Displaying items by tag: GCW91

If you have any spare cement this week – send it to Ghana!

First, HeidelbergCement announced plans for a new cement mill on the coast at Takoradi. Then, Dangote officially started to export cement to the west African nation.

HeidelbergCement's strategy in the region is telling because it is starting to head inland. The press release on Ghana indicated that the German-based cement producer intends to expand its capacity to 4.4Mt/yr by late 2014. This follows a recent announcement that HeidelbergCement are building their first grinding plant in Burkina Faso, directly north of Ghana. Previously the producer imported cement there. Now it intends to build a US$50m plant with a production capacity of 0.65Mt/yr.

Since most of HeidelbergCement's existing infrastructure in the region is based on the coast, building a plant in a landlocked nation - Burkina Faso - is a huge vote of investor confidence in west Africa. "In particular the countries of sub-Saharan Africa have a very high growth potential due to their early stage of industrialisation and rich natural resources," said Dr Bernd Scheifele, chairman of the managing board of HeidelbergCement in the statement accompanying the Ghana expansion.

The move also provides a clue as to how competitive the cement market is becoming in territories near the coast in Africa. Currently HeidelbergCement holds a mostly coastal presence in western Africa, in Benin, Democratic Republic of the Congo, Gabon, Ghana, Liberia, Sierra Leone and Togo. It has four cement plants and nine grinding plants. Its cement business made a year-on-year increase in revenue of 12% to Euro612m in 2012.

Roughly calculated, HeidelbergCement is paying US$77/t in Burkina Faso compared to US$38/t in Ghana to build its new production capacity. HeidelbergCement must be paying double for a reason.

Meanwhile, Dangote Cement announced on the same day (11 March 2013) that a fleet of cement trucks were heading to Ghana. Already the Nigerian cement producer holds a cement terminal with a bagging capacity of 1.5Mt/yr in the country. Dangote intends to start exporting 5000t/week of cement. Its eventual target is 5000t/day when the logistics are in place, or up to 1.8Mt/yr. Not a bad start in unloading Dangote's self-declared overcapacity of 20Mt/yr in Nigeria upon the neighbouring nations in the Economic Community of West African States (ECOWAS).

Ethiopia: Tamiru Wondimagegn has been appointed as board chairman of Habesha Cement. He is a prominent lawyer and board member of Habesha Cement. He succeeds Gizaw Teklemariam, who previously worked in the oldest state owned cement factory, Mugher.

Habesha held elections for its board in late January 2013, following a reduction in board places from 12 to nine. The Ethiopian cement producer has also given three board of directors seats to two South African companies, International Development Corporation and Pretoria Portland Cement, which are credited for bringing in 49% equity to Habesha.