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- In October, National Treasury issued a circular requiring bids for government projects to include a condition that only locally produced cement be used.
- The prohibition came as the industry’s calls for protection against cement dumped from mainly from Asian countries continue.
- PPC CEO Roland van Wijnen says cement cement dumpers use freight trucks on backhaul routes from Asia to Africa.
PPC CEO Roland van Wijnen has welcomed government’s move to block the use of imported cement on state projects, but he said dumping continues to be a threat.
In October, the National Treasury issued a circular requiring bids for government projects to include a condition that only locally produced cement can be used. The prohibition came as the industry’s calls for protection against cement dumped from mainly from Asian countries continue.
"For every bag of cement that is not produced locally, a local producer is unable to contribute to the communities in which they operate. For each bag that is imported a local producer is unable to pay taxes that help to drive society," Van Wijnen told shareholders on Tuesday.
Van Wijnen explained that dumpers use freight trucks on backhaul routes from Asia to Africa.
"As a temporary resident of South Africa, it pains me to see that we are not doing the maximum to bring South Africa to the next level that it so much needs," said the CEO, who has held positions in countries such as the Philippines and Switzerland.
In an interview after PPC’s interim results presentation, Van Wiljnen said the group was working against the tide of cheap dumped cement by controlling its cost properly, staying competitive and convincing customers of the value of reliable supply, since imports come and go.
"But obviously if you face the dumping, it is very difficult for an individual company to come up with a long lasting defence," he said, explaining that PPC was working with industry association Cement and Concrete SA and government agencies to level the playing field.
The group reported that its revenue increased by 20% to R5.1 billion in the six months ended 30 September 2021. Its earnings rose by 13% to R945 million and basic headline earnings per share jumped by 83% to 55 cents.
The company is recovering from a tumultuous period, when its R5.8 billion debt threatened to sink it. The group has since managed to avoid a R750 million rights issue and ink a deal with lenders in the Democratic Republic of the Congo, who removed their legal recourse for PPC’s South Africa operations.
With that chapter closed, PPC, like many companies in South Africa’s construction sector, is looking at government infrastructure projects for growth.
"We see it coming, slowly and steadily, it’s not just a matter of actually getting it massively into the ground. If you look at our customers, if you take the order books of some of the Sanrals [and] the Raubexes - all the indications are that the demand … is coming," said Van Wiljnen about the progress of the government’s rollout.
