy, Trade and Industry (METI), is
responsible for formulating Japan!s mineral policies. Japan!s Mining Act has been reviewed periodically since its
inceptionin1950.In2012,thecountry!sMiningActwasrevisedtostrengthentheregulatorypowersoftheMETI
in terms of granting mining rights after reviewing the financial and technical capabilities of the applicants and
restrictionsonthemethodsofexploration.Thisgovernmentbodyisresponsibleforthefollowingactivities:
x Plananddraftpoliciesformanagementofallmineralresourcesinthecountry
x Enforceminerallegislation
x Recommendchangesandupdatestominerallegislation
x Conductgeologicalsurveysonmineralreserves
x Framegeologicalandmineralstandards

By 2010, the Japanese government had granted 8,179 exploration licences for mining areas, of which 1,558 or
about19%hadbeendevelopedtotheproductionstage.Aspertherevised2012amendment,mineralsaredefined
in two classes as specified and nonͲspecified minerals. Specified minerals are ones the government of Japan
designates as particularly important to the national economy such as natural gas and petroleum; all the other
mineralsareclassedundernonͲspecifiedminerals.ThoughthefirstͲtoͲfilesystemisapplicableinthisamendment,

50
https://www.iea.org/publications/freepublications/publication/EnergyPoliciesofIEACountriesJapan2016.pdf


theapplicantforbothtypesofmineralswillhavetodemonstratefinancialsolvencyandtechnicalcapabilitiesto
carryoutdevelopmentatasite.
Limestone is one of the biggest mineral resources in Japan with over 100 quarries, primarily located in Garo,
Kamiiso,Hakodate,Shiriya,Fujiwara,Kaohsiung,Tsukumi,andOkayamaareas.Calfine,KawaiͲLimeIndustryCoLtd,
YoshizawaLimeIndustryCoLtdandRockChemicalIndustriesarelargeproducersofquicklimeinJapan.However,
the Japanese quicklime and hydrated lime supply is dominated by small and mediumͲscale participants like
Ashidachi Lime Co Ltd, Hokkaido Calcification Chemical Co Ltd, Kozuki Lime Industry Co Ltd, Komagata Lime
Industry,OkadaLimeIndustry,andShimizuLimeIndustryCo.,Ltd.
IndustryOutlookofQuicklime,HydratedLimeandLimestoneinJapan
ThequicklimemarketinJapanisexpectedtoreach7.83milliontonnesby2021,growingataCAGRof0.1%over
the forecast period of 2017Ͳ21. Major factors influencing demand for quicklime, hydrated lime and limestone;
include growth in iron and steel production, environmental control measures, water treatment plants, and the
paperandpulpindustry.Thecountry!sfocusonreducingbaddebtsandincreasingindustrialproductionfrom2016
to2021isexpectedtocomplementdemandgrowthofquicklimeandhydratedlime.
Japancurrentlymeetsitsdomesticquicklimeandhydratedlimedemandwithlittlerelianceonimports.Withthe
various policies drafted to encourage domestic investment and encourage mining activity, Frost & Sullivan
anticipatesthecountrytoremainreasonablyselfͲsufficientwithadecliningimporttrendlikelytocontinue.


BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINSOUTHKOREA
CountryOverview
Since2015,SouthKorea!sregisteredarealGDPof2.8%,adeclineof0.5%over2014.Thedownturnismainlydue
to unfavourable demographic conditions, high export reliance, and labour market distortion. The 2010 global
financialcrisishaslargelyaffectedSouthKoreaasitsexportsaccountedfor60%ofthetotaldemand.Thepotential
growthalsodeclinedto2.8%in2015from6.4%in2010.ThecountryfacesstiffcompetitionespeciallyfromChina
and developed markets. The contraction in domestic consumption and slowdown in China adversely impacted
SouthKorea!seconomyin2015,halvingthecountry!sexports.Accountsurplusexpandeddrasticallyfrom1.6%in
2011to7.9%in2015,mirroringthefallinoilprices,weakdomesticdemand,andtransitorydemographicfactors.51

RealGDPGrowthRateandGDPValue,SouthKorea,2011Ͳ2021F

RealGDPGrowth%

GDPUS(Bn)

) ) ) ) )


In2016,theservicesectorcontributed60%totheoverallGDPofSouthKorea,primarilydrivenbymarketͲfriendly
government initiatives such as development incentives and tax rebates. However, the manufacturing sector
continued its decline, accounting for 38% of GDP in 2016, mainly due to fluctuating exports, sluggish domestic
consumptionandlowerinvestments.Crudesteelproduction,makingupover8.5%ofthemanufacturingsector,
also saw a decline from 69.6 million tonnes in 201552 to 68.5 million tonnes in 2016. Stable growth in the
automotive sector backed by robust activity in the construction industry is projected to drive demand for steel
from2017to2021.

