CONTENTS
PAGES
I. INTRODUCTION
1
1.1. BACKGROUND
1
1.2. OBJECTIVE OF THE STUDY
2
1.3. SCOPE OF THE STUDY
2
1.4. METHODOLOGY
3
I.4.1 DATACOLLECTION
3
II. IDENTIFICATION OF PROJECT IDEAS
4
CLASSIFICATION OF PROJECT IDEAS
4
LIST OF PROJECT IDEAS
5
III. DESCRIPTION OF PROJECT IDEAS
6
1. SPONGE IRON MANUFACTURING PLANT
6
PRODUCT DESCRIPTION AND APPLICATION
6
MARKET STUDY
7
RAW MATERIAL
8
TECHNOLOGY
9
ENVIRONMENTAL IMPACT
11
2. STEEL BILLETS, SLAB AND BLOOM MANUFACTURING PLANT
13
PRODUCT DESCRIPTION AND APPLICATION
13
MARKET STUDY
14
RAW MATERIAL
15
TECHNOLOGY
15
3. STRUCTURAL STEEL MANUFACTURING PLANT
16
PRODUCT DESCRIPTION AND APPLICATION
16
MARKET STUDY
17
RAW MATERIAL
18
TECHNOLOGY
18
4. SEAMLESS PIPE MANUFACTURING PLANT
20
PRODUCT DESCRIPTION AND APPLICATION
20
MARKET STUDY
21
RAW MATERIAL
22
TECHNOLOGY
22
1
5. ALUMINUM EXTRUSION MANUFACTURING PLANT
23
PRODUCT DESCRIPTION AND APPLICATION
23
MARKET STUDY
23
RAW MATERIAL
25
TECHNOLOGY
36
6. ALUMINUM FOIL MANUFACTURING PLANT
27
PRODUCT DESCRIPTION AND APPLICATION
27
MARKET STUDY
27
RAW MATERIAL
28
TECHNOLOGY
29
7. BALL BEARINGS MANUFACTURING PLANT
30
PRODUCT DESCRIPTION AND APPLICATION
30
MARKET STUDY
31
RAW MATERIAL
32
TECHNOLOGY
33
8.
ELECTRIC
MOTORS,
GENERATORS
AND
TRANSFORMERS
MANUFACTURING PLANT
35
PRODUCT DESCRIPTION AND APPLICATION
35
MARKET STUDY
35
RAW MATERIAL
37
TECHNOLOGY
38
9. SUBMERSIBLE PUMP MANUFACTURING PLANT
38
PRODUCT DESCRIPTION AND APPLICATION
38
MARKET STUDY
39
RAW MATERIAL
40
TECHNOLOGY
40
10. LINK CHAIN MANUFACTURING PLANT
41
DESCRIPTION AND APPLICATION
41
MARKET STUDY
42
RAW MATERIAL
42
TECHNOLOGY
42
2
11. BAKING OVENS MANUFACTURING PLANT
43
PRODUCT DESCRIPTION AND APPLICATION
43
MARKET STUDY
43
RAW MATERIAL
45
TECHNOLOGY
45
12.NON-THREADED MECHANICAL FASTENERS MANUFACTURING PLANT
45
PRODUCT DESCRIPTION AND APPLICATION
45
MARKET STUDY
46
RAW MATERIAL
47
TECHNOLOGY
47
3
I.
INTRODUCTION
1.1. BACKGROUND
Being a developing country the Economic growth in Ethiopia is steel intensive. The
annual per capital steel consumption in Ethiopia is 12kg1, which is very low as
compared to even some African countries like Kenya which is 65kg or African average
which is 42.5kg and by far low when compared to the world fastest growing economy
china which is 132.2kg.
The metal industry is found at very low stage of development; but is having a substantial
growth. The range of products manufactured in this sector includes galvanized roofing
sheets, pipes, reinforcement bars, nails, window and door frames, trusses, hand tools,
implements, pumps, and various metal fabrications. In addition to the above products,
there also exist a couple of plants assembling automobiles, trucks and tractors. There are
also some industries which produce hand tools spare parts and cutleries.
During the last five years, the demand for metal products in Ethiopia has increased
significantly due to large government projects such housings, schools and roads.
Although there are some industries that are involved in the production of steel sections
and profiles, wires and nails, corrugated steel and reinforcement bars, they cover only 15
% of the country’s metal needs. Currently the industries use imported raw materials such
as iron ore, coiled wire rods and coiled sheet metals and the locally available scrap
metals.
The government of Ethiopia through its Growth and Transformation Plan has given high
priority to the metal and engineering industry sector. An objective and target has been
set to enhance the productivity and competitiveness of the sector. It is planned to
increase the annual per capital consumption of the country to 34.72kg and the capacity
utilization of the existing industries to 95%. Substituting of imported metal products and
supporting other manufacturing industries are also some of the main targets of Basic
Metal and Engineering Industry sector as indicated in the Growth and Transformation
plan.
1Firm level study on basic metal and Engineering industries of the federal democratic republic of Ethiopia, Chapters prepared by
JICA
1
1.2 OBJECTIVE OF THE STUDY
The market demand for metal is still going to increase due to huge government plans to
transform the country. Hence the Basic Metal and Engineering Industries play a vital
