Displaying items by tag: Nigeria
Nigeria: The China Civil Engineering Construction Corporation (CCECC) has released plans to invest around US$1bn in Nigeria towards the construction of a cement plant and other projects, including the modernisation of a port near Lagos, a saw mill, real estate investment and manpower development. President of CCECC, Yuan Li, made the announcement in conjunction with a Nigerian delegation to Beijing led by the Nigerian President Goodluck Jonathan.
Nigerian army shuts fake cement plant
28 June 2013Nigeria: The Nigerian Army has reported that a fake cement production plant has been discovered in Ewekoro, Ogun State. According to a statement made by Captain Adamu Yahya Ngulde of the 35 Artillery Brigade, eight suspects were arrested at the site on 25 June 2013 and four cement trucks were found.
"Based on our preliminary investigation, the suspects get cement from the Dangote Cement Company and Lafarge and adulterate it with sand dust and package it in Dangote cement bags for distribution," said Ngulde. The suspects and the vehicles have been detained pending an investigation.
A sub-Saharan showdown…?
12 June 2013In the global cement news this week, we see that PPC (the former Pretoria Portland Cement), a large-scale domestic player in the South African cement industry, has taken it upon itself to provide association-like services to cement and concrete consumers in the country. PPC says that it felt obliged to supply information on things like quantity analysis, setting advice and product testing in the place of the now-defunct Cement and Concrete Institute (CCI).
The CCI, lambasted by PPC and other cement producers for years, was accused in April 2013 by PPC of not providing the kind of advice and services that cement producers should expect from an association. PPC, Lafarge and AfriSam all pulled funding and the CCI collapsed.
If the CCI had simply ceased to exist, PPC's new stance, putting its own cash into industry-wide assistance, might be seen as laudable. However, the CCI has been re-born as the Concrete Institute (CI), an organisation that is, by its own admission, no longer on the lookout for the interests of the whole industry. The CI is largely backed by Sephaku Cement, itself majority owned by the Nigerian cement juggernaut Dangote Cement, making PPC's stance suddenly look like one of self-preservation. Dangote is making rapid progress in the sub-Saharan cement industry and firms like PPC cannot afford to let it sweep aside the status-quo in South Africa.
The speed and scale of Dangote's rise, covered previously in this column, is huge. Nigeria's largest company now has interests in Senegal, Zambia, Tanzania, Congo, Ethiopia, Cameroon, Ghana, Sierra Leone, Ivory Coast and Liberia as well as Nigeria and South Africa. Not a month goes by without the announcement of another upgrade, plant or project. Dangote has a fantastic position in its domestic market that has enabled these new projects to be funded.
By contrast PPC is battling a stale construction market in South Africa. South African cement sales fell by 3.8% year-on-year in the fourth quarter of 2012. To counteract this, PPC has committed to expand outside of South Africa to the tune of 40% of total production by the start of 2016. It announced in early 2013 that production is on track to come online in Rwanda, Ethiopia and the Democratic Republic of Congo by the fourth quarter of 2015. Zimbabwe is expected to follow suit by the middle of 2016. It already has interests in Botswana and Mozambique.
With two of its largest home-grown cement producers both expanding rapidly outside of their domestic markets, and a relative lack of interest from the big four multinationals, the sub-Saharan cement market is set for big changes in the medium to long term. PPC and Dangote are expanding towards each other and already share many markets. Dangote has expanded more rapidly and is moving towards exports from Nigeria. PPC is catching up by taking shares in strategically-placed plants. Is sub-Sahara headed for a showdown...? Whatever happens, the future of this rapidly-growing market will certainly be interesting.
Alhaji Ibrahim Aminu appointed executive director (finance) of the Cement Company of Northern Nigeria
05 June 2013Nigeria: The Northern Cement Company of Nigeria has appointed of Alhaji Ibrahim Aminu as executive director (finance). He replaces Finn Arnoldsen. Alhaji Garba Muhammad Sarkin Kudu has been appointed as a non-executive representing Sokoto State Government on the board, replacing Alhaji Sani Garba Shuni. The appointments take immediate effect.
Alhaji Ibrahim Aminu, a chartered accountant aged 45, holds a Bachelor of Science Degree in Accounting from Ahmadu Bello University. He started his working career in 1991 with the Federal Civil Service Commission, Lagos and subsequently worked for the Nigeria Universal Bank, the Nigerian Security Printing & Minting Co, Nigerian Telecommunications Ltd and BUA Flour Mills, before joining the Cement Company of Northern Nigeria as financial director in 2010.
Alhaji Garba Muhammad Sarkin Kudu, aged 53, holds a Bachelor of Art Degree in History from Usman Dan Fodio University. He has held various roles with the Sokoto state government becoming the Permanent Secretary Ministry of Commerce, Industry and Tourism prior to his appointment with the Cement Company of Northern Nigeria.
