Manu Chandaria a multi-millionaire and manufacturing magnate is not a new name to us, not when most of products we use come from his company.
Manu Chandaria is the founder and chairman of the Safal Group, Africa’s largest steel roofing provider, operating in 11 countries on the continent. Mabati Rolling Mills, founded in 1961, is the company’s flagship business, and their main plant is in Mombasa.
Chandaria tells ‘Marketplace Africa’: “Steel is cheap enough, affordable enough, and attractive enough, for the people to buy”.
He explains the origins of the company’s steel production: “We went to Japan, we started looking at the plants over there. And then we decided we will take a small unit galvanising line. And as soon we started to manufacture we felt wow, this can be replicated, duplicated, so we decided let’s put it in more countries. So we put it Tanzania, Ugandan, Zambia, in West Africa. So we knew that things were multiplying. And the requirements for every society was almost the same.”
Kenya does not produce its own raw steel, so Mabati Rolling Mills imports it in coils mainly from Japan, one of the biggest producers in the world. It is then put through a process that turns the raw steel into iron sheets, which are then cut and moulded into the desired lengths and shapes.
In Nairobi, ‘CNN’s Marketplace Africa’ meets Stephen Oundo, a practising architect and chairman of the National Construction Authority, a new state corporation that was formed to regulate the industry in Kenya.
Oundo tells the programme: “The use of corrugated iron sheets is widely used in this country, in rural houses, in schools. The advantage is because they are lighter it means the roof structure does not have to be as heavy, so there will be an overall cost saving on the building.”
He goes on to outline the social benefits of producing corrugated steel: “Ten years ago the statistics were that we had a demand of housing of about 200,000 a year and in the market we were only able to do about 30,000… Now what are the challenges in being able to meet this deficit? The general one is the cost of construction right now. And one of the ways of finding workable solutions to be able to address the shortage of housing is to come up with appropriate technology and materials that are able to suffice.”
Mabati Rolling Mills say the growing demand in corrugated iron has led to a rise in the output from the Mombasa plant. Manu Chandaria tells the show: “I think we started with twenty thousand tons, today we are manufacturing 140 thousand tonnes a year, and as a business we want this year…we are planning…half a million tons of steel.”
In the last few years, Mabati Rolling Mills have changed the methods of processing their iron sheets. Chandaria tells ‘Marketplace Africa’: “We found out that the galvanising business that we have done, it’s already archive now, it’s already 30 or 40 years now. We need something new now. And at that time we found out that the aluminium galvanized sheets out of zinc – with zinc and aluminium, gives four times the life of an ordinary sheet. So we decided to move from galvanizing, into alu-zinc. And once we got into alu-zinc, we also decided simultaneously, colour coated.”
Colour coating their sheets is one of the main reasons Chandaria attributes to their growth: “There are many countries that don’t manufacture coloured sheets. We send it to surrounding countries. And as far as these markets are concerned I think that even today we are going through a major expansion. Our colour line cannot cope. So we are quadrupling our capacity. Because we see now, every sheet that we sell, 75% will be colour. It’s a growing market. There are five other manufacturers. As a matter of fact it’s growing so fast it’s unbelievable, and as we see the development in the country going up.”
He firmly believes competition is a good thing: “Competition keeps you on your toes. It makes you think twice how you will continue with that market share. It’s not that easy. But if there is no competition you will be lazy and lousy. To be lazy and lousy is the easiest way to be, but to be on the top, on your toes all the time, is most difficult.”
Stephen Oundo has a positive outlook on the future of the steel industry: “I see a lot of potential within the steel sector in terms of roofing materials because of the speed of erection, because of the simplicity of installation.”
As the need for corrugated iron in Kenya remains strong, Chandaria believes innovation is important to remain at the forefront of the steel roofing industry. In the future, he wants clients to customise orders according to their needs: “They will come and say they want 11 feet and 3 inches. And they will get 11 feet and 3 inches. They don’t have to only take 10 feet, or take 5 and 6 and overlap it. If they want exact, they will get exact. They like the colour, they see for themselves, I like this, and they will get. And then a little more job creation at that level.”
He remains optimistic about the future, concluding to ‘Marketplace Africa’: “I think overall all the basic industries, cement, steel, steel for structures, for sheeting, for packaging, it’s always going to rise. These are one of the common requirements. More population, more food is needed, more houses are required, so to us I think it’s a growth industry.”
‘CNN Marketplace Africa’, Friday 24 April at 1815 on CNN International
The show also airs at the following times:
Saturday 25 April at 1800
Sunday 26 April at 0300 and 0915
Monday 27 April at 0400 and 1930
Tune in to CNN on DStv Channel 401.