role in the economic development. Improving productivity and capacity utilization of
existing industries and also having new industries entering the market will definitely
help the national effort in narrowing the gap between demand and supply in the sector.
The objective of this opportunity study is to investigate the potential investment areas of
the metal and engineering sector that may attract foreign investors, foster imported metal
products substitution, create job opportunity, support other manufacturing industries and
increase the technology transfer, which in the end is believed to contribute its own share
to meet the national Growth and Transformation Plan.
1.3 SCOPE OF THE STUDY
The study shall be conducted in line with the plan for opportunity study developed by
engineering service directorate of MIDI. Hence, to attain the stated objectives the study
will include, but is not limited to,
 Identification of project ideas that may suit to interest of foreign investors, taking
into consideration metal and engineering products demand of the industry sectors
of high government priority and ascertaining the availability of demand by
analyzing imported data form revenue and custom authority.
 Identification & analysis of screening criteria for project ideas and conducting
screening and prioritizing of twelve viable project Ideas for further preparation
of project description document.
2
1.4 METHODOLOGY
1.4.1 Data Collection
This stage involves preparatory works necessary for undertaking the study. The major
focus at this stage includes identification of overall information requirement, collection
and review of studies, documents and literature related to government policies, strategies
and proclamations; identifications of gaps, and designing appropriate data collection
instruments.
In this study, only secondary data source is collected but in the next phases of the overall
study, there might be a need to use primary data sources. Two types of data have to be
collected from secondary sources, namely general economic and social data and specific
data for the metal and engineering sector. Accordingly, the following secondary sources
were used;
 Document about growth and transformation plan
 Customs data
 Project Profiles from internet source
 Ethiopian Mineral Resources study document
Moreover, in order to assess the trend in the sector owing to cost implications, the trend
assessment was exclusively based on secondary data sources obtained through review of
published statistics, annual reports and information available on the Internet.
3
PART ONE
PROJECT IDEAS IDENTIFICATION
I.
IDENTIFICATION OF PROJECT IDEAS
CLASSIFICATION OF PROJECT IDEAS
Basic metal industries and Engineering industries were used as a main classification of
the project ideas. The categories and the sub categories are explained briefly as follows2
.
I. Basic Metal industries are industries that are concerned with the refining and
production of raw metal products and primary metal products from mineral ores.
II. Engineering industries are industries which use the basic metal products as an
input and fabricate them in to various engineering products. The Engineering
industry is further subdivided in to 8 categories using the International Standard
Industrial Classification (ISIC Rev. 3.1Div .28-353 ).The categories are listed as
follows
1. Manufacture of fabricated metal products, except machinery and
equipment (Div.28)
2. Manufacture of machinery and equipment (Div. 29)
3. Manufacture of electrical machinery and apparatus(Div. 31)
LIST OF PROJECT IDEAS
I. Basic Metal Industries
 Sponge iron manufacturing plant
 Steel billet, slab and bloom manufacturing plant
 Structural steel manufacturing plant
 Seamless pipe manufacturing plant
 Aluminum extrusion manufacturing plant
 Aluminum foil manufacturing plant
2Technology Transfer as a catalyst for development of Basic Metal and Engineering Industries(BMEIs),ESME Journal 2011
3
International Standard Industrial Classification of All Economic Activities :ISIC Rev. 3.1
4
II. Engineering Industries
a. Manufacture of fabricated metal products, except machinery and equipment
 Ball bearing manufacturing plant