51
OECD
52
KoreanIron&SteelAssociation


Miningandquarryingcontributed0.2%oftheGDPin2016;outputfromtheminingindustryisforecasttoremain
stable from 2017 to 2021. The country!s involvement in the mining sector is likely to materialise through
acquisitions,FDIinflows,andjointventureagreements.
MarketOverview
Frost & Sullivan estimates that quicklime and hydrated lime demand reached 3.5 million and 0.8 million tonnes
respectively in 2016, while chemicalͲgrade limestone demand was estimated at 15.64 million tonnes. The steel
sector accounted for the majority of the quicklime and limestone demand, alongside consumption from other
segmentssuchasagriculture,energy,andenvironment.
MarketSizeEstimatesandForecastsofQuicklime,HydratedLimeandLimestone
DemandforquicklimeinSouthKoreaisestimatedat3.5milliontonnesin2016,likelypostingaCAGRof1.9%to
reach3.8milliontonnesby2021.HydratedlimedemandisforecasttorecordaCAGRof1.7%from2016to2021.
HighͲcalcium limestone market in South Korea has remained stable over the five year period. It is forecast to
record a CAGR of 1.2% over the 2016 to 2021 period, growing from 15.6 million tonnes in 2016 to 16.5 million
tonnesby2021backedbyarecoveryintheconstructionandsteelindustries.

MarketSizeofQuicklimeinSouthKorea(Tonnes)2011Ͳ2021F
4,500
4,000
3,500
3,000
2,500
2,000 3,796 3,774 3,672 3,500 3,550 3,700 3,690 3,718 3,780 3,890
3,375
1,500
1,000
500
Ͳ
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F

Source:USGS,ForecastbyFrost&Sullivan


MarketSizeofHydratedLimeinSouthKorea(Tonnes)2011Ͳ2021F
1,000
900
800
700
600
500
936 872 870 883 901
400 810 816 867 850 860
800
300
200
100
Ͳ
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F


During 2016, South Korean quicklime producers require about 5 million tonnes of high quality limestone for
producingquicklime.TheyarelargelydependentonthelimestoneimportsfromJapan,China,Vietnam,andthe
Philippines.
OverviewofImportandExportofQuicklimeandHydratedLimeinSouthKorea
SouthKoreaisanetimporterofquicklimeandhighͲcalciumlimestone.Quicklimeandhydratedlimearemainly
importedfromVietnamandJapan.SouthKoreaexportedanegligiblequantityofquicklimeandhydratedlimeto
Indonesia and Chinese Taipei in 2016. Limestone imports occur from Japan (80%), China, Vietnam, and the
Philippines.

ImportsofofQuicklimeandHydratedLime(Tonnes),SouthKorea,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 129,000 121,200 98,000 65,000 56,000 45,600
HydratedLime 330 485 400 225 330 407
ExportsofofQuicklimeandHydratedLime(Tonnes),SouthKorea,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 3,000 2,100 16 7 61 9
HydratedLime 500 720 600 446 850 1,110


IndustryDynamics
GrowthDrivers
x Increased Steel Production: The World Steel Associationpredicts a recovery in South Korea!s steel industry;
steel production is likely to grow by 3% from 2016 to 2021 owing to market stability and expansion in the
automotive,shipbuilding,andconstructionsectors.Growthisexpectedtocomplementdemandforquicklime
andlimestoneoverthe2016to2021period.
x FlueGasDesulphurization(FGD):SouthKorea!senergyproductionisapproximately513billionKWh,with70%
coming from fossil fuels.53 CO2 emissions were estimated at 651 million tonnes in 2016. The South Korean
governmentisconstantlyworkingtoreduceairbornepollutants,mainlySOx,NOx,andCO2.UsageofFGDis
the most effective measure in controlling pollutants from steel plants, fossil fuel power plants, etc.,
stimulatingdemandforquicklime,hydratedlimeandlimestone.
x Paper Industry: According to the Korean Paper Industries Association, the paper market is estimated at 2
milliontonnesin2016,mainlyduetohigherpurchasesfromcorrugatedpaperandspecialtypaperproducers.
Thesectorisexpectedtogrowatasteady2%yͲoͲyfrom2016to2021owingtorisingdemandforpacking
materialsandspecialtypapers,spurringgrowthinthequicklimesegment.
x GlassIndustry:Growthintheautomotive,electronics,andconstructionsectorsaresettoincreasedemandfor
glass in South Korea. The automotive glass segment is likely to record a growth of 7% from 2016 to 2021,
therebyeffectingacorrespondingincreaseinquicklimedemand.

