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Tinashe Makichi Business Reporter
Government has been called on to create a level playing field in the cement manufacturing industry as cheap imports continue to flood the sector.

About 60 000 tonnes of cement are being imported into the country on an annual basis leaving the local cement manufacturing industry on the brink of collapse. At a price of $173 per tonne it means Zimbabwe is receiving imports of cement worth about $108 million annually.

Speaking at a business breakfast meeting organised by the Ministry of Industry and Commerce last Friday, industry representative Kelibone Masiyane, who is also the PPC Zimbabwe managing director said Zimbabwe has become an attractive market for imported cement.

“We estimate that around 5 000 tonnes of cement a month is being imported. As an industry we are facing a serious threat. We have imports coming in which we cannot compete with if we factor in our local cost of production,” said Mr Masiyane.

He said despite the threat posed by cheap imports, the whole cement industry has so far invested about $185 million towards retooling while an additional $86 million is being invested at PPC’s manufacturing plant in Harare.

The country’s main producers at the moment include Lafarge, PPC and Sino Cement.

PPC is the largest producer at 760 000 tonnes, Lafarge is on 450 000t and Sino-Zimbabwe at 250 000t

“What we are asking from Government is support at the moment because protection or tariff introduction in general can be permanent but what we need is support in order for us to compete with imports that have flooded the market.

“There is obviously quite a lot that can be done especially issues to do without high input and electricity costs as they are the major cost drivers in the cement industry,” said Mr Masiyane.

He said cement companies are currently getting electricity at around 14 cents per kilowatt hour while there are allegations that other industries are getting electricity at a much lower rate.

Zimbabwe’s cost of production remains unsustainable for cement companies who are currently producing a tonne of cement for about $150 compared to other countries in the region which are producing at $60.

Mr Masiyane said the prevailing high cost of production has significantly affected cement manufacturers capacity to export.

Since 2014, cement exports have been going down recording 100 000 tonnes in the same year to less than 40 000 tonnes in 2015.

“This year there is absolutely nothing in terms of exports not because we have changed our product quality but it was more of an exchange issue. Right now all the currencies in the region have depreciated following the firming of the US Dollar and our products are now more expensive in those countries.

“This therefore calls for Government to re-look at the manufacturing cost base in the country and come up with solutions to see how we can reduce the cost of electricity among other issues like levies and taxes. So if we are to compete on the export market we should look at those issues as a country,” said Mr Masiyane.