Egypt’s cement industry has been on a path to recovery over the past few years, with company earnings improving, particularly over the last year. In 2025, industry players expect production, local sales, and exports to grow, supported by the reinstatement of the 2008 Building Law and an expected surge in demand. Additionally, Egypt is set to play a key role in reconstruction efforts in several Arab countries — likely to further boost our local cement industry.

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Breaking down the industry: Despite boasting an annual production capacity exceeding 90 mn tons, local production of cement has never reached full capacity, with production surpassing 56 mn tons prior to 2016 before declining to a low of 43 mn tons in 2023, according to central bank data seen by EnterpriseAM.

Last year, however, has seen production near previous levels: Cement output in Egypt rose 9.5% y-o-y to 55.1 mn tons in 2024, up from 50.3 mn tons the previous year, according to data obtained by EnterpriseAM from cement companies. This represents a nearly 24% jump from the five-year average between 2019 and 2023, which stood at 44.6 mn tons, according to EnterpriseAM calculations using official data from the Central Bank of Egypt.

EXPORTS ARE DRIVING THE TREND-

Exports have been the primary driver behind the production increase in recent years, an industry insider told EnterpriseAM. “Over the past three years, companies have ramped up their export efforts. This was in parallel with Egypt’s ongoing FX crisis, as many cement producers are foreign investors seeking to retain USD revenues,” the source explained. In 2024 alone, cement exports totaled approximately 19.7 mn tons — more than tripling from 2021 levels, when only 6 mn tons were exported. The past three years have also seen a significant shift toward exporting finished cement products.

Export volumes in the past three years have exceeded initial targets, a source at the Federation of Egyptian Industries’ building materials division told EnterpriseAM. In 2024, the sector had aimed to export 15 mn tons — up from 12 mn tons in 2023 — but actual exports surpassed expectations by more than 30%, driven by strong demand from neighboring countries.

Revenues have been slower to rise: Despite the surge in exports — rising by over 220% in the past three years — revenue gains have been more modest, rising only 96% to USD 913 mn in 2024 from USD 465 mn in 2021, according to data from the Export Council for Building Materials seen by EnterpriseAM.

Sector insiders expect demand to grow: Farouk Moustafa, managing director of Misr Beni Suef Cement, told EnterpriseAM he expects demand to grow by 10-15% this year, both domestically and internationally, signaling a continued industry recovery. Regional reconstruction projects are expected to play a key role in this, with rebuilding efforts in Libya — which is on the verge of an economic revitalization — as well as in Iraq and Gaza set to strengthen demand.

How much cement are we talking about here? It’s not yet entirely clear, but since the beginning of 2025 cement factories have already received export orders totaling 1.3 mn tons from Syria, Libya, and Iraq, a source at a production facility told EnterpriseAM.

Libya and Palestine were among the top five export destinations for Egyptian cement in 2024, ranking first and fifth, respectively. Cement exports to Libya grew more than 70% y-o-y to USD 150 mn from USD 87 mn, while exports to Palestine rose 57% y-o-y to USD 48.5 mn from USD 31 mn, according to the Export Council for Building Materials. African markets have also been major buyers, with Ivory Coast and Ghana ranking second and third, respectively, generating USD 132 mn and USD 123 mn in cement export revenues last year.

Israel recorded the biggest growth in imports: Egyptian cement exports to Israel skyrocketed by more than 16x in 2024, reaching USD 66.2 mn from just USD 3.8 mn in 2023, according to the Export Council for Building Materials.

INDUSTRY RECOVERY COULD CALL FOR A REGULATORY RETHINK-

Regulatory changes supporting demand: The Madbouly government recently announced measures to ease construction permit approvals, particularly for individual builders who represent a major segment of the market. This follows years of strict regulations and includes the reversal of the 2021 urban planning restrictions, with the country now reverting to the 2008 Building Law, according to Moustafa. The sum total of recent developments is rising gains for cement companies, which follow years of financial losses due to reduced production and lower utilization rates that eroded investment returns, he said.

Rising prices have bolstered industry sentiment: Factory-gate cement prices in Egypt started at EGP 3.2k per ton in 2025, having surged more than 270% since July 2021, Mahmoud Mukhaimar, head of the Alexandria Chamber of Commerce’s cement division, told EnterpriseAM. Cement factories helped bring about the price increase by leveraging a 2021 decision by the Egyptian Competition Authority allowing them to cut local production, with the restriction extended for a fourth year in October.

Despite their efficacy in the previous period, production restrictions may no longer make sense for the sector, Mokhaimer told us. He believes that the restrictions should be lifted in light of higher demand, in order to prevent further price increases and to protect consumers. Such a move would largely benefit domestic consumers of cement, since the production cap applies only to the domestic market and factories have more leeway to boost exports at the expense of local supply.

Indeed, a mismatch between supply and demand has been both pushing up prices and causing shortages. A cement distributor told EnterpriseAM that price hikes have often pushed cement beyond cost levels since the production cap was introduced in 2021. Prices rose to EGP 1.3k per ton in the first year of the cap, then jumped to EGP 2k in the second year, and EGP 3k in the third. At times, prices even exceeded EGP 3.3k per ton. In November 2024, cement prices temporarily reached EGP 5k per ton in some governorates, including Kafr El Sheikh, Alexandria, and Beheira, due to a construction boom in those areas. Factory supply delays have become increasingly common, with orders that previously took less than a day to be fulfilled now taking up to a week, fueling further price hikes, the distributor noted.

Further policy changes could boost the sector even more: Tax reductions or exemptions on cement exports would improve Egypt’s competitiveness in foreign markets, Moustafa noted, particularly after export subsidies were removed under the latest export subsidies program. Some commercial players, on the other hand, welcomed the removal of subsidies, noting that cement producers sell at a maximum of USD 50 per ton abroad, compared to EGP 3.5k per ton for domestic buyers.

Your top infrastructure stories for the week: Construction work on the 1.7k km road connecting Egypt, Libya, and Chad is underway, starting with the 400 km section within Egypt’s borders, according to a Transport Ministry statement. An MoU has been signed between Arab Contractors and the Libyan government for studies and initial designs of the 390 km Libyan section, as well as a similar agreement with Chad for the 930 km from Libya to Chad.

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