GrowthRestraints
x Heavy Reliance on Exports: In 2015, about 46% of South Korea!s GDP came from the export of goods and
services,54adependencethatmakesthecountryvulnerabletoeconomicinstabilitiesassociatedwithachange
inexportdestinations,competition,andotherglobalinfluencers.
TheMinistryofTrade,Industry,andEnergy(MOTIE),KoreaResourcesCorporation(KORES),andKoreaInstituteof
Geoscience and Mineral Resources (KIGAM) are responsible for implementing the country!s mineral laws and
policies.Thesegovernmentagenciesareresponsibleforthefollowing:
x MOTIE:Plansanddraftspoliciesformanagementofallmineralresourcesinthecountry
x KORES:Overseesthedomesticmineralindustry,conductsresearch,andprovidestechnicalassistancefor
theacquisitionanddevelopmentofoverseasmineralresources
x KIGAM:Conductsgeologicalsurveysonmineralreservesandframesgeologicalandmineralstandards

TheKoreaMiningActoutlinesbasicguidelinesforexplorationofthecountry!smineralresources.ThisActcovers
key areas such as licencing, terms of mining, and boundaries of the mining area. In 1967, the government
established the Korea Resources Corporation (KORES) to support the development of the domestic mineral
industry to conduct research and provide technical assistance for the acquisition and development of overseas
mineralresources.Currently,KOREShasforeigninvestmentsin32mineralprojectsin16countries.

53 https://www.worlddata.info/asia/southͲkorea/energyͲconsumption.php
54
http://thediplomat.com/2016/12/southͲkoreaͲisͲpoisedͲforͲeconomicͲdisaster/


In2007,thegovernmentestablisheditsFrameworkPlanfortheGrowthoftheDomesticMiningIndustry(2007Ͳ
2016). Under this framework, the government has numerous initiatives including a reͲevaluation of ores,
preventionofminedamage,andequipmentmodernisationtoimprovetheproductivityofactiveminesaswellas
developmentanddistributionofadvancedminingtechnology.
SouthKoreaisestimatedtopossess40billiontonnes55oflimestonethatcanbeusedforindustrialapplications
other than cement and construction. There are approximately 20 major limestone quarrying companies that
includeleadingparticipantssuchasSsangYongResourcesDevelopment,DaesungMiningDevelopment,Taeyoung
EMC Company, Damul Jeiho Corporation, and Tae Bong Mining Company. Other key companies supplying
quicklimeandhydratedlimeincludeJeongseonLimeCo,HanheungIndustrialCo,PoscoChemtechCo,HwaSung
ChemicalCo,andBaekkwangMineralProducts.Thesecompaniesmainlycatertothepaperandpulp,glass,FGD,
andcosmeticsindustries.
Jeongseon Lime Company is the leading supplier of quicklime and hydrated lime in the domestic market, while
HanheungIndustrialandHwaSungChemicalmainlyfocusonexportmarkets.Importsaccountedfor1.3%ofthe
overallquicklimerequirementin2016.
IndustryOutlookofQuicklime,HydratedLimeandLimestoneinSouthKorea
TheSouthKoreanhighͲcalciumlimestonemarketisexpectedtoreach16.59milliontonnesby2021,registeringa
CAGRof1.2%.Steadygrowthinautomotive,shipbuildingandconstructionsectorsarelikelytodrivedemandfor
quicklime,hydratedlimeandlimestone.Apartfromthesteelsectorexpectingtoboostdemand,othersegments
suchasglass,paper,pulpandcosmeticsareanticipatedtocomplementgrowth.

55
http://www.koreatimes.co.kr/www/news/tech/2016/11/129_6287.html


BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINCHINA
CountryOverview
Greater consumer spending and robust activity in the property market are key growth engines in the People!s
RepublicofChina!seconomy,posting6.7%yͲoͲygrowthin2016.TheChinesegovernmentcontinuedtoprovide
strong monetary and fiscal support to stimulate structural transformation and ensure economic, financial, and
socialstability.IncreasedgovernmentspendingoninfrastructureandrealͲestateprojectskeptgrowthinlinewith
theThirteenthFiveͲYearPlan2016Ͳ2020!stargetrangeof6.5%to7%.56
China is currently undergoing economic rebalancing, with a sharp slowdown in investment, weakening exports,
andexcesscapacityamongindustries.Hence,itseconomycoulddeceleratefrom6.7%in2016toanaverage6%
peryearoverthe2017to2021period.