Link chain manufacturing plant

Non threaded mechanical fasteners manufacturing plant
b. Manufacture of machinery and equipment

Submersible pump manufacturing plant
c. Manufacture of electrical machinery and apparatus

Electric Motors, generators, and transformer manufacturing plant

Baking oven manufacturing plant
5
II.
DESCRIPTION OF 12 PROJECT IDEAS
1. Sponge Iron Manufacturing Plant
Product Description and Application
Sponge iron or direct reduced iron is a high quality porous solid-state metallic product
that is produced from iron ore (in the form of lumps, pellets or fines) using a reducing
gas such as natural gas or coal. It has a slightly higher iron content that makes it better
suited for use in an electric arc furnace route of steel making. The gases that are
produced during the production of sponge iron can be used in various applications that
help offset the cost of iron production.
Sponge iron can be used to produce powdered ore and wrought iron. It is also used as a
raw material for steel industries that are producing steel products such as billets, slabs,
and blooms as well as primary metal products such as long and flat steel products.
Sponge iron has gained further importance due to its proven utility in different steel
manufacturing processes such as L.D. converters, Open Hearth Furnaces (OHFs), Blast
Furnaces (BFs) Basic Oxygen Furnaces (BOFs), Induction Furnaces (IFs) and Cupolas4.
The World production of Direct Reduced Iron /sponge iron was 64.4 million tons in
2009. India is the largest producer with a production of 22 million tons which is more
than one-third of the world production. Of this, 16.2 million tons were produced In Coal
based Rotary Kilns. In India most steel industries are shifting from blast furnace route to
Electric Arc Furnace route. This together with the scarcity and the large increase in the
price of scrap metal gave a large boost for sponge iron production.
India gains a competitive advantage of sponge iron manufacturing due to the availability
of high quality ready raw materials and cheap labor. The existence of large number of
sponge iron manufacturers with inter competition also gives India an added
advantage. The fact that most of the processes used for the production of sponge iron are
not natural gas based helps India to increase its capacity despite the increase in gas price.
4http://www.dsir.gov.in/reports/techreps/tsr062.pdf
6
Figure 1: World DRI Production Trend
When looking at the Ethiopian metal industry sector, sponge iron manufacturing is
almost non-existent. By the time this document has been prepared there is only one
Sponge iron manufacturing plant, AYAS that is under construction. The Ethiopian iron
ore has lower quality; however its existence with TiO2 makes the iron ore exploring
economical and gives it a positive edge.
It can be seen from Indian experience that Sponge iron manufacturing can have a great
advantage for Ethiopia due to the availability of untapped mineral resources necessary
for the production of sponge Iron and the large domestic market potential. The low
energy cost of the country and the large supply of cheap, diligent, semi-skilled and
skilled labor which can be easily upgraded to the required skill level also will give the
sponge iron industry an advantage. Sponge iron manufacturing also have comparative
advantage due to an ever increasing domestic demand of steel products and the focus
that is given for the labor intensive industries.
Market study
According to the Ethiopian GTP the annual per capital Metal consumption of the
country is set to reach 34.2 kg in 2014/2015. The total steel demand is estimated to reach
3, 121,187 tons in 2014/20155 .For attaining this goal, new integrated steel industries
and Mini Steel Industries have to enter the business and the existing industries also need
5Firm level study on basic metal and Engineering industries of the federal democratic republic of Ethiopia, Chapters prepared by
JICA
7
to utilize their maximum capacity. Currently the existing metal industries of the country
