Dangote Cement's pan-African volumes reduced by 11 per cent to 4.9Mt from 5.5Mt in the 1H22 due to increased supply chain challenges and maintenance activities. The best-performing markets for the group were Ethiopia, Senegal and Tanzania.
Ethiopia is one of the largest markets for Dangote Cement outside of Nigeria. The market remains short of supply as most plants are operating at very low capacity. Ethiopia's total market for cement was appproximately 2.7Mt in the first six months of 2022. Sales at the 2.5Mta factory in Mugher were at 1.1Mt in the 1H22, up one per cent YoY. Dangote estimates its market share to have been about 41 per cent during the period.
Senegal remains a top-performing market for the Nigerian company. Dangote estimates the total market sales to have been about 4Mt in the first six months of 2022. The market is expanding, supported by a growing middle class, growth in the construction sector and infrastructure projects across the country including low-cost housing projects. Dangote's 1.5Mta plant in Pout sold 643,000t in the 1H22. Production was constrained by extended power plant maintenance. Meanwhile, the Mali border closure and regional sanctions affected exports.
Tanzania is estmated to have had cement consumption of 3.3Mt in the first six months of 2022. Dangote’s 3Mta factory at Mtwara sold 944,000t of cement during the period, including clinker sales of 209,000t. This was approximately 19 per cent higher than in the 1H21. This was supported by the growing cement demand, improved sales and marketing efforts, and the continuous improvement of our plant operations. Dangote estimates its market share to have been 22 per cent during the period.
Other growing markets
Cameroon's market is a growing area, reaching just over 2Mt of cement demand in the first six months of 2022. A main feature is increasing clinker costs owing to the global rise in freight cost and overall global supply chain issues are challenging clinker supply. Dangote Cement’s 1.5Mta clinker grinding facility in Douala sold about 658,000t of cement in the 1H22, an eight per cent decrease on the 718,000t sold in 1H21. Dangote estimates its market share to have been 32 per cent during the period.
Ghana is benefitting from a stable political environment. However, there was a general reduction in government projects in the 1H22. Total market sales were estimated at 3.6Mt in the 1H22. Dangote Cement Ghana sold 117,000t of cement in this period.
Meanwhile, the total market for cement in Congo is much smaller at about 285,000t in the first six months of 2022. The company's 1.5Mta integrated plant in Mfila sold 196,000t of cement in the 1H22. This is due to limited production from the plant owing to extended maintenance, says Dangote.
Sierra Leone’s cement market continues to improve with increased infrastructure spending, road construction across the country and the resumption of building projects in the corporate sector. Sierra Leone consumed 513,000t of cement for the first six months of 2022. Volume is limited by supply and volatile shipping and cement cost.
Declning sales volumes
Dangote's sales volume faired less well in South Africa and Zambia. In South Africa for 1H22 decreased by 10 per cent. The YoY decrease is attributed to the recent energy crisis, massive fuel inflation, rising interest rates which place further pressure on discretionary income, hence the lower demand for cement.
The company's 1.5Mta Ndola factory in Zambia sold 276,000t of cement in 1H22, this lower volume was due to increased competition in the export market. Dangote’s market share for the first half of the year is estimated at 28 per cent. Dangote estimate the total market for cement in Zambia to have been 987,000t in 1H22.
