Ugandan construction boom see cement prices rise

Ugandan construction boom see cement prices rise
Published: 06 May 2008

The construction boom in the region has led to high demand for cement. This has been compounded by supply shortages, causing rapid price increases.
The price of cement has surged to sh27,500 from sh25,000 in Kampala. Upcountry costs are as high as sh30,000 a bag.
With almost no fresh capacity in sight, the price is expected to skyrocket further. This is expected to push up construction costs.
Allen Mate, the Hima Cement plant manager, explained over weekend that the cement demand was rising in eastern DR Congo, Rwanda, South Sudan and Tanzania.
"Cement consumption has drastically increased for the past five years because of these countries’ economic growth," he said during a meeting with parliamentarians on the natural resources committee.
"The increasing crude oil prices in the world market have increased the production costs.
"We use heavy-fuel oil which is transported from Mombasa. So any price increment will affect production and the cement price will go up." Mate said unreliable and expensive electricity supply had affected cement production.
"We have constant power outage which affect production. We pay sh660m for power but it is insufficient. We are not informed when the power outages will take place," he complained.
"On a daily basis, we have four outages and power availability is unpredictable. Enough and constant power is critical for the production of cement."
Experts said the only way to counter rising prices was to increase cement production capacity.
Hima Cement and Tororo Cement, the only local manufacturers have a combined capacity of 575,000tpa.