use imported raw materials and the locally available scrap. When looking at the
percentage weight of imported basic metal products in 2008; it accounts 70 % of the
imported metal products.
For attaining the GTP raw material availability should be addressed first. The possible
utilization of iron deposit of the country plays a crucial role with this regard. Hence the
extracted sponge iron can be used as a basis for integrated and mini steel industries of
the country. It will also help in alleviating the shortage of scrap metal supply that might
be created when new industries enter the metal sector and the existing industries utilize
their maximum capacity. Hence as long as the demand for finished steel products is
increasing the demand of sponge iron is going to increase as well.
Raw Material
The main raw materials used for sponge iron manufacturing are Iron ore or pellets,
reductant
(natural
gas
or
non-coaking
coal)
and
a
desulfurizing
agent
(limestone/dolomite). The economic analysis of a 100 ton per day plant suggests that for
producing 1 ton of Sponge iron 1.6ton of iron ore, 1.5 ton of coal and 0.035 ton of
Dolomite are needed6. The specific properties of the raw materials are stated briefly as
follows while the quantitative availability of raw material can be referred from
Appendix Error! Reference source not found..
Iron Ore: Iron ore lumps or pellets should have high iron content, low gangue content,
good mechanical strength and readily reducible and non-decrepitating variety.
Reductant: Non-coaking coal is used as a reductant and a fuel in sponge iron
manufacturing. It should be highly reactive and have high fixed carbon content, high
volatiles content, low coking and swelling indices and high ash fusion point.
Desulpherizing agent: As a desulpherizing agent limestone and dolomite are used in
manufacturing of sponge iron. They should have lime or line and magnesia content
which is above 45%.
6
The economic analysis of a 100 ton per day plant suggests that for producing 1 ton of Sponge iron 1.6ton of iron ore,1.5 ton of
coal and 0.035 ton of Dolomite are needed.
8
Technology
 Manufacturing Process
Different technologies have been devised for the production of sponge iron. The
technologies are generally categorized into Gas Based Technologies and Solid Reducant
or
Coal
Based
Technologies7.The
direct
reduction
processes
available
for
commercialization are HYL III Process, Midrex Process and Coal Based Direct
Reduction8.
The manufacturing process for the coal based technologies is explained briefly as
follows. The Iron ore and non-coaking coal are charged into a rotary kiln in required
proportion along with some dolomite. The reduction process occurs in solid state.
During this process the combustion and conversion of coal to Carbon monoxide removes
the oxygen from the iron ore. The overall process requires duration of approximately ten
to twelve hours inside the kiln, during which iron ore is optimally reduced and
discharged to a rotary cooler for cooling below 120°C., before coming out into the
finished product circuit.
The Ethiopian ore is not suitable for blast furnace production of hot metal due to its high
Ti content9. Coal based technologies are best suited for extracting iron ore because there
is no need for oil and high quality coal. Due to a lower iron content of the Ethiopian ore;
production of TiO2 together with sponge iron is recommended to make it economical.
The technology for the production of sponge iron is new to Ethiopia and hence it will
have a great importance in technology transfer.
7http://www.dsir.gov.in/reports/techreps/tsr062.pdf
8http://www.spongeiron.com/orissa-sponge-iron-and-steel-ltd/
9
Firm level study on basic metal and Engineering industries of the federal democratic republic of Ethiopia, Chapters prepared by
JICA
9
Figure 2: Process Flowchart for sponge Iron 10
 Machine and Equipment
The basic capital equipment required for the coal based processes are11:
10Source :Status of sponge iron plants in Orissa Prepared : By Mr. HimansusekharPatra , MrBiswajyotiSahoo and DrBijaykumar
Mishra
10

