🏭 Egyptian cement has evolved into an export powerhouse, transitioning from a domestic construction staple into a vital generator of hard currency. As local production surpluses expand and operational efficiencies improve, companies are aggressively broadening their international footprint. This shift is reshaping the Egyptian industry following years of supply gaps that were finally closed last year.

Egyptian cement exports saw significant growth in February 2026, with volumes rising 8.4% y-o-y to some 1.9 mn tons from 1.75 mn tons, according to aggregate market data seen by EnterpriseAM. Revenue followed suit, reaching roughly USD 82 mn versus USD 79.6 mn in February 2025. This 3% uptick comes despite fluctuations in global pricing. Overall production climbed to 5.8 mn tons from 5.15 mn tons a year prior, representing a 12.5% annual jump supported by stable energy supplies and a manufacturing pivot toward alternative fuels.

So, what changed? Just a year ago, Egyptian cement producers were primarily focused on absorbing cost shocks triggered by rising energy prices and exchange rate volatility. With energy accounting for 50-60% of production costs per ton, margins remained under heavy pressure throughout 2024 and early 2025. By 2026, however, investments in alternative fuel mixes began to pay off. Factories expanded their use of industrial waste, refuse-derived fuel, and coal, which helped stabilize production costs and allowed firms to maintain operational margins. Analysts at Al Ahly Pharos and HC Securities believe this shift was more than a cost-cutting measure — it fundamentally altered the sector's entire strategy.

For years, the Egyptian cement sector has grappled with a massive production surplus estimated at 15-20 mn tons above domestic needs, according to Ahmed Shireen Korayem, head of the Cement Division at the Federation of Egyptian Industries. Rather than scaling back, companies transformed this surplus into an export window. This explains the rise in production to 5.8 mn tons in February 2026, as an increasing portion of output is now channeled to approximately 100 foreign markets. Research from Al Ahly Pharos suggests the sector is gradually decoupling from local demand cycles to become more reliant on regional and international markets.

The export surge is not just about volume, but also product composition. While exports were previously dominated by clinker, the share of finished cement and higher-value-added products has recently increased. In February 2026, finished cement exports reached 1.2 mn tons, compared to 700k tons of clinker, a shift analysts say enhances the value added per exported ton. Additionally, some companies have begun expanding production of low-carbon cement, a move intended to give Egyptian products a competitive edge in markets moving toward stricter green regulations, particularly European markets.

This pivot serves as a hedge against any potential domestic construction slowdown. With local demand currently driven by national projects — accounting for 62% of consumption — exports provide a safety valve. They also provide listed companies with a source of foreign currency revenue, which was reflected in several firms’ balance sheets over the past year, according to Al Ahly Pharos and HC Securities analysts.

The government stepped in to ensure domestic price stability. In October, an exceptional incentive was introduced for manufacturers who increase supply for the local market, offering temporary markdowns on administrative fees for modifying production capacities. This followed a July mandate giving factories one month to restart idle production lines to meet local demand. Since the abolition of the quota system in May 2025, cement prices have stabilized near USD 81 per ton (EGP 3.9k), up from USD 50 per ton (EGP 2.1k) a year ago, with consumer retail prices holding between EGP 4-4.2k per ton this month.

Factories are currently building inventories in anticipation of the spring construction season. Cement stocks rose to around 4.2 mn tons by the end of February 2026, a 5% increase from the 4 mn held during the same period last year. This increase reflects corporate readiness for seasonal demand and government efforts to balance domestic supply with export requirements, Korayem tells us.

This has boosted the performance of cement stocks on the EGX, with several companies reporting notable growth in 2025. Arabian Cement saw strong earnings driven by efficiency gains, while Misr Cement Qena benefited from its proximity to export markets in Sudan and East Africa. Sinai Cement was back in the green following a debt restructuring, and Misr Beni Suef Cement maintained its investor appeal through stable production and dividends. While South Valley Cement continues to report losses, it has managed to narrow them significantly amid ongoing development plans.

(** Tap or click the headline above to read this story with all of the links to our background as well as external sources.)

Tags: