On Wednesday 10 September 2025 Afrimat hosted a site visit to its cement plant in Lichtenburg, North West. It was an informative visit which provided much-needed insight into Afrimat’s strategy for its cement business and a clear path to its recovery over the coming years.
The key takeaways from the visit will be discussed in more detail below, but some of the highlights are that Afrimat is one of the lowest-cost producers of cement in the country, and this is due to the vertical integration of all the cement ingredients. This is aided by the strategic location of its cement plant, grinding station and depot (which will serve as an additional blending plant from mid-October 2025). In aggregate, this could translate to c. 3mtpa of cement at a clinker factor of 50%, however, many of Afrimat’s products use much less than that.
While the outlook for the turnaround of the cement business is very positive, there are some risks for the group. First is the impact that the shutdown of the blast furnaces in SA could have on Nkomati. Afrimat can export 250 000 tonnes of anthracite, but that is c. 150 000 tonnes less than it was able to sell in the past, and exporting through Maputo has proved to be challenging. Second is the shutdown of AMSA’s Longs business, which has again brought into question the viability of AMSA as a whole and highlighted Afrimat’s client concentration. Third is Glenover, which continues to struggle to deliver returns, and the rare earths business is five years away from a solution.
Despite the negatives surrounding those business units, there are many other positives. The sale of iron ore to Newcastle was a bonus, and its closure is not expected to significantly impact volumes. Furthermore, because Afrimat and AMSA are so dependent on one another, especially due to the new slag JV, the companies have a vested interest in keeping each other afloat. Another positive is that in c. 6 months’ time, Afrimat expects to receive an export rail allocation of 2 – 3mtpa (0.87mpta currently), which will remove the dependence on AMSA and allow AMSA to make headway on its plan to switch to electric arc furnaces. Lastly, while the cement business is now profitable, the quarries and fly ash businesses could contribute an additional R50m – R100m operating profit in FY26. If the cement business breaks even, that could result in a R350m to R400m swing in operating profit.