Tanzania cement industry poised for growth

Tanzania cement industry poised for growth
Published: 12 September 2011

Tanzania’s cement production will have grown by 18 per cent by the end of 2011, well above the region rate of 13 per cent, thanks to higher than expected growth in the retail, infrastructure and mining sectors.

The Equity Research Cement Sector survey conducted by Tanzania Securities Ltd, an investment advisory firm shows that the construction and housing sector, which has compounded the annual growth rate of about 10 per cent, is the main driver of cement consumption, thus pushing up demand.

“The growth will be pushed by retail business, infrastructure development such as roads and bridges as well as real estate and if mining investments are sustained,” said Moremi Marwa, the chief executive of Tanzania Securities Ltd. “The outlook is good for investors who should buy stocks in cement companies.”

Tanzania’s current cement production stands at 3Mta against a demand of 2.2Mt while in Kenya the annual production stands at 2.2Mt. Tanzania’s increased spending on the construction of roads and bridges is also expected to give the cement business a big push.

The major producer is Tanzania’s Portland Cement, with a production capacity of 1.4Mt, followed by Tanga cement with 1.25Mta capacity and Mbeya cement with a 350,000t capacity.