Recent times have seen the cement industry undergo vast change. The entry of Sephaku Cement in the later part of 2013, saw the industry’s first major cement producer to enter the market in nearly 70 years. The 1.1 billion Rand investment has seen Sephaku construct two production facilities, namely their Aganang plant in Lichtenburg, and their milling facility in Delmas, Mpumalanga. The two facilities are set to achieve a combined output of 2.5 million tons per annum. This additional supply will mean that the current cement demand of about 14 million tons per annum will be well exceeded with a forecasted annual supply of 17 million tons. Consequently pricing within the industry has become extremely competitive and massive strategic moves from the under threat likes of Afrisam, PPC, NPC and Lafarge have been made in order to secure their piece of the pie. Sephaku are set to take in the region of 15% to 20% of the local cement market. In an industry typical of passing price increases, even in times of weak demand, this will certainly not be the norm moving forward. The need for the Cement giants to secure major outlets for their cement is of utmost importance. Some of the cement producers have acquired smaller businesses and much speculation has come over the possible merge of PPC and Afrisam. The merge would see the “new co” have a combine market share of about 60%. The proposal of the merge together with the purchases of the cement outlets is in effort to increase scale, as multinational cement producers have targeted the South African market. It would also aid their efforts to enhance growth elsewhere in Africa. However talks between the two cement giants have seemed to Collapse, for now, as they could not reach consensus on the terms of the deal but we are sure this is not the last of these discussions….watch this space! South Africa’s cement market is set for even fiercer competition with the entrance of the Jidong Development Group, one of the largest enterprises in China’s building materials industry and one of the world’s top five cement groups. The project is being undertaken by Mamba Cement Company, who will be responsible for the limestone extraction and cement production. Mamba is set to come online in Q4 2015. The expected 1 million ton per annum output will put further pressure on an already price sensitive market. Mamba cement’s production facility will be based near Northam in the Limpopo province. Mamba Cement has major strength in their positioning which is ideally situated to supply the NW, Limpopo and Gauteng provinces. In conclusion, supply will continue to outpace demand in the South African market for some time to come. Political battles will be at the forefront of the industry and we can expect massive strategic movement among the Cement giants to ensure they secure their portion of the market.
Steyn City Depot
As of March 2015, Kwikbuild Cement has opened a depot near the Steyn City Development in the Johannesburg North area (Please see map below for directions). KBC has a large customer base within the Johannesburg area and with the opening of the depot we are better able to offer our customers value added services in the form of quicker turnaround times, smaller deliveries to suit demand requirements and off- loading of cement on site into containers or at point of usage.
From the depot, KBC will be offering smaller loads of 160 to 400 bags per delivery and the truck is accompanied with labour for off- loading. Customers are also able to collect from the depot which is far more conveniently located for this region.
For any enquiries, please contact Jason van Aswegen:
Tel: 087 654 0914
Cell: 082 577 4820
Kwikbuild Cement is a proud supplier for the well-established Central Developments Property Group. CDP has a proud track record for developing residential property including both high and low density affordable rental housing, of which the majority is in the Gauteng region. Little Manhattan is being developed at Lotus Gardens Ext 13, 14, 15, and 16 situated in western part of Pretoria. Little Manhattan is one of CDP’s latest affordable rental developments. The rental developments completed by CDP are strategically placed in order to best suit people staying in affordable housing developments. Amenities such as schools, public transport, access to major freeways e.g. N14 and infrastructure surround little Manhattan which is a mere 7km from the Pretoria CBD.
Not only does the development boasts a variety of pros for prospective residents, but also provides employment for 650 skilled and non-skilled people, many of whom are from the local community who participate in training programmes.The development will provide 1600 rental units which are set to be rolled out in approx. 400 units per extension and have an uptake of 40 units per month. The first units were occupied by August 2014 and all 410 units of phase 1 are set to be completed mid-2015. The supply requirements needed by CDP to construct a development of this magnitude are of utmost importance. Sticking to forecasted roll-outs means that CDP values its suppliers who go the extra mile. Kwikbuild Cement is extremely delighted to be one of CDP’s preferred suppliers and hope to continue building on this relationship for some time to come. For more information about little Manhattan and other current projects please visit the Central Developments Group website – www.centraldevelopments.co.za.