RealGDPGrowthRateandGDPValue,China,(USDBillion),2011Ͳ2021F

RealGDPGrowth%

GDPUSD(Billion)

) ) ) ) )


AccordingtotheNationalBureauofStatistics(NBS),thecountry!sGDPtotalledaboutUSD11trillionin2016,with
the service sector accounting for 51.6% of the GDP. The total investment in fixedassets was USD8925 billion in
2016, up by 7.9% over the previous year. The mining sector!s fixed asset investments declined by 20% to reach
USD152billion.57Whiletheindustrialsectorവconstruction,manufacturing,andminingവaccountedfor39.8%of
GDP.
Chinaisboththeworld'slargestproducerandconsumerofquicklimeandhydratedlime.Limestoneisfoundinall
provinces,municipalities,andautonomousregionsexceptShanghaiandtotallimestoneresourcesareestimatedat

56
http://www.stats.gov.cn/english/pressrelease/201702/t20170228_1467503.html
57
http://www.stats.gov.cn/english/pressrelease/201702/t20170228_1467503.html


120billion~130billiontonnes.58 ReservesarelargelylocatedinShaanxi,Anhui,Guangxi,Shandong,Hebei,Henan
and Guangdong, Liaoning, and Jilin provinces. Most end use industries such as cement, iron and steel and
aluminiumarelocatedintheseprovinces.
Withtheeconomyexpectedtomoderatefurtherfrom2017to2021,demandforlimestonewilllargelyrelyupon
the steel market and government investments. According to the World Steel Association, crude steel output is
expectedtoremainflatovertheforecastperiod,amiddecliningdemandfrommajorenduseindustriessuchas
realͲestateconstructionandshipbuildingandcontinuinggovernmenteffortstoreduceexcesscapacity.59
MarketOverview
Quicklime and hydrated lime and limestone produced in China mainly cater to the domestic market. Export
quantities are lower when compared with the large volumes produced in China. Quicklime and hydrated lime
consumption were estimated at 119 million tonnes and 28 million tonnes respectively, while limestone
consumptionin2016reached285milliontonnes.Thesteelindustryaccountedforthelargestdemand(about40%)
inquicklimeandlimestone,followedbyindustriessuchasaluminium,oil,FGD,paperandpulp,agriculture,energy
andwatertreatmentplantsin2016.
Growth in the steel industry in the past has contributed to increase in quicklime demand to reach 119 million
tonnesin2016,registeringaCAGRof2.7%from2011.Futuregrowthforquicklimeisestimatedat0.4%yͲoͲyto
touch 121 million tonnes by 2021. Hydrated lime grew at around 3% in the last five years to reach 27.7 million
tonnesin2016.DemandforecastforhydratedlimeisexpectedtoregisteraCAGRof0.3%during2016Ͳ21toreach
28milliontonnes.
MarketSizeofQuicklimeinChina(Tonnes),2011Ͳ2021F
140,000
120,000
100,000
80,000
60,000 118,198 119,682 118,022 118,830 119,425 117,633 118,574 119,760 121,437
103,869 109,226
40,000
20,000
Ͳ
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F


58
MinistryofLandandResourcesPeople sRepublicofChina,ChinaMiningOrganisation
59
https://www.worldsteel.org/en/dam/jcr:04d72319Ͳ4763Ͳ46eeͲacd9Ͳf56add3b5189/Short+Range+Outlook+2017Ͳ2018.pdf/


MarketSizeofHydratedLimeinChina(Tonnes),2011Ͳ2021F
30,000
25,000
20,000
15,000 28,055 28,187

27,650 27,616 27,745 27,829 27,467 27,632 27,880
24,309 25,836
10,000
5,000
Ͳ
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F


Chinapossesseslimestonereservesandlimeproducerssourceitlocallytoproducequicklime.Limestonemarket
recordedaCAGRof2.9%from2011and2016,increasingfrom246milliontonnesin2011to285milliontonnesin
2016.TheChineselimestonemarketisexpectedtoreflectagrowthof0.2%overtheforecastperiodof2016to
2021,growingto287milliontonnesby2021.
OverviewofImportandExportofQuicklimeandHydratedLimeinChina
Indigenous suppliers account for most of the country!s quicklime, hydrated lime and limestone requirements.
LargesteelproducerslikeBaotouIron&Steel,LiangangFurnaceMaterialCo,MaanshanIron&Steel,HandanIron
&SteelGroup,TaiyuanIron&Steel,TangshanIronandSteelandShandongLaiwuSteelhavecaptivelimestone
quarriesandpossessquicklimeͲprocessingfacilities.
Chinaexported105,900tonnesofquicklime,76,500tonnesofhydratedlimeand825,000tonnesoflimestonein
2016.Forquicklime,PapuaNewGuinea,MongoliaandSouthKoreaarethemajorexportdestinations,accounting
for78%ofoverallexports.HydratedlimeexportstoHongKongaccountedfor73%ofoverallexports.Majorexport
destinationsforlimestonewereHongKongandSouthKorea,accountingforover97%ofoverallexports.

