Local cement manufacturers plan to phase out their reliance on imported coal contingent upon the improved quality of locally produced supply. The move comes as a month-long collaborative study with the Ministry of Mines nears completion.

Senior management from the 12 operational cement factories sat down with Habtamu Tegegn, minister of Mines, three weeks ago. A team of experts then, including representatives from industry giants Derba, Dangote, Muger and the Ministry, conducted an assessment of local coal-producing regions. Their focus was on calorie generation, moisture and sulfur composition to identify supply chain gaps and meet the increasing demand of manufacturers. The effort aims to contribute to the national strategy that ensures sustainable and better quality supply locally.

According to Adugna Bekele, president of the Ethiopian Cement Association, an immediate shift from imported coal is impractical. Instead, he advocates for a gradual reduction while concurrently improving the quality of locally produced alternatives.

"Quality will be the deciding factor," said Adugna, pointing to the importance of adopting coal-washing technologies and establishing industrial-scale processors.

While the 16-member strong Association leader recognises low-quality coal as one of the reasons for the underwhelming production of cement, he suggested that several supply chain problems have colluded to undermine the cement supply.

"Poor quality coal damages machinery," he said.

The quest for local coal self-sufficiency gained momentum under the tenure of former Minister Takele Uma, who granted eight large-scale coal mining licenses. However, only MIDROC and Yo Holding remain operational, raising challenges in meeting local demand despite Ethiopia's substantial coal deposits. While Ethiopia has an estimated 600 million tons in coal deposits, the few industrial-scale miners that have existed since exploration began in the 1940s have never met local demand.

State Minister for Mines Million Mathewos stressed the imperative of locally sourcing coal to curb the 300 million dollars spent annually on imports. He acknowledged that the proliferation of small-scale mining has resulted in an oversupply of low-quality coal in the market.

"We have to improve quality," he told Fortune.

The Ministry has taken decisive steps, with Million stating that no more small-scale coal mining licenses will be issued without a corresponding washing facility. The most impacted ones are cement factories which source 90pc of their energy from coal. A ton of cement needs between 200-450Kg, while steel, chemical and textile industries also use it for their energy needs.