South Africa’s major
cement producers
are calling on the
department of trade
and industry (dti) to protect
the local industry and to
institute anti-dumping
duties for cement imports,
particularly those from
China, Pakistan and India.
That’s according to
industry sources who
say there is already an
oversupply of local cement.
“And now we have to
compete with cheaper
products from the Far East,”
said one local producer.
Market researchers Frost
& Sullivan, in their study
‘Southern African Cement
Industry Production and
Investment Forecasts’,
predict that US$940 million
will be invested in the
cement industries of three
countries – South Africa,
Zambia and Zimbabwe –
between 2013 and 2018.
According to their figures,
cement production stood at
14.9 million tonnes in 2012
and is expected to reach
18.1 million tonnes in 2018
– owing to the addition of
new cement manufacturing
plants in South Africa,
Zambia and Zimbabwe. “By
2018, these projects will
increase cement production
capacity by another 5.1
million tonnes,” the report
states.
In early 2014, another
local competitor will enter
the market when Nigerianowned
Dangote Cement
opens in Aganang in the
North West province, adding
1.5 million metric tonnes
to South Africa’s capacity,
according to a statement
from the Dangote group.
“The ships from the
Far East flood the market
with a cheaper – and some
say inferior – product and
the local producers are
forced to find alternative
markets outside of South
Africa’s borders to get rid
of excess stock,” a cement
manufacturer told FTW.
Cement is exported to
other African countries at
discounted prices, he added.
“Three quarters of the price
is the high transport costs
which escalate cross-border
due to border delays and
poor infrastructure,” he
said.
Many in the local
construction industry –
one of the biggest markets
for cement and aggregate
products
– will not
use imported
cement products,
even though they carry
the South African Bureau
of Standards (SABS) stamp
of approval because they
believe it is an inferior
product, according to our
source. “But a lot of the
other industries that
use cement do not rely on
such a delicate and accurate
mixture and are therefore
happy to use the cheaper
product,” he said.
“In
order to
diversify and survive the
overcapacity challenge in
South Africa, some cement
producers are exploring
the option of expanding
operations further into
Africa, particularly sub-
Saharan Africa, including
east and west Africa.”
In October this year,
Ketso Gordhan, chief
executive of PPC Cement,
announced the company’s
intentions
to invest
in a US$230
million factory in the
Democratic Republic of
Congo (DRC). The Business
Report also recently
reported Afrisam chief
executive officer Stephan
Olivier as saying that the
company planned to expand
in the rest of Africa after
overhauling its debt.
CAPTION
Cement workers at a manufacturing plant in the North West province ... cheap imports
threating sustainability.
