The lime of the century

From its base in South Africa, the country’s leading agri lime company is looking to expand its interests in markets across the continent. TABJ looks at the success of SA Lime & Gypsum and its subsidiary Africa Lime Products to find out how it plans to build a continental empire.

With various lime and gypsum production sites across South Africa, SA Lime & Gypsum is leading the industry across Africa’s largest economy.

The company started trading in 2003 and, with its focus on agricultural lime and gypsum, has grown into the biggest agri lime company in Africa.

“We are the only nationally-represented lime company in SA and also the biggest in Africa,” declares director Hendrik Heÿl. “The company originally started in Cape Town and in 2004 began expanding across the rest of South Africa.

“We now have an agent network totalling 150 across the country and deliver products from logistically well-situated sources in every province,” he adds.

SA Lime & Gypsum, the brainchild of managing director Carl Taljaard, was founded with the help of co-owner Hendrik Heÿl, and quickly began to climb to the top of the ladder to ultimately become Africa’s biggest agricultural lime company. 

From industrial gypsum to neutralime, SA Lime & Gypsum supplies a variety of lime-based products.

The company’s current product portfolio and applications includes roadlime, an unparalleled aid in the modification and stabilisation of soil beneath road and similar construction projects, and quicklime, which is used in a wide variety of environmental and industrial applications. 

It also trades in waste treatment lime for wastewater treatment plants that is used as the chemical for correcting the pH balance of acidic waters, precipitating heavy metals, phosphates and its flocculating action.

Africa Lime Products, a subsidiary of SA Lime & Gypsum Group, was been established in 2008 and began trading in 2009 to act as the company’s vehicle to direct its expansion plans across the African continent.

The subsidiary, which started trading in 2009, specialises in the production and marketing of the full range of value-added calcium and magnesium products.
The company’s core business revolves around the chemically-driven lime cycle, and its key product, arsenal, is sourced, processed and distributed from strategic locations in close vicinity to its key markets.

“The formation of this company was a natural progression for our group, following the rich history of SA Lime & Gypsum, a market leader within the agri lime industry,” says Heÿl.

Competitive edge

The key competitive advantage SA Lime and Gypsum has is that its business strategy lies in the synergy between the agricultural and industrial lime markets, notes Heÿl.

“Most waste materials from the company’s industrial plants and other industrial sources, to which have exclusive access, are easily marketed and sold into the agricultural market,” he remarks.

“As far as forward integration is concerned, the company has been able to finance all capital requirements to date with internal funds,” he adds. “These include a lime hydration plant along South Africa’s western coast and a variety of mobile minerals processing and earth-moving modules.

“Various exciting opportunities currently exist in the lime industry, both in South Africa and on the rest of the continent.”

With stable economic and political conditions and its rich deposits of copper and cobalt ore, the company has selected Zambia as the platform for its future growth strategy into Africa and began trading in Zambia earlier this year. 

Having registered a wholly-owned subsidiary in Zambia and obtained the investment license required to start operations within the country, the company has appointed a team to look after its interests in Zambia and signed contracts with suppliers of limestone to ensure raw material security.

“In line with the company’s proven business model, the location of these sources has been strategically selected close key markets to provide a competitive advantage through the reduction or elimination high-transport costs,” remarks Heÿl.

“In January 2012 we will see the incorporation of Africa Lime Products (Mozambique) and we are currently busy finalising the takeover of a mine in southern Mozambique, as well as sorting out plans to establish new mines in other locations in Mozambique,” he adds.

Lime is fine

Heÿl says that the lime industry hasn’t been overly affected by the economic turndown that has caused havoc to so many other industries in the past few years.
“The agri business was not affected at all and we have maintained 35 per cent growth since the start of the recession,” he notes. “The industrial business also expanded dramatically during these years and we are happy to have a growing market share during tough times.

“Our planning in the next five years is aggressively towards Africa and we are already investigating opportunities in various new locations,” he remarks. “Growth in sales and profit has been exceptional and the firm supply contracts we have in place put the company in a very healthy financial position.”

From relatively healthy positions, SA Gypsum & Lime and Africa Lime Products are both looking to develop an expansion plan that will put the group on a platform to become a global player within the resource sector.  

www.sakg.co.za

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