PPC threatened to shutdown Collen Bawn mine in Zimbabwe

LOCAL cement producers have warned of possible scaling down of operations and closures owing to an influx of cheap imported products from the region, saying protectionist measures could save the industry.

There is no need for Zimbabwe to import cement from neighbouring countries because local cement producers have the capacity to meet the current demand, an industry official has said. Zimbabwe is currently importing cement from Botswana, South Africa and Zambia, thereby depressing the market.

In a presentation to analyst, PPC Chief Executive, Darryl Castle told analysts that they told the Zimbabwean government that if it does not impose to curb cement imports, PPC will shut down Collen Bawn mine and also bring in cement from their Slurry plant in South Africa.

Effective 1 October 2016 the authorities have introduced import tariffs of US$100 per ton of cement.

Among some of the measures that industry is pushing for are a protection tariff to equate the landed price of imported cement to the cost of local manufacturers (US$50/t cement), granting of import licences to local producers, cancellation or review of all issued permits that are circulating in the country (estimated at 5000 tonnes/month or 5% total demand) and lowering duty on raw materials.

Njombo Lekula, the former managing director of PPC Zimbabwe was once quoted saying, "PPC Zimbabwe is looking to the future of the country, with today's event providing a promise of things to come. While our existing factory in Bulawayo has positioned us well in Matabeleland, it's clear that much of our country's future growth centres around Harare and northern Zimbabwe."

Mr Castle in his presentation said 67 employees from the Bulawayo factory will be moved to the Harare factory and PPC will employ only 30 new employees.

PPC Zimbabwe expects to commission its new Harare cement plant in 2016 at a cost of $80 million in addition to a new clinker mill on the Zimbabwean border with Mozambique for $200 million.
 
The group says the plant is expected to help boost operating efficiencies for the company which is set to close two mills at its Bulawayo plant as they are now inefficient.

Official figures show that all three players invested nearly US$185 million in the last five years in kiln upgrades, packing, grinding and other cement processes in order to improve efficiency to the existing equipment and reduce costs of manufacturing.

Sino has finished a significant upgrade at a cost of US$4 million, making a total of US$15 million in the last five years.

PPC has on its part invested US$53 million on kiln and mill upgrades and quarry optimisation at its two existing operations and is setting up a new grinding plant at a cost of US$80 million. Lafarge invested US$37 million over the last five years in quarry rehabilitation and equipment, cooler upgrade and systems automation.