Chinese cement manufacturers pour into Africa
A stagnant Chinese market and Africa’s growing demand for infrastructure are driving Chinese cement producers to the continent.
The rise in Chinese cement factories across Africa is an indisputable trend. In 2023, we tracked nine new Chinese-invested cement projects in Africa, and another five in 2024 so far.
The divergence between China’s and Africa’s economic conditions are driving this surge in cement investments. Domestically, the Chinese property market remains stagnant, with consumption of cement at 60 million tonnes per year against a production capacity of 130 million tonnes. This imbalance increases bankruptcy risks for producers without strong export markets. Stringent environmental policies in China further discourage local cement production, incentivizing firms to relocate operations abroad.
The overall result is Chinese firms are actively seeking high-margin opportunities abroad. Africa’s growing demand for infrastructure aligns perfectly with this need.
While China’s domestic cement prices fell to $41/ton in 2023, Africa’s rose to $111/ton in key markets like Ethiopia and DRC.
Moreover, by some estimates, Africa’s cement market is projected to grow from approximately $35bn in 2024 to around $42bn by 2030, with a compound annual growth rate (CAGR) of 4.7% during this period. By contrast, China’s share of global cement production is expected to decrease from over 50% in the early 2020s to about 35% by 2030.
The growth in cement needs is due to a continuing construction boom on the continent – fuelled by rapid urbanisation, population growth, and infrastructure gaps. Countries like Ethiopia, Mozambique, and Rwanda are experiencing significant demand for cement to support roads, bridges, and housing developments. These trends align with broader objectives under the African Union’s Agenda 2063, which emphasizes industrialisation and large cross-border infrastructure projects.
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Source: https://african.business/2024/12/trade-investment/chinese-cement-manufacturers-pour-into-africa