Raw materials handling and feeding system

Rotary kiln with air injection and coal blowing systems

Rotary cooler

Product separation and handling System

Waste gas cleaning system

Briquetting system

Electrical system

Instrumentation and control system
Environmental Impact
Sponge iron plants are found to be polluting. During operation it emits huge quantity of
smoke containing oxides of Sulphur and Carbon, un-born carbon & silica particles. The
garbage factor for a ton of sponge iron and origin of pollution are shown in Table 1 and
Table 2 respectively. Different mitigation methods need to be used to minimize the
environmental effect of sponge iron plants.
INPUT
OUTPUT
1.6 -1.75 tons of Iron ore
1.8-2.0 tons of CO2
1.2-1.5 tons of coal
0.25 tons of dust
0.035-0.05 tons of Dolomite
0.29 tons of coal char
1.5-2.0 tons of water
0.02 tons of SO2,water vapor
Table 1 : Garbage Factor for a one ton of sponge iron unit12
Plant activities
Raw
Material
Handling
Iron ore
Coal
Dolomit
e
Principal
Manufacturing and Likely
form
of
constituents
operations
pollution
Dust
pollution
Air Pollution due to
Oxides of Fe,SiO2
fugitive dust and
Al2O3Sulphur
localized noise
compounds
other
Stockpiling
trace metals
,crushing ,
Complex compounds
screening and
of C,H,N,S,O and
conveying
Minerals
CaO , MgO , C, S
and other associated
minerals
11http://www.dsir.gov.in/reports/techreps/tsr062.pdf
12Status of sponge iron plants in Orissa Prepared : By MrHimansusekharPatra , MrBiswajyotiSahoo and
DrBijaykumar Mishra
11
Reduction
Direct Reduction of
temperature is about
Iron ore with Coal
1200oC
and Dolomite as a
fluxing agent
Separation and
Sponge
iron Fe metal 81-84 %
product processing with SiO2,S,P,C as screening, ambient
contaminants
temperature
Indirect
process
cooling/direct water
spraying
Process cooling and
Industrial water
dust suppression
Waste gas generation
containing CO2, CO,
SO2,
NOx ,
and
o
particulate at 900 C
 Generation of waste
water
with
contaminants mostly
particulates,
 Thermal pollution of
water
Table 2: Origin of pollution in coal based sponge iron plant13
13Status of sponge iron plants in Orissa Prepared : By MrHimansusekharPatra , MrBiswajyotiSahoo and
DrBijaykumar Mishra
12
2. Steel Billets, Slab and Bloom Manufacturing plant
Product Description and Application
The product mix in this project idea includes billets, blooms and slabs that can be used
as a raw material in the extrusion, forging and rolling processes. According to the
technical glossary of steel14 the products are defined as follows.
Billets are semi-finished long product of up to 150 mm square cross-section with round
corners. They are used for the manufacturing of long steel products such as Bars, rods,
channels, angles and other structural materials.
Slabs are Semi-finished steel products typically 150-400 mm thick which are used for
the manufacturing of hot rolled flat steel products such as sheets, coils and plates.
Blooms are semi-finished long product of greater than 150 mm square or rectangular
cross-section which can be produced by continuous casting or by rolling from ingot.
Having companies that can produce steel billets, blooms and slabs will give the country
a benefit in strengthening the supply side of the basic metal manufacturing industries.
With increasing demand and production capacity of downstream products such as rods,
bars, sheets and wires there should be an increase in the local production of upstream
products such as billets, slab and blooms. Even though there are some industries that are
producing billets information was not found at if they are selling these intermediate
products.
Downstream Products
Upstream Products



Billets
Slabs
Blooms
am Products








Rail, Sheet Pile, shape, Bar
Wire rods
Plate
Hot Rolled coil and sheet
Seamless Pipe
Downstream Products
Billets
Rail, Sheet
Pile, shape,
Barusing billets)
Figure 3: Downstream steel products (Red indicates
the industries
currently
Slabs
Blooms