ImportsofQuicklimeandHydratedLime(Tonnes),China,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 10,200 17,600 46,600 17,000 800 1,300
HydratedLime 1,000 1,300 1,900 2,500 2,400 3,100
ExportsofQuicklimeandHydratedLime(Tonnes),China,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 123,900 94,000 64,200 85,900 114,000 105,900
HydratedLime 69,800 79,700 79,500 98,800 67,500 76,500


IndustryDynamics
GrowthDrivers
x Sustainedeconomicgrowth:TheIMFprojectsapositiveeconomicoutlook,withrealGDPforecasttosustain
growthlevelsat6%from2016to2021.Muchofthisgrowthislikelytobeledbyincreasedproductionacross
major sectors such as agriculture and manufacturing, driving demand for quicklime, hydrated lime and
limestoneoverthesameperiod.
x FlueGasTreatment:AccordingtotheNationalEnergyAdministration,China!scoalpowergenerationcapacity
isforecasttogrowbyasmuchas19%from2017to2021.Thecountryplanstoincreaseanother1,250GW
capacitythroughcoalͲbasedpowerplants,increasingrequirementsofquicklimeforfluegasdesulfurization.60
x Aluminium:TheInternationalAluminiumInstitutepredictsanincreaseinChineseprimaryaluminiumoutput
between7%and9%in2017,from3.7%in2016.WithChinaaccountingfornearlyhalftheworld!saluminium
production,anyincreaseinproductioncouldspurdemandforquicklime.Alongwithotherrawmaterialssuch
as bauxite, caustic soda, on an average, 40kg of quicklime is used in a smelter to produce one tonne of
aluminium.61
x SugarRefining:Quicklimeisusedforsugarcanejuiceclarification;itisalsousedtopurifysugarfromother
sources,suchasmapleorsorghum.AsrawsugarcanejuicehaslowpH,limeisaddedtoraiseitspHlevels.
AccordingtotheChinaMinistryofAgriculture,totalsugarproductioninMY2017/18isforecasttoriseby1
milliontonnesfromMY2016/17,ashighsugarpricesmotivatefarmerstoplantmoresugarcaneandsugar
beets,increasingquicklimedemand.
x Animal Waste Treatment: Quicklime is increasingly being used for animal waste treatment in China as it is
costͲeffectiveandhelpstoreduceodoursandmaintainpHlevels.
x Growth in construction: Increase in real estate and infrastructural construction is increasing hydrated lime
demandusedinsoiltreatment.Withhydratedlimeusedtodrywetsoilandprovidestabilityanddurabilityof
clayinthesoil,timeandmoneyonconstructionprojectsaresaved.Also,hydratedlimeisusedtoimprovethe
durabilityofasphalt.Theadditionof1%to1.5%ofhydratedlimetohotmixedasphaltincreasesitstoughness,
leadstoanincreaseinlifespanofaround25%.
GrowthRestraints
x SteelCapacityReduction:Aspartofitsmeasurestocurbexcessindustrialcapacities,theChinesegovernment
istighteningitsgriponstateͲrunsteelcompaniesbyscalingdowntheiroperations.Withsteelproductionin
thecountryexpectedtodecline2%by2018,demandforlimestoneandquicklimeisalsolikelytotakeadipin
theshortͲterm.
x Government Regulatory Issues: According to the Ministry of Environmental Protection of China, the mining
sectorplayedacrucialroleinrapideconomicexpansioninthelastthreedecades.Howeverpoorregulation
andweakimplementationofstandardshaspollutedmuchofthecountry'ssoilandleftpartsofitslandand
water supplies unfit for use. Hence it is expected that mining companies may face pressure from the
government authorities curbing upstream and downstream mining activities, and thus impacting the
limestoneavailability.

