A Ugandan galvanized wire manufacturing company that is setting up shop in Kenya says they will start operations in January.
The Sh2.5 billion investment was to start operations in August but was stalled by the Covid-19 pandemic.
“We brought in machines from Belgium, Italy and Germany, three countries that produce the best machinery when it comes to galvanized wire,” said Roofings Kenya Limited chief operating officer John Mucheru.
He spoke at the factory site in Mazeras.
Mucheru said the factory they are setting up in Mazeras, Kilifi county will be producing 4,000 metric tonnes of galvanized wire per month.
There is only one galvanized wire manufacturing company in the country at the moment which does not meet the country’s demand which is estimated at about 5,000 metric tonnes a month, which translates to about 48,000 metric tonnes a year.
Some two other firms have also applied for licenses to manufacture galvanized wire.
Kenya is currently importing most of its galvanized wire, which is what is used to make barbed wire, chain links, and in the cabling industry.
The government, as part of its plan to encourage and support the local manufacturing industry, part of the Big Four Agenda, in June introduced a 25 per cent excise duty to discourage importation of galvanized wire.
“The factory is essentially complete. We are almost proceeding to the stage of installing the machinery and by January we should be in production,” said Mucheru.
“We have also made inquiries for sending the same products to countries such as the US and Australia because we believe in the quality of what we can produce,” said Mucheru.
Manufacturers of barbed wires, chain link fences, gabion boxes and razor wires are, through the Kenya Manufacturers Association, have been lobbying for the reduction of the excise duty to 10 per cent to allow them easily import raw material.
There was an agreement between the National Treasury and local manufacturers to cushion them from imports on an understanding that there would be enough capacity to supply the raw material.
The only operational galvanized wire manufacturing company, based in Thika, has failed to meet the demand of the industry.
However, Mucheru said this is due to the disruptions caused by the Covid-19 pandemic.
“Like I said earlier, we were to start operations in August but then the Covid-19 came and we were forced to shut down all activities. This means we did not have any progress for three months,” said Mucheru.
He said already, they had imported 50 containers of machines used in the manufacture of galvanized wire.
He said the factory, which supports the manufacturing pillar of the Big Four Agenda, will employ at least 200 people from the locality.
“Having a local product means we will support import substitution because there will no longer be need to import products which makes us lose foreign exchange,” said Mucheru.
Roofings Kenya has a sister company in Uganda, Roofing Uganda Ltd, which has been making exporting to Kenya.
Mucheru said the team that is responsible for the manufacture of galvanized wire in Uganda will be the same that will be manufacturing in Kenya.