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New machinery is to be installed for the second 1.7
billion Br plant which the Mesobe Cement Factory
constructed beside the existing factory on the
outskirts of Mekele, the seat of the Tigray Regional
Government.
The money, 96 million in euro [141.6 million
dollars], has been obtained entirely as a loan from
the Development Bank of Ethiopia; only 15pc of this
money was required in local currency. The contract
to construct the plant and supply the machinery was
given to the Chinese Hance Cement Research and
Design Institute.
“The civil work has been completed. The machineries
are now coming from China,” said Brehanu Werede,
acting general manager of the project.
The new plant, expected to be completed by August
2010, will have a capacity to produce 1.2 million
tonnes of cement a year, up from the current
capacity of 630,000tn. The factory will also grind
3,000tn of clinker a day, 1,000tn more than the
existing plant. When the work is completed, Mesobe
will have equal capacity to Muger Cement Factory,
which is undertaking an expansion project.
Messobe, established in 2001, used to be one of the
two major suppliers along with Muger. It still is,
but its market share has been falling, following the
privatisation of the former Dire Dawa factory which
is now National Cement Factory. The introduction of
30 new cement factories, some of which have now
become operational, has contributed to the falling
of its market share. The factory’s website puts its
share of the market at 30pc.
The annual cement demand in the country is expected
to be six million to seven million tonnes, but the
supply, both from local production and imports, has
not exceeded 3.2 million tonnes.
The demand has been growing at an annual rate of
25pc due to extensive construction projects in the
public and private sector, including dams, roads,
and university buildings says the Ministry of Trade
and Industry (MoTI). The market had been compromised
because as demand increased; production cost at the
local market has also been growing.
Recently, the use of coal in furnaces has been
introduced as a cost cutting measure. Messobe has
been the first to start using coal last month.
The new plant will also be prepared to use coal in
its furnaces, Brehanu says. Muger, National and
Derba MIDROC cement factories are also showing an
interest in the cost-cutting measures of coal. The
coal is supplied by Ethiopac Coal Mining, which is a
joint venture established by Ezana and Messobe aloy
with Pakistani investors.
Ethiopia hopes to become a net cement exporter in
three years time when many more of the 30 companies
join the market, according to Shimelis Wolde,
director of Chemical Industry Directorate at MoTI.
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