Wire Rods

Plate
14Technical reference page - glossary of steel industry terms http://www.steelonthenet.com/
 Hot Rolled coil and sheet
13
 Seamless pipe
Market study
The import of primary steel15 products from customs data was used to study the current
market and to estimate the demand of primary steel products in the next 10 years. The
analysis of customs data shows that the import of Primary steel products such as ingots,
billets fluctuates from year to year Table 3.
A total of 48,820 tons of primary steel
products have been imported from 2005-2010.
The main users of billets and ingots in Ethiopia are rebar and seamless pipe
manufacturers. The fact that most of rebar manufacturers are using local scrap as a
charge for their furnaces might be one of the reason for the fluctuation in the import of
these products. As there exist no hot rolling mills which can produce hot rolled sheet
coils, there is no import of blooms and slabs within the last 6 years.
Year
Mass (Kg)
CIF(USD)
2005
2006
2007
2008
2009
2010
15,573,181.00
8,178,355.00
4,511,333.09
8,583,389.73
9,378,740.13
2,595,589.00
Tot=48,820,587.95
6,922,710.19
4,699,006.76
2,532,944.97
6,859,309.45
5,242,839.61
1,441,437.82
Tot=27,698,248.80
3-years
Average Net
Import (Kg)
9,420,956.36
6,852,572.95
Table 3: Import of Primary steel products
Even though industries that are producing plates, wire rods, hot rolled sheet and coils do
Not exist in Ethiopia at the time being; it is assumed that these products will be
produced locally in the future hence increasing the demand of the primary steel
products. Considering the launch of hot rolling mills in Ethiopia; an average growth rate
of 25 % is assumed to forecast the demand for the next 10 years.
Taking a base year to be 2010 and amount at this year to be the last three year average
which is 6,852,572.95 kg the demand until 2020 is forecasted. Table 4 shows the
projected demand of steel billet, slab and blooms until 2020 GC.
15Primary steel products includes billet, ingots, slabs and blooms
14
Year
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Projected
demand(Kg)
8565716.192
10707145.24
13383931.55
16729914.44
20912393.05
26140491.31
32675614.13
40844517.67
51055647.09
63819558.86
Table 4: Projected Demand for Primary Steel Products
Raw material
The raw materials used for the manufacturing of steel billet are sponge iron and scrap
metal. The availability of the sponge iron in the country depends on the execution of the
sponge iron plant in iron ore rich areas. However sponge iron can be imported from the
plant can also import Sponge Iron from India or other places.
Technology
 Manufacturing process
The Manufacturing process begins with the inspection of the raw materials. A scrap
metal alone or a mixture of sponge iron and scrap metal can be used as raw material.
Unwanted materials such as cast iron, nonmetallic and nonferrous things are removed
from the scrap metal. When using a mixture of sponge iron and scrap metal, the sponge
iron (40 % of the load) and the scrap metal (60% of the load) are charged in to an
induction furnace through a conveyor belt and bucket respectively. After being reduced
to molten iron it is then poured in to a Ladle Refining Furnace (LRF) in which the
chemistry and temperature of the molten metal are adjusted. The use of LRF instead of
conventional ladles reduces the costs, furnace time and refractory wear. For the
manufacturing of billets the LRF is transported to a continuous casting machine or an
ingot mold with the help of a crane. However continuous casting has advantages [Error!
Reference source not found.] for making the billets. The steel billets are then cut into
segments according to the required length .Finally they are allowed to cool by natural
convection and are grinded for a good surface finish.
15
 Machine and Equipment
Some of the equipment’s and machineries necessary for still billet, slab and bloom
manufacturing process are listed below

