Zimbabwe's cement demand outpaces supply

Zimbabwe is facing a cement shortage due to demand temporarily outpacing supply. The Confederation of Zimbabwe Industries (CZI) has demanded answers from the country's cement producers regarding the shortages.

"We met the cement producers yesterday and they all said they are operating at full throttle. Sales are going on. Usual informal traders were taking advantage of the situation and hoarding cement for speculative purposes," said Sifelani Jabangwe, president of the CZI.

As a result of the speculation, cement prices in some retail outlets have surged from US$10/50kg bag in 2017 to US$15/50kg in the past few weeks and finally to USD17/50kg this week.

However, Mr Jabangwe explained that despite the supply challenges with cement, "official retailers and wholesalers have not increased the price of cement". In the large formal retail and wholesale outlets – most of which have run out of cement stock - prices of the commodity have remained around US$11/50kg.

PPC Zimbabwe managing director, Kelibone Masiyane, clarified that “the current cement shortage is temporary,” adding that PPC had capacity to "supply the existing market" demand. "With regards to escalated cement prices in the market, PPC Zimbabwe can assure customers and other stakeholders that our factory prices have not increased," added Mr Masiyane.

According to reports, Lafarge Zimbabwe has imported SupaSet cement from Mozambique to counter the shortage. "We have been clearing Lafarge Cement this week. They have a consignment of about 5000t of SupaSet cement that we have processed," said an official with the Zimbabwe Revenue Authority on Wednesday.

Alongside foreign currency and liquidity constraints, the lack of cement is amongst several factors which have slowed the country’s construction industry. "The shortage has slowed down activity as projects have slowed down. The cost of completion has gone up. There has been a serious slowdown in construction activity in the past few weeks," said Shingi Nyamhandu, managing director at Harare-based Canistron Construction.