East African Portland Cement (EAPC) has resumed full clinker production after spending Sh500 million on upgrades at its Athi River factory whose frequent breakdowns had affected supply of its products in the market.
EAPC said it cut out 16 metres of its kiln's shell and replaced it with a new one, which will allow for the steady production of the key cement ingredient and reduce dependence on imports or purchases from fellow manufacturers in a market where local supply is inadequate to meet demand.
The company said it will now be able to produce its cement at a cost that will allow it to compete favourably with rivals in the price-sensitive segment.
“We want to give an assurance to customers that the company is now fully back to operations and that Blue Triangle Cement orders will be serviced within the agreed turnaround times in line with the Customer Service Charter,” said the firm's managing director Oliver Kirubai.
"We have already started producing our own clinker after an upgrade of our kiln. With the upgrade, we expect improved plant reliability and an output increase of almost 50 percent.”
Cement making involves mixing of clinker, a key raw material made from limestone or coral mainly from the Coast, with pozzolana, an ash-based product found in the Rift Valley.
Local cement firms have been ramping up their clinker production in recent years in order to cut a supply deficit, and also gain a competitive advantage by acquiring the key component at a lower cost.
They are expected to expand their clinker plants capacity by 4.4 million tonnes per year, bringing the industry’s production capacity to 10.7 million tonnes by 2025.
EAPC has, however, suffered years of neglect from legacy problems of under-investment and cash flow constraints that have cut production and lost its market share.
EAPC’s sales revenues have been squeezed by low sales volumes on account of constrained plant and intensified competition from new and existing players who produce at higher efficiency.
The firm’s turnover fell from a high of Sh6.9 billion in 2017 to Sh2.7 billion in 2021, pushing up operating losses from Sh1.3 billion to Sh3.2 billion.