Kenyan cement consumption grew 18 per cent in the half year ended June, driven by increased construction activities in the private sector that defied a surge in cement prices, according to Kenya National Bureau of Statistics (KNBS).

KNBS reports that 4.97Mt of cement were used in the six months from 4.06Mt consumed in a similar period last year. This was achieved despite a sharp rise in the retail price of a 50kg bag of cement which has risen by KES300 (US$2.48) since March on rising costs of raw materials.

Private sector construction projects have been picking up this year after being held up since 2020 due to the COVID-19 pandemic, which not only disrupted building sites due to movement restrictions but also caused a dip in demand for housing and office space as thousands of Kenyans lost their jobs.

In its half-year financial report released late last month, listed cement maker Bamburi Cement pointed to higher volumes in the period, which helped it grow its turnover by 2.6 per cent to KES20.1bn. “This was driven by volume growth along with improved average selling price compared to the prior year,” said Bamburi in the report. 

However, the firm pointed at headwinds in the form of higher imported input prices, which if persistent will likely not just affect the profitability of cement makers but also start to eat into demand due to high retailer prices.

The revival of private sector projects is timely for the cement firms now that major public infrastructure projects such as the Nairobi Expressway and the Mombasa bypass at Dongo Kundu, which have driven demand in the last few years, are either complete or nearing completion.