Karen Harverson
Anglo Alpha may set up a cement factory in Namibia to protect its stake in the 200 000-ton Namibian cement market from Malaysia, which is also considering investing in a factory there.
However, the Namibian factory is just one of three options Anglo Alpha is considering to expand its cement-producing capacity, says managing director Johan
The other options are a new multi-million-rand factory at Saldanha Bay and a R500-million new kiln for an existing cement plant in Dudfield in Lichtenburg in North-West province
A final decision on which option or combination of options Anglo Alpha will take will only be made in the first quarter of 1996.
The company’s interest in a new plant at Saldanha Bay stems from the fact that rival cement-producer PPC has a monopoly in the Western Cape. But, says Pretorius: “There will also be slag available from the new steel plant which would reduce the cost of cement
A factory at the coast would also enable the cement producer to supply export markets up the coast of Africa and the Indian Ocean Islands. “At the moment we can’t compete in export markets because of the great distance between our production facilities and the ports,” says Pretorius.
Anglo Alpha is involved in a R120-million lime expansion at Ouplaas, in the Northern Cape, where a new lime kiln is being installed to replace an older kiln and increase capacity. This will be completed by the end of 1996.
At present, the company has a 35 percent share of the local market, PPC has 45 percent and Blue Circle has 20 percent. These three companies have been part of a long-standing cement cartel which was told to dismantle last year by the Competition Board.
Pretorius says the cartel has until October 1996 to dismantle. “The Cement Distributors of South Africa — the marketing body for the three producers — is almost disbanded and each company has taken over its own marketing and invoicing operations.”
He says there is little danger of price wars occurring between the three producers to gain market share. “Common sense will prevail.”