Sunbird’s Local Clinker Production Could See Uganda’s Cement Costs Drop

Sunbird's Byona (3rd L) receives the license from Nankabirwa and Lokeris (2nd R) as other officials look on

Cement prices and construction costs in Uganda in general are likely to drop significantly once Sunbird Resources starts production of clinker in Karamoja, next year, Ambrose Byona, the company’s managing director has said.

Byona was speaking at a press conference to announce the granting of a large scale mining license to Sunbird by the Ministry of Energy and Minerals Development, on Thursday, February 22, 2024.

The 21-year mining license (which was granted on January 21, 2024) spans an area of 11sqkm in Rupa, Moroto, where Sunbird will be expected to mine 8,000 tonnes of limestone containing clinker per day.

Incorporated in 2015 to carry out the business of exploration and mining of minerals in Uganda, Sunbird Resources discovered over 67 million tonnes of limestone after completing systematic exploration work over a six (6) year period.

“Sunbird will be the first company to produce clinker in Uganda, which will help cement producers lower their import bill. Since clinker makes up about 80 per cent of cement, we will be a game changer in the cement industry,” Byona said.

A tonne of imported clinker currently costs about $155. Byona believes the Sunbird produced clinker will cost at least 40% less (about $93). A bag of cement on the other hand currently averages between Shs 32,000 to Shs 36,000.

In September, 2023, President Yoweri Museveni broke the ground for Sunbird’s construction of a 6,000 tonnes per day clinker production line and a one million (1m) tonnes per year cement factory at Nadunget, Moroto.

President Museveni breaking the ground at the Sunbird plant site

The project will cost $300 million in total, with test runs on the plant scheduled from March to May, 2025, before production starts later in July.

Sunbird’s partners West International Holdings (WIH), a subsidiary of West China Cement, a Hong Kong listed company (stock code: 2233.HK), an international enterprise integrating cement production and marketing, corporate management and industrial investment, which holds 80% shareholding in the conglomerate, will carry the bulk of the financial weight.

Enjoying a 30 year experience in cement production in China, WIH already has an African presence, with cement plants in Mozambique, DR Congo and Ethiopia.

Tang Shengui, the General Manager at WIH, promised numerous jobs and various other social support projects for the host community of Karamoja.

“This factory, on completion aims to be the largest cement factory in the country, creating huge employment opportunities for Ugandans – about 600 direct and 3,000 indirect employees. It will also provide import substitution for the 2.4 million tonnes of clinker imported annually at a cost of over $700m,” said Ruth Nankabirwa, the Minister for Energy and Mineral Development.

Adding, “Limestone is a crucial raw material for making of clinker that is finally used in the manufacture of cement. This will culminate into royalty payments to the Consolidated Fund of over Shs 160m per day of operation.”

Map of the Karamoja region

Peter Lokeris, the State Minister for Mineral Development, hailed Sunbird for going against the norm, to set up a factory in Karamoja unlike many that have opted to carry the ore from the mineral rich region to plants elsewhere in Uganda or exported it.

“Sunbird is the first company to establish a minerals related factory in Karamoja, therefore fulfilling President Museveni’s wish for value addition to the country’s minerals. We will continue to support these kind of developments like we have done in extending high voltage electricity to the region. This, we believe will guarantee numerous multiplier benefits for the community overall,” Lokeris, also the Parliamentary representative for Chekwii County of Nakapiripirit district in Karamoja, added.

Asked whether Hima Cement, one of the largest cement producers in Uganda, would switch to locally-sourced clinker once the Nadunget plant is up and running next year, a company official who preferred anonymity said it was still too early to predict Hima’s procurement plans.

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