Induction Furnace

Plasma Ladle Refining Furnace

Continuous Casting Machine

Channel Spectrometer

Ladle Preheating System(Vertical and Horizontal)

Crane

Magnet Crane for SMS Shop, billet and scrap yard

Cutting Torches with Iron Powder Dispensing Units
3. Structural Steel Manufacturing plant
Product Description and Application
Structural steel is a steel made construction material, profile formed with specific shape
and cross section. Structural steel is the backbone of multi-story structures. They are
used in construction for bridges, industrial sheds, structures, buildings and transmission
line towers etc. The product range includes open sections such as channels, beams, LTZs
and angles and closed hollow sections such as LTZ profiles, circular, rectangular and
square hollow sections.

Hollow structural steels (HSS) are high strength longitudinally welded or bolted
structural elements with circular or Rectangular/square cross sections. HSS has
high strength-to weight ratios, excellent compression support characteristics and
excellent torsional resistance.

The I-beam is a beam with an I- or H-shaped cross-section. The horizontal
elements of the "I" are flanges which resist most of the bending moment
experienced by the beam, while the vertical element known as the web resists
shear forces.
16
Market study
Rectangular hollow section (RHS) , Square hollow section (SHS) AND Circular hollow
section s( CHS) are one of the most important construction materials for the
development of construction, industrial and agricultural facilities in Ethiopia.
According to the information obtained from Ethiopian investment agency, a total of 16
companies had obtained permits in the production of steel profiles and other products.
Out of the companies only five companies are in the operation phase currently.
On the other hand most of the remaining licensed companies are under pre investment
stages. From the past experience and trend evaluation of previously licensed companies
by the Ethiopian investment agency, it is very doubtful that all the licensed projects will
be realized and become operational
In addition to domestic production, the demand for hollow section products is mainly
met through import. Ethiopia imports a variety of hollow section products from the
world market. All the products had been imported from five countries mainly from Asia,
Europe, and Middle East.
The apparent consumption data of rectangular hollow section (RHS), Square hollow
section (SHS) and Circular hollow section (CHS), Comprising of domestic production
and imports (2005- 2010) is shown below.
Year
Import(ton)
Total(ton)
2005
Domestic
production(ton)
8,418,618
9,850,719.95
18,269,338
2006
15,098,298
10,480,973.79
25,579,272
2007
12,674,839
17,154,623.25
29,829,462
2008
17,939,029
12,558,115.25
30,497,144
2009
23,870,194
18,317,920.04
42,188,114
2010
28213951
10,932,931.69
39,146,883
TOTAL
106214929
79,295,283.97
185,510,213
AVERAGE
17,702,488
13,215,881
30,918,369
Table 5 : Import of structural steel products
17
Linear trend line is used for predicting the demand of structural steel products.
Year
Projected
demand (Kg)
2011
2012
46406562.1333
50831760.2190
2013
2014
55256958.3048
59682156.3905
2015
64107354.4762
2016
68532552.5619
2017
72957750.6476
2018
2019
2020
77382948.7333
81808146.8190
86233344.9048
Table 6 : Projected Demand for structural Steel
Raw Material
The main raw materials used for the production of structural steel are Hot/cold rolled
coils/sheets.
Technology
 Manufacturing process
HSS Manufacturing Methods
The general manufacturing processes for HSS include operations like forming, welding
and sizing. Three types of HSS manufacturing methods are used: Electric Resistance
Welding (ERW) Process, Form-Square Weld-Square (ERW) Process and Submerged
Arc Weld (SAW) Process .These manufacturing processes are explained briefly as
follows
i.
Electric Resistance Welding (ERW) Process
In the tube mill, flat steel strip (1) is formed continuously around its longitudinal axis to
produce a round tube. This is done by moving the strip through a progressive set of rolls
(2-6). The strip edges (7) are heated by either high frequency induction or contact
18
welding and then forged together by weld rolls to create a continuous longitudinal weld
without the addition of filler metal. The weld seam (8) is then cooled and processed
through a set of sizing/shaping rolls which cold-form it into a round (9), square (10) or
rectangular (11) section.
ii.
Form-Square Weld-Square (ERW) Process
In the weld mill, driven forming dies progressively shape the flat strip (1) by forming the
top two corners (2) of the square or rectangular tube in the initial forming station.
Subsequent stations from the bottom two corners (3) of the shape. No cold working of
the sides of the shape is performed, and the shape’s seam is welded by high-frequency
contacts when the tube is near its final shape and size. The welded tube (4) is cooled
and then driven through a series of sizing stations which qualifies the tube’s final
dimensions.
iii.
Submerged Arc Weld (SAW) Process
19
Two identical pieces of flat strip (1) are placed in a press brake and formed into two
identical halves (2) of a finished tube size. A backup bar is tack welded to each leg of
one of the half-sections (3). The two half sections are fitted together toe-to-toe (4) and
welded by the submerged arc process to complete the square or rectangular section (5).
 Machineries
For the manufacturing of structural steel the following machineries are needed Slitting
machines

