At least five cement investment projects are in the pipeline, after the revised Investment Proclamation allowed cement investment, which was banned eight years ago, due to market saturation.
New cement projects named Dangite, Sinoma and Berberta requested to invest in billions of Birr, while Abay and Derba are already building production lines. Derba has got green light for expansion, which increases its production capacity by 2.5-million-ton per year. Dangite will also have 2.5 million tons production capacity. Abay, Dangite and Derba will have a combined production capacity of 7.1 million tons per year, almost equal to the existing 8-million-ton average actual annual production, according of Simegn Degu, director of Cement Industry Research and Technology Development at Chemical and Construction Inputs Industry Development Institute (CCIDI).
The Ministry of Trade and Industry allowed the import of 3 million tons cement a month ago, in order to bridge the aggregate cement demand which stood at around 11 million tons per year. The new investments in cement industry and import of cement have come eight years after the nation adequately substituted import locally. Nevertheless, actual production of the 14 existing cement industries could not meet the rising demand, due to shortage of foreign currency to import spare parts, soaring machinery maintenance needs, power supply fluctuation, illegal settlements in quarry areas, increasing hands of intermediaries in cement market chain and shortage of transportation.