Nepal to be self-sufficient in cement production in 2019

The Cement Manufacturers' Association of Nepal claims that, while the import of clinker has increased due to high production demands, it expects the country to be self-reliant on clinker production from next year.

According to Dhurba Thapa, president of Cement Manufacturers' Association Nepal, cement factories in Nepal are now producing 8.5Mta of cement. Currently, there are 53 cement factories operating in the country that annually produce 160m sacks of cement. Mr Thapa also said the two new cement factories currently under construction are expected to enter operation soon.

The association revealed that NPR125bn (US$1bn) has been invested into the domestic cement industry to raise production capacity. Cement manufacturers claim that the Nepali cement market is growing by 10-15 per cent YoY.

Domestic production now meets 70 per cent of the market demand while the remaining 30 per cent is fulfilled through imports. Cement imports have been declining in the past few years. According to import data from the Trade and Promotion Centre (TEPC), Nepal imported cement worth NPR1.03bn in the fiscal year 2017-18 compared to NPR1.14bn in the previous fiscal year.

While Nepal is looking to be self-reliant in cement production, cement exports from the country are also being hindered by to high production costs, said the association. In addition, cement is sold in neighbouring countries at a more competitive prices than in Nepal's domestic market.

The import data of TEPC shows that Nepal imported clinker worth NPR30.21bn in the FY17-18 compared to PKR24.96bn in the previous FY16-17.
 
Capacity expansion plans
Jagdamba Cement has been producing 1.2Mta of cement from its two plants, said Sunil Paudel, senior manager. The company holds a 15 per cent market share in the domestic cement sector. According to him, Jagdamba plans to expand its production capacity and is in the process of setting up a cement factory in Nawalparasi. Similarly, the company also plans to establish its own clinker production unit in the future.

Meanwhile, Hongshi Shivam Cement, which opened its greenfield plant earlier this year, plans to double its output to 12,000tpd in the next two years.