60
https://www.bloomberg.com/news/articles/2016Ͳ11Ͳ07/chinaͲcoalͲpowerͲgenerationͲcapacityͲmayͲriseͲ19ͲinͲ5ͲyearͲplan
61
InternationalAluminiumInstitute


StateͲownedenterprisesownandregulateminingactivitiesasstipulatedbythegovernment.TheMinistryofLand
and Resources is responsible for the planning, administration, protection and rational utilisation of mineral
resources.
The China Mining Association (CMA) serves the mining corporations and the government ! promoting the
development of the mining industry, following the internal laws and development processes of the mining
industry,andactingasaliaisonbetweentheminingindustryandthegovernment.ThroughtheChinaNonͲmetallic
Minerals Industry Association!s (CNMIA), the Calcium Carbonate Special Committee oversees the domestic
limestonemarketandimplementsgovernmentpolicies,lawsandregulations.
Inthesecondhalfof2016,theMinistryofLandandResourcesannouncedproposedchangestoitsmineraldeposit
classificationandreportingrulestobringtheminlinewithinternationalstandardsandopenupitsminingsector.
DifferencesinclassificationandreportingstandardshaveledtohighercostsforChina!sminingcompaniesinthe
globalmarkets.AdheringtotheCommitteeforMineralReservesInternationalReportingStandards(CRIRSCO)is
expectedtoboostChina'sminingindustryandincreaseitsinfluenceintheinternationalmarket.
Aspartofitseffortstocurbminingpollution,theMinistryofEnvironmentalProtection(MEP)in2016draftednew
rulestoraiseenvironmentalstandards.Accordingtodraftrules,quarrieswillhavetotreatmorethan85%oftheir
wastewater,andputsystemsinplacetoachievethecomprehensiveutilizationoftailingsandothersolidwaste.
Companieshavetoproactivelyimplementmeasurestoremediatethelandandminimiseemissionswhilemines
areinoperation,ratherthantreatsoilandwaterafteritiscontaminated.Miningfirmsalsoneedtoimplement
measurestoprotectorevenrelocatevaluableecosystems.Thenewrulescovermetalssuchastin,copper,lead
andrareearth,aswellasmineralslikecalciumcarbonate.
China!s quicklime and hydrated lime industry is very fragmented, comprising many smallͲscale and unorganized
players.Quicklimeprocessingfacilitiesarecaptivelyheldbylargeendusersintheironandsteelindustry.Small
scale players cater to FGD, agriculture, sugarcane, paper and pulp, aluminium, petrochemicals, oil, glass,
metallurgyandore,andplasticssegments.
LargeͲscalequicklimeandhydratedlimecompaniesarerelativelyfewinnumberandmoreprominent.Duetotheir
competitive cost positioning and consistent product quality, they are less sensitive to market dynamics and
supported by a continuous order flow from downstream users. One such producer is Shandong CITIC Calcium
IndustryCoLtd.SmallercompanieslikeQingzhouYuxinCalciumIndustryCoLtd,incontrast,arenumerouswith
smallsupplyvolumes,andaresensitivetomarketvariations.
IndustryOutlookofQuicklime,HydratedLimeandLimestoneinChina
The quicklime and hydrated lime demand is expected to remain flat over the forecast period. With excess
productioncapacitycreatedinthesteelindustry,theChinesegovernmentisscalingdowntheoperationsofsome
existingsteelmillsandcancellingfewplannedinvestments.Reductioninthesteeloutputcouldimpactdemandfor
quicklimeandlimestone.Themarketgrowthremainspositiveduetodemandfromfluegastreatment,aluminium,
sugar making, water and waste treatment segments continuing to create opportunities over the 2016 to 2021
forecastperiod.


BRIEFOVERVIEWOFQUICKLIME,HYDRATEDLIME,ANDLIMESTONEINTAIWAN
CountryOverview
Followingtheeconomicslumpof2015,Taiwan!seconomyhassincereboundedtoachievearealGDPgrowthrate
of1.4%in2016,onthebackofstrongexportdemandforelectronicproductsandcomponents.TheIMFforecasts
Taiwan!s real GDP growth at between 1.7% and 2.5% from 2017 to 2021, driven largely by improving macroͲ
economicoutlookduetoanincreaseintheexportvalueofelectronicproductsandautoparts.DatabyTaiwan!s
NationalDevelopmentCouncil62indicatedUSD31billionworthofelectronicproductexportsin2015,ofthetotal
exportvalueestimatedatUSD285billion.ExportofautopartsfromTaiwangrewfromUSD10.3billionin2013to
USD11.7billionin2015.ThefollowingchartillustratesTaiwan!spast(2011Ͳ2016)andprojected(2017Ͳ2021)GDP
growth.
RealGDPGrowthRateandGDPValue,Taiwan(USDBillion),2011Ͳ2021F

