PPC Zimbabwe sales fall 5%

PPC Zimbabwe's domestic sales fell by five per cent in the first five months of the year as housebuilding activity slows.

Managing director, Njombo Lekula, said domestic market sales have been flat compared to last year when growth in housing projects boosted demand for cement.

"For the past few years there has been significant growth in housing, which boosted cement demand, however, the current economic situation is beginning to have an impact on home building activities," he said.

The company is now looking to increase sales to regional markets in a bid to offset a slowdown in its domestic market. "Zimbabwe has cement capacity that exceeds current demand. I think it is good for the country if we are able to sell some of our excess production to the region and keep our plant capacity utilisation high," Mr Lekula said.

This is, however, despite the fact that the regional markets were also suffering from unstable and depreciating currencies. "Mozambique through Beira is prone to imports from the Far East and this renders the market very competitive," he said.

The PPC Zimbabwe boss said they have also had enquiries from Zambia and have sold into that market, however, the logistics posed a significant challenge and the pricing was equally affected by the fluctuating Kwacha.

PPC will start constructing a US$200m cement plant in the northeastern part of Zimbabwe this year. The expansion would give PPC extra capacity.

PPC has started constructing a clinker production facility with a grinding plant near Harare and Tete in Mozambique. The main market area targeted is the Harare region while the milling plant in Mozambique will target Tete. Currently, PPC has capacity for 760,000tpa.