Asoko Sector Brief – Côte d’Ivoire Cement Production Q2 2017

The rapid rollout of public works projects under Cote d’Ivoire’s national development plan has supported expansion in the cement sector, with total capacity expected to exceed demand by 2018.

By far the largest capital injection into the sector is Nigerian firm Dangote Cement’s $230 million grinding plant in Yopougon, near Abidjan. The project – the company’s first venture in Côte d’Ivoire – consists of a two-line facility with an annual capacity of 3 million MT. The plant is due to begin operations before the end of the year.

Dangote is far from the only producer looking to establish a foothold in the fast-growing economy. By the end of 2017, both Burkinabe CIM Metal Group and Turkey’s Limak Holding – who has partnered with local producer Afrikbat – are due to finish work on their respective greenfield projects, adding a combined total of 3.6 million MT of capacity to the market.

Other firms have also been expanding their existing Ivorian operations. Morocco’s Ciments d'Afrique (CIMAF), for example, is in the process of adding two new developments to its existing portfolio, including a $60 million 1 million MT facility in San Pedro and a $22 million 350,000 MT plant in Bouake. This comes on the back of a 500,000 MT expansion of CIMAF’s grinding plant in Yopougon in 2016.

Similarly, Socimat – formerly LafargeHolcim Cote d’Ivoire’s– announced in April that over the course of the next year it would double its current capacity to 2 million MT, including the construction of a new $24.5 million grinding plant.

In pursuit of its ambitious development agenda to become an emerging market country by 2020, as well as tackling infrastructural damage inflicted throughout the 2011 civil war, Cote d’Ivoire’s demand for cement continues to outstrip local production. While 2015’s output was estimated to be around 2.9 million MT, demand stood at 3.7 million MT.

To address the shortage, the government has introduced a strict schedule of cement importation in recent years. Between April and July the country will import 150,000 MT in three phases.

This should support a fast growing construction industry - which is expected to grow at an average rate of 7.1% between now and 2019 - largely driven by public sector projects including port projects in Abidjan and San Pedro, as well as the 1000-km San Pedro-Bamako railway corridor. The incumbent government pledged to raise $25 billion in investment for up to 94 infrastructure projects between 2015 and 2020 under its, with about half such projects taking on a PPP status.

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