RealGDPGrowth%

GDPUSD(Billion)

) ) ) ) )

TheservicessectorisamajorcontributortoTaiwan!seconomycomprisingretailandwholesaletrade,realͲestate,
andpublicadministration,andcontributingapproximately60.0%ofthetotalGDPin2016.Miningandquarrying
sectorshadarelativelylowercontributiontothecountry!seconomyin2016,atonly0.01%ofthetotalGDP.The
shareoftheminingandquarryingsectortoGDPregisteredayͲoͲyreductionof3%from2011to2016.According
to the Ministry of Economic Affairs (MOEA), limestone reserves in Taiwan are estimated at almost 326 million
tonnes as at January 2016. These reserves are mainly located in Yilan, Hualien, Taitung, Kaohsiung, Tainan, and
Hsinchu counties. Considering the environmental impact of limestone mining such as relocation and welfare of
localcommunities,wastedischargefacilities,andpotentialdepletionofresources,MOEAgrantsminingleasesto
veryfewcementcompaniesthatproducelimestoneforcaptiveusageamountingtobetween300,000tonnesand
350,000tonnes,annually.TaiwanisanimportͲdependentcountryforlimestonetosupportitsironandsteel,nonͲ
ferrousmetals,anddownstreamlimeindustries.

62
http://www.ndc.gov.tw/en/


Expansionoftheironandsteelindustry,whichaccountsformorethan5%ofTaiwan!soverallexports,isrelatedto
theeconomicdevelopmentofthecountry.Taiwan!seconomyprojectedtoseearealGDPgrowthof1.7%to2.5%
between2017and2021.Likewise,theironandsteelindustryinTaiwanisexpectedtoregisteragrowthof2%per
yearfrom2016to2021,providinggreaterimpetusforthemineralindustryincludinglimestone,whichisakeyraw
materialforsteelproduction.
MarketOverview
Amidlimiteddownstreamfacilitiesforquicklimeproduction,Taiwanisanetimporterofquicklime.For2016,Frost
& Sullivan estimates Taiwan!s quicklime and hydrated lime consumption at 554,700 tonnes and 24,700 tonnes
respectively. The steel sector accounts for 80% of the quicklime demand. China Steel Corporation (CSC) is the
largestenduserofquicklimeinTaiwan.Aluminium,wastewatertreatment,andagriculturecontinuedtobethe
majorendusesegmentsforquicklimeandhydratedlimein2016andovertheforecastperiod(2016Ͳ2021).
ThequicklimemarketregisteredaCAGRof1.0%between2011and2016,growingfrom528,800tonnesin2011to
554,700 tonnes in 2016. Moderate growth was attributed to the steel industry as well as an improvement in
overalleconomicconditions,andhigherprivatesectorconsumption.ThequicklimemarketinTaiwanisforecastto
recordaCAGRof2.5%from2016Ͳ2021,growingfrom554,700tonnesin2016toabout626,300tonnesby2021.
Demandforhydratedlimeisexpectedtogrowfromanestimated24,700tonnesin2016to29,700tonnesby2021,
ataCAGRof2.2%.
MarketSizeofQuicklimeinTaiwan(Tonnes)2011Ͳ2021F
700
600
500
400
300 603 595 589 606 626

533 578 555 564 575
529
200
100
0
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F

Source:MOEA,USGS,ForecastbyFrost&Sullivan


MarketSizeofHydratedLimeinTaiwan(Tonnes)2011Ͳ2021F
35
30
25
20
15 28 28 29 30
27 27 27 28
25 24 25
10
0
2011 2012 2013 2014 2015 2016E 2017F 2018F 2019F 2020F 2021F

Source:MOEA,USGS,ForecastbyFrost&Sullivan

Amidlackofdomestichighqualitylimestonereserves,quicklimeandhydratedproducersinTaiwanarefullyreliant
onlimestoneimportsfortheirrawmaterialrequirements.Steelmanufactureswithcaptivequicklimeprocessing
facilities, source limestone mainly from Japan, Philippines and Malaysia; while indigenous quicklime producers
source high quality limestone from Thailand and Vietnam. During 2016, domestic quicklime producers import
around250,000MTofhighqualitylimestoneforproducingquicklime.
OverviewofImportandExportofQuicklimeandHydratedLimeinTaiwan
Taiwanisanetimporterofquicklimein2016.MajorexporterswereJapan,Vietnam,thePhilippines,Thailand,and
China.Relianceonimportsislikelytoremainintheforecastperiod,giventheincreasingdemandforquicklimeand
limestone,mainlyfromthesteelsector.Importvolumeforhydratedlimeisrelativelylow,duetolocalproduction
capabilities.Thetablebelowprovidesimportandexportvolumesofquicklime,andhydratedlimefrom2011to
2016.
ImportsofQuicklimeandHydratedLime(Tonnes),Taiwan,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 447,400 440,800 461,700 499,100 450,100 428,100
HydratedLime 332 323 749 632 582 641

