Cameroon's cement capacity begins to soar
Cameroon's cement market has a new addition. In the last month, Cimpor Global Holdings' XAF39bn (US$64.5m) cement works in the southern port town of Kribi has begun operation. The market is intensely fought over with Cimenteries du Cameroun (Cimencam), MIRA Cement, Dangote, MEDCEM, CIMAF and Egin already on the ground and trying to carve out greater market share.
Cimpor's new 1Mta integrated plant, supplied through an engineering, procuring and construction (EPC) contract with Turkish-based Partner Teknik, is selling Powercem 32.5 cement exclusively in Kribi. The new 50kg bag is priced at a premium compared to its rivals, claims Business Cameroon, and the 32.5 grade product enables producers to sell cement with lower clinker content to help improve their margins. The Oyak subsidiary that is being bought by Taiwan Cement launched the higher grade Powercem 42.5 in the wider Cameroon market in June last year, and sells this at XAF51,000-51,300/t (US$84-84.50/t).
In addition to Powercem 32.5, the Kribi plant will also produce the country's first activated clay cement, supported by thyssenkrupp Polysius and STAS Engineering. Trials for this began in November 2023.
The importance of the Kribi plant is expected to be felt immediately as it is only the second integrated cement plant in the country. Consumers have been frustrated at the continued high price of cement which the government says has been kept high by the need to import clinker and instances of price fixing.
Capacity addition is incentivised
The country has seen a burst of new cement capacity in the last 24 months. Global Cement Report, 15th Edition (GCR15) estimates that the country's cement capacity totalled 7.20Mta in 2023. This has been helped by the 2013 law (revised in 2017) devised to incentivise private investment, offering tax exemptions for periods ranging between 5-10 years, covering both the launch and operational phases.
Last year, Ciments de l'Afrique (CIMAF) reported that it would triple the production of cement at its Bonaberi plant to 1.5Mta. CIMAF signed an agreement in February 2022 with the Investment Promotion Agency which enforced the 2013 legislation on new plant projects. The CIMAF expansion project was scheduled to begin operations at the end of March 2024.
MEDCEM Cameroon (Eren Holding Group) announced the start-up of its US$13bn Douala grinding plant in June 2023, which has a cement capacity of 0.6Mta. In June 2022 MIRA Cement began operations at its 2Mta grinding plant, the largest in the country, in Douala.The company is expected to be close to launching its second plant, a 1Mta integrated facility in Figuil.
Cimencam (Holcim) also plans a 0.5Mta expansion of its Figuil plant, the country's only other integrated plant. In addition, a 1Mta greenfield plant for the Atlantic Group to be operated by Société Internationale du Ciment in Kribi is expected to be completed later this year.
Other plants have been announced but are yet to reach the construction phase.
Market leader seizes marble opportunity
Cimencam (Holcim) has seen the benefit of a new road opened for its plant in Nomayos in November 2023. The Cameroonian Minister of Public Works, Emmanuel Nganou Djoumessi, opened the 5.5km road, which will help the company serve the central, south and eastern regions of Cameroon. The company is introducing a marble powder to be used in its cement production as a clinker substitute. This will be quarried from Bidzar, a marble deposit in the north. The quarry has an estimated operational lifespan of 25 years.
Dangote woes
Meanwhile, cement operations in Cameroon have not run as smoothly for Dangote, which entered the market in 2015. It has found itself in a land dispute over a 7ha plot of land in Nomayos. Dangote wanted the land as part of its second cement plant in the suburbs of Yaoundé, but the land was titled already to individual landowners. Moreover, Dangote lost a court case about its approach to land acquisition in February 2024.
Dangote also had the inconvenience of two of its trucks being held up in February 2024, when they were intercepted in Adamawa State, following an executive order banning the transportation of building materials across the country. However, the 600 bags of cement were allowed to proceed to Jamtari as they had been ordered by the Maiha Local Government Area of the state and were legitimately on their way there from the Obajana cement plant in Nigeria.
Changing market dynamics
The government's wish to reduce clinker imports and cement prices should start to become a reality in the next 1-24 months. Imports are estimated at 3.55Mt, according to GCR15, while current cement production is only estimated at around 4.3Mta, according to CGTN Africa. The new capacity coming on-stream is likely to change the market dynamics. The winners will be those who can optimise their plant quickly and develop a dependable logistics system.
