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Midlands Correspondent
GWERU-based cement manufacturer Sino Zimbabwe Cement Company (SZCC) sales for the first quarter have declined by 15 percent as compared to the same period last year. The company, a joint venture between the Zimbabwean and Chinese governments, has projected a further decline in sales this quarter citing a difficult operating environment that includes liquidity problems.
SZCC managing director Wang Yong told Chronicle Business that the situation has been exacerbated by the smuggling of cheaper cement mainly from South Africa.
“There has been a decrease in market demand particularly in the first quarter and the trend is replicating itself in the second quarter,” he said.
“Sales have dropped by 15 percent in the first quarter. The cash shortages in the economy and the funding challenges by financial institutions continue to be the major hindrance to the growth of the construction sector.
“The firming of the greenback against regional currencies has also had an effect on our sales as cheaper cement products are being smuggled into the country. We’re in constant discussions with the relevant ministries so that measures are taken to protect the local industry.”
Yong said the poor agricultural season has also negatively impacted on sales especially in Gokwe where there is a boom in sales during the cotton marketing season.
Despite the decline in sales, the company is continuing its vigorous marketing strategies and is now the dominant player in the Midlands where it has set up cement containers for its distribution agents.
Wang said the company has made inroads into the Harare market, the largest in the country, where it now commands a 20 percent market share while plans are underway to penetrate markets in Matabeleland provinces as well as Manicaland.
SZCC is the third largest cement producer in the country after Pretoria Portland Cement and Lafarge.
The Gweru-based firm produces 400,000 tonnes of cement per year and commands a 25 percent market share.
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