A railway line would boost cement production and lower the cost , Mr Hussein Mansi the Chairman of the Lafarge group’s local operations has said.
The comments were made at the commissioning of the a US$120m new Hima Cement factory extension on 8 January. He said the cost of transportation and energy continue to push the price of local cement up.
"It costs five more times to transport a ton of cement in East Africa, compared to doing so in China and most of Asia," Mansi said.
The Lafarge Group is parent company of Hima Cement Uganda. The plant extension is expected to increase the production capacity to about 800,000tpa of cement. However for many property developers, the price is very high. Locally produced cement spent most of 2010 at an average of Ushs25,000 per bag. Imported Cement can also be weighed at the same average due to the high dollar rate.
This is why local producers like Hima Cement will want to see the fast tracking of the railway, which is much cheaper in providing transportation. This would then translate into lower prices for locally produced cement. Otherwise the local producers will keep seeking for the return of the common external tariff to protect themselves from the heavily subsidised imported cement.