Kenya: Dangote ups production for proposed cement plant

Aliko Dangote has increased the estimated volume of production for his anticipated Kenya cement factory, which is going to shake up the cement market in East Africa and lead to a further stagnation or drop in price.

“The yearly production capacity of the anticipated Dangote cement factory in Kenya has been doubled from 1.5MTA to three million tonnes per annum (MTA),” Dangote disclosed in its first quarter trading update.

The Kenya’s plant was estimated to cost $400 million but the decision to increase the capacity could see the capital investment rise significantly.

Dangote’s three anticipated cement plants(Tanzania, Zambia and Ethiopia), have a capacity of 8.5MTA in total placing it more than two times ahead of Uganda’s biggest cement maker Tororo and Kenya’s biggest cement maker Bamburi. These cement makers presently have a total of 3.15MTA capacity each.

Dangote, who has been known to dominate Nigeria’s commodities market with low-pricing strategies, is anticipated to have the largest cement production capacity in the East African region.

“The group intends to have about 60 million tonnes of production, import and grinding capacity in sub-Saharan Africa by 2016,” the firm said in a statement.

By Fumnanya Agbugah