Dangote net profit soars by 80% to US$340m in Q1
08 May 2013Nigeria: Dangote Cement has reported a rise in net profit of 80.7% to US$340m in the first quarter of 2013 from US$188m in the same period in 2012. The Nigerian cement producer attributed the gain to an increased market demand of 15.7% (estimated 5.4Mt), improved gas supply and falling imports of cement into the Nigerian market.
Dangote's revenue rose by 39.5% to US$604m from US$433m. Earnings before interest, taxes, depreciation and amortisation (EBITDA) rose by 67.3% to US$398m from US$238m.
"Our 38% increase in volumes far outpaced the Nigerian market's strong growth of 16%," commented Devakumar Edwin, group managing director and chief executive of Dangote Cement. "Our gas supply has been better this year and that has driven margins upwards from the first quarter of 2012, when our new capacity at Ibese and Obajana was just coming on stream.
In its outlook Dangote reported that the strong demand had continued in April 2013. It noted that gas supply problems, which hindered its Obajan cement plant in particular, might continue in 2013. Cement exports are expected to make a modest contribution to 2013 sales.
Nigerian cement producers seek code of standards review
17 April 2013Nigeria: The Cement Manufacturers Association of Nigeria (CMAN) has called for a review of the industry's code of standards. CMAN chairman, Joseph Makoju, made the call at a forum in Abuja on concrete specifications, applications and cement standards.
"We need to have our own relevant code of practices and standards revised taking local conditions into consideration. It is also very important that our codes are robust and standards are robust, practical and uniformly and consistently applied in practice," said CMAN vice chairman Jean-Christopher Barbant. He added the current codes, when reviewed, would ensure uniformity in applications.
Joseph Odumodu, the director general of the Standards Organisation of Nigeria, said that the issue of quality had been a major challenge facing the regulatory agencies. He cited an example of 32 cement trucks from Benin that had been blocked from entering Nigeria as an example that the federal government should emulate.
Nigeria to raise tariff on cement imports
20 March 2013Nigeria: Minister of Trade and Investment, Olusegun Aganga, has announced plans to create a new tariff on imported bulk cement. The move follows the alleged cement 'glut' surrounding a dispute between importer Ibeto Cement and leading producer Dangote Cement in late 2012. The current duty on imported bulk cement is 10% but no levy is imposed on the commodity.
At a meeting on Nigerian business competitiveness organised by the Nigerian Economic Summit Group (NESG), Aganga said that there was no basis for importing cement clinker since Nigeria has a cement production capacity of 28.6Mt/yr. He also stated that at no time did he issue any import permit for bulk cement in 2012.
Getting into Africa
13 March 2013If 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).
Edo Cement to commission 3Mt/yr plant in 2014
27 February 2013Nigeria: Edo Cement Company's new US$500m plant in Okpella, with a cement production capacity of 3Mt/yr, will be ready for commissioning in early 2014, the chairman of parent company BUA Group has said.
Alhaji Abdulsamad Rabiu made the announcement at the signing of a US$35m contract agreement between BUA Group and Siemens to build a new gas turbine power plant for the plant. The contract, which was signed with Siemens at BUA's London office, was for Siemens to supply three SGT 500 turbines manufactured by Siemens Industrial Turbo Machinery AB in Finspang, Sweden with a total capacity of about 45MW. These will supply power to the Edo Cement plant, which is currently under construction.
"I am particularly very impressed so far by the civil construction work done by Julius Berger. 70% of the cement plant equipment has been shipped and is currently on site and the pace of work is very comprehensive and impressive. By early 2014 the cement factory will be ready for use," commented Rabiu on the plant's progress.
UNICEM to double cement capacity to 5Mt/yr by 2016
13 February 2013Nigeria: Flour Mills of Nigeria plans to borrow up to US$500m to finance a 2.5Mt/yr upgrade at its 2.5Mt/yr UNICEM joint venture cement plant in Calabar, according to its chief finance officer. Flour Mills operates in the Nigerian cement market as Burham Cement and it shares its joint venture with Holcim and Lafarge.
In an interview with Reuters, Jacques Vauthier announced that the conglomerate had appointed financial advisers and banks to raise a term loan from the local market for the construction of the plant. He said that the details of the loan were still being finalised. The new cement plant will be completed by the first quarter of 2016.
Vauthier acknowledged the cement glut in 2012 and blamed it on cheap imports from Asia. He added that sales were picking up again and he expected its cement subsidiary Unicem to end 2013 with a year-on-year growth rate that is in double-digits.
This news story was updated on 11 November 2013 with the exisiting capacity of the UNICEM cement plant