Displaying items by tag: Zambia

Zambia: The Board of Commissioners of the Competition and Consumer Protection Commission (CCPC) has fined Lafarge Zamiba over US$19,000 for abusing loyalty discount schemes, price discrimination and excessive pricing. The fine represents 10% of its annual turnover in 2012, according to the Times of Zambia newspaper. It follows an investigation in the cement producer from mid-2013 following accusations of ‘persistent’ price rises.

The CCPC says that Lafarge Zambia’s pricing policy discriminated the domestic market against the export market and particularly distorted the sector in Lusaka. It has ordered the company to cease and desist such behaviour and to report to the board in early 2018 regarding how it is complying with the ruling.

Lafarge Zambia operates two cement plants in the country. It says it made revenues of US$171,000 in 2016.

Zambia: Dangote Cement Zambia has contracted Zambia Railways to transport 2000t/month of cement and 500t/month of coal. Zambia Railways is transporting cement from Ndola to Lusaka and coal from Batoka to Ndola on behalf of Dangote Cement, according to the Times of Zambia newspaper. The cement producer operates a 1.5Mt/yr integrated plant in the country with 1200 employees and a fleet of over 500 trucks. It also runs a 30MW coal power plant.

Zambia: A contract with LafageHolcim has boosted Zambia Railways freight rate by 28% year-on-year to 318,000t in the first half of 2017 from 247,000t in the same period of 2016. The railway company attributed the increase to a new contract with LafargeHolcim, according to the Zambia Daily Mail newspaper. It also cited rising coal imports from Zimbabwe for ‘booming’ cement production in Zambia, as well as more business in the Democratic Republic of Congo.

Zambia: Dangote Industries Limited says it will continue to penetrate the Zambian cement industry and is targeting 1Mt of sales by the end of 2017. This follows record sales of 0.3Mt of cement during the first six months of 2017.

Country CEO Desmond Maharaj said that Dangote would look to spread its influence in more Zambian provinces going forward. He added that export markets such as Malawi, Democratic Republic of Congo and the great lakes region were also attractive, hence leading to the company to produce more cement from its Zambian operations.

Zambia: President Edgar Lungu has launched a US$548m cement plant project to be built in Ndola by the government and China’s Sinoconst. The plant will be a joint venture between the government-owned Zambia Consolidated Copper Mines Investment Holdings (ZCCM) and Sinoconst, according to Reuters. The project is intended to diversify the country’s industries away from copper mining. The unit will have a cement production capacity of 5000t/day and will use two 20MW captive coal-power plants.

Zambia: Lafarge Zambia’s export volumes of cement and clinker rose by 53% year-on-year in 2016. Domestic sales volumes fell by 42%, its sales revenue fell by 43% to US$93,000 and its profit before tax dropped significantly to US$13,000. The cement producer added that power supply issues had adversely impacted production costs at its Chilanga and Ndola plants. The company is positive in its outlook for 2017 and it is supplying building materials to large infrastructure projects including the Kafue Gorge Lower and Kenneth Kaunda International Airport.

Zimbabwe: PPC Zimbabwe’s managing director Kelibone Masiyane has said that duty on cement imports has done little to discourage the market. The government introduced a 25% duty on every 100t of imported cement in 2016, according to the NewsDay newspaper. He singled out imports from Zambia as well as those from South Africa, Mozambique and Botswana.

“In addition to liquidity challenges, we continued to face pressure from cheap imports. Government has tried to assist by introducing duty on imported cement, but the reality on the ground is that imports continue to pour in, particularly from Zambia,” said Masiyane. Despite this he added that PPC Zimbabwe was confident that the local economy would pick up in 2017 supported by infrastructure projects.

The Cement and Concrete Institute of Zimbabwe lobbied the Ministry of Industry and Commerce to ban imported cement in 2016. In a paper it suggested including a protection tariff to equate the landed price of imported cement to the cost of the local product, granting of import licences to local producers, cancelling or reviewing all issued permits that are circulating in the country and lowering duty on raw materials.

Nigeria: Dangote Cement’s pre-tax profit has fallen by 10.9% year-on-year to US$466m in the first nine months of 2016 from US$523m in the same period in 2015. Its earnings before interest, taxation, depreciation and amortisation (EBTIDA) fell by 16.3% to US$559m from US$667m. However, sales revenue rose by 20.9% to US$1.38bn from US$1.14bn. It blamed the drop in profitability on falling prices in Nigeria, negative currency effects and on rising fuel and power costs.

“Nigeria has achieved record volume growth and our non-Nigerian operations are performing well across Africa. Our switch to coal in Nigeria will have an immediate impact on margins now that we have abandoned the use of low pour fuel oil (LPFO), improving fuel security and reducing the need for foreign currency. Furthermore, our new pricing will offset the impact on costs of the devalued Naira,” said the chief executive officer, Onne van der Weijde. He added his company’s strong performance in sales had been hit by poor economies in the countries it operates in and by heavy seasonal rains in West Africa.

The producer reported that its sales volumes of cement sold grew by 28.1% to 11.9Mt in Nigeria and by 72.9% to 6.5Mt elsewhere in Africa. Sales outside of Nigeria were bolstered by production ramp-up in Ethiopia and Zambia, new operations in Tanzania and improved sales in Ghana. Plants in the Republic of Congo and Sierra Leone are due to become operational in mid-November 2016.

Zambia: Lafarge Zambia and Zambia Railways have signed a transport agreement to improve the delivery of production inputs for cement production and to distribute clinker and cement products locally and to neighbouring countries. The deal is intended to complement other modes of transport, reduce reliance on roads and promote sustainability. The agreement will run for three years and is subject to renewal.

“We continue to have a high fleet of trucks on our roads responsible for both inbound and outbound logistics, in excess of 500 trucks. The pressure exerted on the roads continues to be high as a result of this activity. Therefore, this partnership will relieve some pressure off our roads as it complements other modes of transportation currently in use today and we also anticipate to reduce the safety risk on the road,” said Chrissie Moloseni, Chief Financial Officer of Lafarge Zambia at the signing ceremony on 8 July 2016.

Christopher Musonda, the Chief Executive Officer of Zambia Railways, added that the company has devised a new transport model to improve efficiency. The Wagon Monitoring and Control System (WAMCO) is designed in a way that will enable customers to have dedicated wagons for all movements, thereby improving efficiency levels.

Zambia: Lafarge Zambia’s revenue has fallen by 6% year-on-year to US$250m in 2015 from US$267m in 2014. Its profit fell by 24% to US$62m from US$82m. The subsidiary of LafareHolcim blamed the results on challenging markets, power costs increase and steep currency depreciation.

“Despite new competition and challenging markets, Lafarge Zambia maintained its market leadership in 2015 both in Zambia and in the Democratic Republic of the Congo, with a marginal reduction versus our record 2014 volume numbers. The second half of 2015 saw a combination of negative factors both in terms of market and in terms of production costs,” said Lafarge Zambia CEO Emmanuel Rigaux.

In 2016 the cement producer expects the market to be challenging for both price and volume. It intends to focus on exports markets in the Democratic Republic of the Congo, Malawi, Zimbabwe and Tanzania. A partnership with the rail authorities including Zambia Railways Limited is also expected to further aid exports.