Have Dangote Cement’s pan-African operations plateaued as Chinese competition grows?
In 2024, Dangote Cement soared past the N1trn ($649.8m) profit mark in its home market – a 110% jump from the previous year – thanks to strong domestic sales and rising prices.
At the same time, its pan-African operations, spanning nine other countries, posted a larger net loss of N24.37bn, but still accounted for about 30% of the company’s business. Overall, group earnings rose by 10.5% to N503.2bn, with total sales volumes at 27.7 million tonnes per annum (Mta).
From Senegal and Ghana to Ethiopia and South Africa, the map below shows, country by country, the volumes produced by the Nigerian company as well as those of its main competitors.
The African cement market has undergone seismic shifts over the past decade, with a dramatic increase in the number of producers and an equally noteworthy drop in cement prices.
Fragmentation remains a hallmark of the continent’s industry: capacity has climbed faster than demand, and local price variations persist, especially in landlocked countries where transport costs are high.
Dangote Cement is the leader in only two of its foreign markets – the very small Sierra Leone market, and East African powerhouse Tanzania.
Strong in Nigeria, expanding abroad
Dangote derives much of its revenue from Nigeria, where it sold 17.7Mta and posted a 69% jump in revenue to N2.19trn in 2024. Sales outside Nigeria dipped slightly – by 1.1% – to 11.13Mta, largely due to factors like adverse weather in Tanzania, election-related slowdowns in Senegal and South Africa, and security issues limiting coal supply at its 2.5Mta Mugher plant in Ethiopia.
Despite these challenges, Dangote is pushing forward with new ventures. In Côte d’Ivoire, a 3Mta plant is nearing completion, with the first 1.5Mta module due online this year, and Ghana’s 0.45Mta plant launched in 2023 is ramping up production swiftly. Ethiopia, too, is a major focus, with plans to add a second production line and a 3Mta greenfield grinding unit to meet growing local demand.
Competition from Chinese players
While Dangote continues to grow, Chinese companies are gaining a foothold in Africa’s cement industry – propelled into Africa by overcapacity at home.
West China Cement and Huaxin have made significant acquisitions, including Lafarge Africa in Nigeria and Cimenterie de Lukala in Democratic Republic of Congo. Dangote’s leadership, however, remains confident in its ability to hold market share, pointing out that it has successfully faced Chinese rivals elsewhere on the continent.
Future outlook
Analysts expect Nigeria – the company’s home base – to maintain robust cement demand, driven by infrastructure projects and real estate development. Across Africa, Dangote is betting on rising demand in diverse markets, as well as its ability to adapt to local challenges. Already commanding considerable shares in Tanzania, Senegal, Cameroon and Ethiopia, the firm appears positioned to consolidate.
(The Africa Report)
