SEPHAKU Cement, an associate of listed Sephaku Holdings, has completed the commissioning of the Aganang clinker facility in Lichtenburg in the North West and is ready to commence with production.
Lelau Mohuba, the chief executive of Sephaku Holdings, said yesterday that the first consignment of clinker would be delivered to the Delmas milling plant by the end of this month.
Commercial production at its Delmas milling plant commenced in January following a successful commissioning phase. Once it is operating at full capacity, it will be capable of producing 1.4 million tons of cement a year.
About R3.3 billion has been invested in establishing these new cement plants, which will have a total annual capacity of 2.2 million tons once they are fully operational.
Sephaku Holdings has a 36 percent stake in Sephaku Cement, with the remaining 64 percent owned by Dangote Cement, Africa’s largest producer. Mohuba said that the production of its own clinker was an important step for Sephaku Cement in enabling it to become a fully integrated producer of cement.
“We are confident that it will soon become a strong and profitable competitor in the local market,” he said.
Mohuba said Sephaku Cement had to date been purchasing clinker to mill at Delmas where the company had achieved more than 60 percent capacity utilisation. He said this had enabled Sephaku Cement to enter the market while strengthening its sales function in preparation for increasing volumes.
Mohuba said consistent cement quality and exceptional service had enabled Sephaku Cement to successfully penetrate both the bag and bulk markets.
He said the targeted clinker production date at Aganang was the end of last month but the process had been slightly delayed because of minor problems identified on the plant fan system as part of the normal hot commissioning.
Aganang has an annual cement production capacity of about 1.1 million tons and the Delmas plant 1.4 million tons a year at a steady state. But Mohuba said that the ramp-up of production at both plants would be based on market demand.
Sephaku Cement is the biggest new entrant to the South Africa cement market since 1934.
A R1.8bn greenfields pure cement plant with a capacity of more than 1 million tons a year is to be built at an established limestone deposit near Northam in Limpopo by the Jidong Development Group, one of the largest enterprises in China’s building materials industry and one of the world’s top five cement groups.
The new entrants to the market led to Ketso Gordhan, the chief executive of listed cement and lime producer PPC, to claim in May that the domestic cement market was oversupplied.