Lafarge Africa hopes to boost its market share in Uganda’s cement market through its subsidiary Hima Cement Ltd’s new plant in the country’s eastern region.
The $40million plant, set to be constructed at Nyakesi in Rubongi in Tororo, is expected to increase the firm’s cement production capacity to 1.8million metric tonnes compared with 800,000 metric tonnes currently produced at its plant in Kasese, located in the western region.
Hima Cement country CEO Daniel Pettersson said the surging demand for cement and concrete in Uganda and the East African region triggered the expansion.
“Hima Cement is committed to ensuring sufficient cement capacity to serve the national infrastructure and construction projects, individuals, and the commercial sector,” Pettersson said.
He said the firm is embarking on several capacity building projects starting with the construction of a grinding station at the end of this year.
The firm is in final stages of exploration for a limestone position in North East Uganda to support a future clinker position as well as launch a ready-mix concrete operation in Kigali in October.
Hima Cement’s expansions comes in as many months since TCL announced plans in May 2015 to invest $25million in expansion to increase annual cement production to three million metric tonnes, up from the 1.8 million metric tonnes annually.
Industry sources told The Independent that the ongoing infrastructure development projects in the energy and roads sector are a ready market for cement.
The country’s cement producers are currently facing pressure to meet the growing demand that is now estimated to be at 14% across the region, according to SWOT AFRICA Ltd report released in 2014.
The report notes that TCL commands the largest market share of 60% compared with HCL at 25%, Mombasa Cement Ltd, which is also TCL’s the parent company based in Kenya at 8% and the rest from imports.
On Sep 09, HCL signed a 5- year agreement with the Chinese firm, Guangzhou Dongsong Energy Group (Uganda) Limited, to supply Cement for the firm which is set to develop the huge phosphates deposits in Tororo at a cost of $640million.
Hima Cement will supply the required cement for the project to the tune of over 40,000 tonnes of cement for the first two years.