ExportsofQuicklimeandHydratedLime(Tonnes),Taiwan,2011Ͳ2016

Product 2011 2012 2013 2014 2015 2016
Quicklime 400 200 500 400 500 400
HydratedLime 400 200 300 300 500 300


IndustryDynamics
GrowthDrivers
x Steel:CrudesteelproductioninTaiwanregisteredaCAGRof1.4%from2011to2016,andisexpectedto
maintainthisgrowthovertheforecastperiod.
x Petrochemicals:Taiwan!sleadingpetroleumcompany,CPCCorporation,islikelytoinvestUSD7billionin
hydrocarbonprojectsincludingpetrochemicalsfrom2017to2024.Theinvestmentscouldgenerategreater
opportunitiesforquicklimeandhydratedlimeinthechemicalssectorovertheforecastperiod.
x Agriculture: Frost & Sullivan anticipates positive growth in the use of crushed limestone in agricultural
applications(asasoilamendment)at2%peryearfrom2016to2021.
GrowthRestraints
x Imports:Quicklimeandhydratedlimeproducersarereliantonlimestoneimports,amidalackofdomestic
reserves. Hence, availability of alternative materials such as dolomite and gypsum could restrict the
attractiveness of limestone in certain end use segments such as agriculture, animal feed, waste water
treatment.
MiningactivityinTaiwanisregulatedbytheDepartmentofMinesoftheMinistryofEconomicAffairs.Beinganet
importerwithlimitedmineralsreserves,thereisminimalgovernmentinfluenceontheindustry.
Current functions of the Department of Mines include promoting and conserving mineral resources by way of
examinationofmines,geologicalstudies,inspectionandapprovalofminingplansandminingschemes,conducting
environmental studies and related activities, promoting technologies for the upgradation of lowͲgrade ores and
identifying avenues for their utilisation. Other tasks cover the preparation of feasibility reports for mining and
beneficiation projects, preparation of minerals maps and National Mineral Inventory of minerals resources,
providingtechnicalconsultancyservicestothemineralindustry,functioningasadatabankforminesandminerals,
and preparing technical and statistical publications. In 2017, the nation!s Legislative Yuan is considering
amendmentstotheMiningAct,witheightversionsproposedbylegislativecommittees,inadditiontoaversion
proposedbytheCabinet.63
Domestic manufacturers dominate hydrated lime supply; Ho Hsing Lime Factory and Kung Jung Lime Works are
majorsuppliers.Quicklime,ontheotherhand,issuppliedbybothdomesticandinternationalproducers;Formosa
PlasticsCorporation,HoHsingLimeFactory,andKungJungLimeWorksarekeysuppliers.However,theTaiwanese
limestonemarketisfullyreliantonimports,asthecountrydoesnothaveindigenouslimestonequarries.
IndustryOutlookofQuicklime,HydratedLimeandLimestoneinTaiwan
Rising steel consumption driven by increasing construction activities in housing, infrastructure, commercial and
industrialarekeyareasstimulatingdemandforquicklime,hydratedlimeandlimestonefrom2017to2021.Future
growthinthemarketwillbedrivenbynumerousapplicationsofgroundcalciumcarbonate,precipitatedcalcium
carbonate,quicklime,andhydratedlimeinindustriessuchassteel,manufacturing,watertreatment,sewageand
effluenttreatment,sodaashandchemicals.

63
http://www.mine.gov.tw/moea/


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H2O CO2 PrecipitatedCalcium

Properties Quicklime HydratedLime

SpecificGravity(g/cc) 3.2Ͳ3.4 2.3Ͳ2.4

BulkDensitykg/cu.m 881Ͳ961 400Ͳ560

AngleofRepose 55° 70°

SegmentandSubͲSegment Quicklime HydratedLime Limestone

Product EndUseSegment TypicalConsumptionNorm

Quicklime Pulp 8Ͳ15kgofquicklimerequiredfor1tonneofpulpproduction

Limestone Primary Secondary

2011 2016 2021F

*'3 86'%Q 5HDO*'3JURZWK

1,000 2,103 2,108 2,107 2,014 2,042 2,074 2,118 2,179

Product 2011 2012 2013 2014 2015 2016

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