Displaying items by tag: Investment

India: The Adani Group will invest US$577m to develop and expand its cement plants in Bhatapara and Jamul, according to the Economic Times. The expansion at the Bhatapara unit has already been announced.

This comes as part of an announcement by chair Gautam Adani to invest a total of US$7bn in the state, with US$6.9bn going to the expansion of power plants in Raipur, Korba and Raigarh.

Afghanistan: The office of the deputy prime minister for economic affairs says that the country has invested over US$600m in the cement sector since the Taliban administration took charge in 2021. It cited a US$1m renovation project at the Jabal Saraj cement plant in Parwan province, according to National Afghanistan TV and the BBC. Future investment projects are also planned for Jabal Saraj as well as the Temtaq plant in Jowzjan province and the Herat cement factory in Herat province.

At present the local cement sector has a reported production capacity of 5Mt/yr.

Portugal: Cimpor plans to invest €1.4bn in its Portuguese cement assets by 2030, focusing on infrastructure, technology and new products to address decarbonisation, described as the ‘number one challenge’ by CEO Cevat Mert, according to Noticias Financieras news.

In October 2024, Cimpor announced an investment of €360m in decarbonisation and innovation projects by 2026, including €180m allocated to its Alhandra plant in Lisbon. The company also aims to expand into more markets beyond the 14 it currently serves. It has invested €50m in a terminal at the port of Bristol in the UK, and has plans for France and the US. Ignacio Gomez, Cimpor’s commercial manager, cited this shift towards Europe and the US due to stricter environmental requirements.

India: Adani Group has announced a US$750m investment in Rajasthan, with US$375m allocated over the next five years to green energy, cement production and infrastructure development. The group plans to add four cement units, increasing its total capacity by 6Mt/yr, according to BusinessWorld magazine.

Nigeria: Lafarge Africa has unveiled a Mathematics Masterclass for Senior Secondary School students from both public and private schools across Ewekoro and Sagamu Local Government Areas, where the company’s manufacturing plants are located. The company explained that the initiative, which was part of its corporate social responsibility efforts, aimed to address the high failure rates in mathematics and science subjects among students in its host communities.

At events held separately in Sagamu and Ewekoro, Lolu Alade-Akinyemi, CEO of Lafarge Africa, emphasised the importance of mathematics as a key subject, stating “Mathematics is a fundamental subject that unites science and humanities. This is a major reason for why Lafarge is investing in it. We want to help students to improve in this subject and to better equip them for the future.”

Zambia: China Zambia De Jin Xin Cement plans to invest US$170m in the Zambian economy to build a cement plant, a power plant, a mine and a high calcium powder plant, according to ZNBC. The construction is expected to begin in November 2025, according to the company's director, Jianbao Zhao. This investment will reportedly create over 1000 jobs during the construction phase and more than 500 permanent positions once operational.

North Macedonia: Titan Usje will invest €20m over the next three years to modernise its operations, focusing on digitalisation and new technologies. Since 2019, the company has invested over €6m in digitisation and artificial intelligence solutions. The system is being rolled out across all Titan plants and is designed to maximise production efficiency, reduce energy use by over 10% and improve product quality, while cutting CO₂ emissions.

When we think about ‘up and coming’ regions for the global cement sector, Africa is high on many people’s lists. This is unsurprising given that Africa is the youngest continent on Earth, with a population set to boom to 2.5 billion by 2050 – or 1 in 4 of the global population for that year, according to the UN. This population, 1 billion higher than today, will drive rapid urbanisation. Cement capacities, currently around 350Mt/yr across the continent, will have to rise substantially to meet demand.

Filling part of this rise will be Amsons Group. This week it announced plans for a US$320m investment in a 1.6Mt/yr greenfield cement plant in Tanzania. It also promised a whopping US$400m to revamp Bamburi Cement in Kenya, should its existing US$180m bid for the Holcim subsidiary be accepted. Based on the numbers for Tanzania, this investment might be enough to take Bamburi Cement from 1.1Mt/yr to around 3Mt/yr, assuming similar project scope and equipment suppliers.

So, what is Amsons Group? Founded in 2000, Amsons is a Tanzania-based conglomerate with interests in construction, transport, flour, container depots, cement and concrete. It already operates Camel Cement, a grinding plant, in the Mbagala suburb of Dar es Salaam and it owns a 65% stake in the 1.1Mt/yr integrated Mbeya Cement plant, which it bought from Holcim in September 2023. The group’s website states that it emphasises local production of materials to reduce the nation’s reliance on imports. A greenfield cement plant fits right into that philosophy.

Looking at recent market trends, we see some positive news for Amsons. In Tanzania, cement production rose by 6.2% to 8Mt in 2023, according to the country’s Ministry of Industry. This followed a 9.7% rise in the prior year. Data is so far lacking for 2024. To the north, cement consumption ramped up strongly in Kenya in the second half of 2023, following a less than stellar start to the year. Thanks to a particularly strong June to September period, consumption finally ended 2023 around 0.8% higher than the previous year, at 9.6Mt. However, consumption tailed off in the final quarter. Worse, the first four months of 2024 - the most recent data available from the Kenya National Bureau of Statistics - saw a 10% decline in cement consumption relative to the same period of 2023, falling to 2.6Mt/yr.

As Africa lacks cement capacity compared to other regions, it is important to highlight that Amsons’ new plants will have to take on not just existing capacity in East Africa, but countries that export to the continent too. Indeed, this week Pakistan, a long-time agitator of South African cement producers, reported a year-on-year rise in exports for October 2024. Exports rose to 4.36Mt, a 9% increase compared to 4Mt in October 2023. This news comes amid precipitously falling domestic demand within Pakistan, with September 2024 shipments down by 22% year-on-year. It is also worth noting that Tanzania itself exported around 1.1Mt of cement to Rwanda, Burundi, Malawi, the DRC and Zambia in 2023. This figure will likely be higher in 2024, given the February 2024 launch of Huaxin Cement Tanzania Maweni Company’s 1.3Mt/yr plant in Mavini, which has a focus on exports.

This apparent abundance of existing capacity, plus exposure to imports, would appear to give an investor like Amsons Group pause for thought. However, it has committed to a total investment of US$900m. This is not small change. If we add in the money it paid for Mbeya Cement in September 2023 – the amount was not disclosed – Amsons will likely shell out more than US$1bn in just a few years. It is going ‘all in’ to become, in the words of its Managing Director Edha Nahdi, “one of the largest cement manufacturers in Kenya and Tanzania by 2030.” It will be very interesting to follow it on its journey.

Kazakhstan: Aktobecem will build a cement plant in the Aktobe region with a production capacity of 2Mt/yr. The company intends to invest US$143m in the facility, which will create over 500 jobs, according to Trend. Construction is set to begin in spring 2025, with operations commencing in 2026. The construction of the new plant will reportedly supply 80% of the cement needs of the region and reduce logistics costs.

Tanzania/Kenya: Amsons Group will build a US$320m cement plant in northern Tanzania's Tanga area with a production capacity of 5,000t/day, Bloomberg reports. The company also plans to implement a major upgrade at the recently acquired Mbeya Cement in Tanzania, including a new grinding mill, according to Capital News Kenya. Additionally, Amsons plans to invest US$400m in Holcim’s Kenyan subsidiary Bamburi Cement, contingent on its successful US$180m bid.

Edha Nahdi, managing director at Amsons Group, said "Thanks to the support of the Tanzanian and Kenyan governments, our regional expansion plans are now firmly on course. We plan to be one of the largest cement manufacturers in Kenya and Tanzania by 2030."