Inspite of a grading crisis that has dogged the cement industry since February this year, key stakeholders have been pushing out new and better products which are redefining the country’s industrial and construction spaces.
The industry has seen phenomenal growth in recent times, which is expected in a country with a large and growing population, yet challenged by high housing deficit which the United Nations (UN) estimates at 17 million units.
With a population of 170 million people, Nigeria has a little above 10 percent home ownership level and out of the estimated 720,000 housing units needed yearly, to bridge the housing deficit, only 10,000 units are produced by both public and private efforts at housing delivery.
Analysts are of the view that rising demand for both residential and commercial properties arising from the deficit, improved investment interest in various sectors of the economy, all of which require real estate components, are the major drivers of cement industry growth.
This rising demand has led to increased capacity in the industry to about 40 million metric tonnes, up from two million metric tonnes 12 years ago.
Not too long ago, the industry was rocked by controversy over acceptable cement product grades for different levels of construction. It was alleged in some quarters that the 32.5 R/N grade was responsible for building collapses in the country, an allegation that was quashed by some professionals in the sector.
The allegation was subsequently followed by the restriction of 32.5R/N to plastering, and the elevation of the 42.5R/N grade to major construction undertakings by the Standards Organisation of Nigeria (SON). This situation has since been legally challenged by local manufacturers who produce the restricted grade in large quantity.
However, in spite of the crisis situation, Dangote Cement, the largest in the industry in terms of output, has remained upbeat and has introduced different product ranges since then.
The cement maker has since launched the 52.5 grade, as well as the 42.5 grade 3X cement. DangCem has also launched the 32.5 grade of cement, in order to play at all levels and segments of the market.
Its capacity has been ramped up to 29 million metric tonnes, while the company plans to expand further and unveil other solutions, according to findings.
Apart from Classic, Supaset, Powermax, Readymix , aggregates and concretes products, Lafarge Africa has innovated RoadCem cement, which is a specialised cementitious binder, designed to meet the needs of a wide range of road applications.
Lafarge has also unveiled the OneCem low density cement product for the oil and gas sector. The product is expected to be in use by major oil firms in the country by mid 2015.
It is a product that tailors performance needs as a system platform, while having the capacity to integrate into conventional blending and pumping equipment.
“We also have what is called Sulfur Resistant Cement, which is particularly suitable for bridges, construction where there is sea water or that is subject to alkaline erosion,” said Guillaume Roux, group managing director and chief executive officer of Lafarge Africa Plc, in an interview with BusinessDay in Lagos.
“And this is just cement. We have ready mix business and it is growing fast. We have ready mix for foundations; we have it for columns, for beams and this is gaining a lot of traction, and it is again new innovations,” he added.
Nigeria’s cement industry’s capacity has outstripped South Africa’s 18 million metric tons and has become the largest in sub-Saharan Africa. Its capacity has moved beyond 40 million tons, while players are expanding capacity.
The United Cement Company of Nigeria (UniCem) is investing N84 billion in an additional 2.5 million tons cement line project, to double its 2.5 million tons existing capacity to five million tons per annum, by 2016, and consolidate its position as Nigeria’s third largest manufacturer.
Also, Ashaka Cement is investing N100 billion to increase capacity to four million tons per annum, from the current one million.
Huge infrastructural needs and urbanisation have largely boosted the fortunes of cement makers, as they increase product demand.
“The industry outlook is good. In future too, we are planning to launch cement plants. That shows the confidence in the long-term,” said Edwin Devakumar, group managing director, Dangote Cement, in an earlier interview with BusinessDay.
CHUKA UROKO & ODINAKA ANUDU
