Heidelberg Cement Tanzania Unit to Build Fifth Factory by 2014

HeidelbergCement AG (HEI)’s Tanzanian unit will invest 50 billion shillings ($31 million) to build a fifth plant there by 2014, boosting capacity to 2 million metric tons a year, Managing Director Pascal Lesoinne said.

Tanzania Portland Cement Co. has hired Tianjin Cement Industry Design & Research Institute Co. to construct a factory with the ability to produce 700,000 tons a year in the commercial capital of Dar es Salaam, he said.

“We have seen a tremendous growth of our sales in Tanzania and we need to keep up with the demand in the future,” Lesoinne said on April 16 in an e-mailed response to questions. “The market in Tanzania will continue to grow but the competition will intensify with the cement production units already under construction and those in the offing.”

Cement demand grew about 10 percent last year to 2.7 million tons in Tanzania, where construction is booming, according to the company’s annual report. Growth in the building industry accelerated 6.5 percent in the third quarter of 2012, from a contraction of 5.4 percent a year earlier, according to the country’s National Bureau of Statistics.

An upgrade of a clinker line at Tanzania Portland’s Wazo Hill plant has ended the company’s reliance on expensive imports, he said. The company, which is also known as Twiga Cement, will begin to produce aggregates including gravel and sand this year.

To contact the reporter on this story: Sara Jerving in Nairobi at sjerving@bloomberg.net

To contact the editor responsible for this story: Nasreen Seria at nseria@bloomberg.net

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