In efforts to curb the cement shortage by helping companies fulfil their plans on a timely basis, the Ministry of Trade and Industry (MoTI) has set up a forum to help new cement production investors come together and solve industry-wide problems encountered in project implementation.
The forum chairman is Girma Birru, minister of Trade and Industry, who chaired the first meeting on October 16, 2006. The Chemical Industry Support Agreement Execution Department within the Ministry has already started facilitation work. The forum will meet every month.
Among the companies involved in the production of cement are the two existing producers, Messebo and Mugher, as well as Ethio-Cement, National Cement S.C, East African Group Ltd, Derba-MIDROC, Jema Plc, Abyssinia Cement and Rina Cement Plc.
According to a study done in 2005 by Mugher, there is a 1.6Mt supply of cement in Ethiopia, with a 1.9Mt demand. However, according to information from the Ministry, with the construction boom in the country, there is an increase in the need where more than three 3Mt is in demand annually.
With the shortage in the supply, the government has set up short and long term plans for the cement industry. The short plan includes importing cement, while the long plan focuses on producing it locally.
Currently around 15 import and export and construction companies have registered to import cement, out of these Salini and MIDROC Derba are the prominent ones.
"The companies are expected to bring in the cement in 100 days, Salini’s 6000t are already in Djibouti" said Fantaye Biftu, Advisor to the Minister.
Around 11 companies will be entering in the production of cement and have leased land from the Oromia, Amhara, Tigray and Dire Dawa regional governments to start implementing their projects.
When five of them start operation, they are expected to provide around 500,000t in 2007. When all the projects in the pipeline are fully operational by 2011, they are projected to offer 14.6Mta, not including the existing factories.