Uncoiler

Shearing machine

Coil end jointing fixture

Hoop feeder

Hoop exist guide roll

Tube mill

Tube mill

Leveler forming machine

Welding equipment cooling system

Sizing machine

Cutting machine
4. Seamless pipe manufacturing plant
Product Description and application
Seamless pipes are used where strength, resistance to corrosion and product life is
crucial. Ultra high strength and corrosion-resistant properties make these perfect for oil
and gas industry, steam boilers, chemical and other processing industries, pipelines,
20
installation with high and supercritical steam and pressure conditions, etc. Due to their
varied uses, seamless pipes and tubes find their application in several industry sectors
which include:

Refineries & Petrochemical plants

Fertilizer industry

Steel plants

Power plants

Industry using Boilers.

Sugar plants

Chemical plants

Industry using Heat Exchangers and Condensers.

Automobile manufacturing plants

Railways

Defense (aircraft, missile, nuclear power plants)
Market study
The countries demand for steel pipes is increasing due to the growth of the construction
sector, water distribution and need of furniture for the expansion of schools, hospitals,
hotels etc. Currently the market of seamless pipes is totally from import. Recently the
product is imported from china, Czech Republic and France.
Data from custom and revenue authority shows that in the last six years seamless pipes
are imported in bulk for different purposes by local industries in Ethiopia. As table7
below indicates during the last six consecutive years a total of 31,483,373 ton of
seamless pipes were imported which costs 53131237 SUD.
year
Net Mass (ton)
Growth
(%)
rate CIF_Value
(USD)
(%)
2005
3097656
3131799
2006
3944299
4281454
2007
3160965
4103644
2008
2623558
4702742
2009
5827290
11624381
21
Growth
rate
2010
12829606
25287218
sum
31483373
53131237
5247229
8855206
average
Table 7: Import of seamless pipes products
Whereas the predicted demand gap of the product using double exponential method is
shown in table below.
year
Forecasted
(double)
2013
13686689.9065
2014
15223499.6784
2015
16760309.4504
2016
18297119.2223
2017
19833928.9943
2018
21370738.7662
2019
22907548.5381
2020
24444358.3101
2021
25981168.0820
2022
27517977.8540
Table 8: Projected Demand for seamless pipes products
Raw Material
The main raw material needed for the production of seamless pipe is hot rolled steel
billets.
Technology
 Manufacturing Process
Seamless pipe manufacturing uses hot rolled round bar billet of carbon steel or steel
alloy. The billets are cut into suitable length depending on the required length of the
22
finished tube. The billets are heated in a furnace at a temperature of 1200 0C to 1300
0C.
Then the seamless tube is formed by drawing a solid billet over a piercer to create the
hollow shell (mother blanks). These hollows are crimped at one end in hot condition and
then they are air cooled.
The tubes are then surface treated (pickled, phosphate coated and lubricated) to facilitate
the next process of tube drawing. Depending on the finished sizes required, the tubes are
subjected to single, double or triple drawing. After every draw the tubes are annealed at
a temperature of 750 0C. The tubes are then straightened and cleaned if necessary and
before being cut to the exact size required. The finished tubes are tested for quality and
they are marked and coated with rust preventive oil before being bundled and
dispatched.
5. Aluminum Extrusion manufacturing plant
Product Description and Application
Aluminum extrusions are used for a wide variety of structures such as windows, doors,
water tanks, for show cases, handrails, curtain walls etc. These products are popular
because they are strong, durable, flexible, lightweight, corrosion-resistant and
completely recyclable. Construction and transportation industries cover the largest end
markets of aluminum.
In Ethiopia most of the aluminum is consumed by construction industries. Due to this
demand some aluminum factories have mushroomed in the country within the last 5
years. However majority of these factories use imported profiles as a raw material.
Market study
Ethiopia’s Aluminum market is increasing from time to time due to the rapid growth in
the construction industry of the country. Nowadays it is common to see modern
buildings and residential areas fitted with a lot of mirrors and aluminum frames. In
accordance with this growth, more and more aluminum fabricators are entering the
market with a product mix of windows, doors, handrails and frames etc. These
companies use imported aluminum profile as a raw material. By the time this document
is being prepared there is only one aluminum extrusion factory, B and C Aluminum, in
the country. Hence the availability of aluminum extrusion factory will be advantageous
23
in reducing the foreign currency that is spent on the import of extruded aluminum
profiles in an addition to creating a sustainable supply chain for the aluminum industries
of the country.
To put quantitative values on the demand of an aluminum profile, the 2005-2010
customs data is used. From the data it is seen that different aluminum products such as
profiles, rods, bars, hollow profiles, pipes and tubes, windows and doors, articles of
aluminum etc. are imported. For this analysis however the import of Aluminum bars,
rods, profiles, tubes and pipes is used.
From the table it can be seen, Ethiopia has been importing 11677261 k.g of aluminum
profiles and cost 523, 015,342.98 USD during the year 2005 to 2010.
Year
Mass (Kg)
CIF(ETB)
2005
969105.34
79,682,229.21
2006
1472150.79
48461022.21
2007
1593454.48
49126198.03
2008
2218226.34
93830216.63
39.2
2009
2677964.25
107546746.5
20.7
2010
2746359.34
144368930.4
Avg=1946210.09
3 years average
import (Kg)
Growth Rate
(%)
51.9
1344904
8.2
2547517
Tot=523,015,342.90
2.6
Average=24.5
Table 9: Annual import of Aluminum bars, rods, profiles, pipes and tubes
For predicting the demand of aluminum profiles a trend line is used .As seen in Graph 1
the R-squared value is 0.96 which is an indicator of a good trend line fit. The demand of
aluminum profile is predicted using the trend line equation. Table below shows the
projected demand for the product during the year 2011 to 2020.
24
Mass (Million of Kg)
4
y = 375099x - 8E+08
R² = 0.9642
3.5
3
2.5
2
Mass (Kg)
1.5
Linear (Mass (Kg))
1
0.5
0
2004
2006
2008
2010
Year (G.C)
2012
2014
Graph 1 Trend line prediction for Aluminum Profile
Year
Net Weight (kg)
2011
3,259,053
2012
3,634,153
2013
4,009,252
2014
4,384,352
2015
4,759,451
2016
5,134,551
2017
5,509,650
2018
5,884,750
2019
6,259,849
2020
6,634,949
Table 10: Project Demand of Extruded Aluminum profile
Raw Material
The raw material used for an aluminum extrusion factory is an aluminum scrap and if
the scrap is not available an aluminum billet can be imported from abroad. Aluminum
scrap can be available from aluminum factories. The other material needed is coating
powder and chemical which can be imported from abroad.
25
Technology
 Manufacturing process16
If the raw material used is scrap aluminum, the process starts by melting the scarp and
casing a billet. However If the raw material used is a billet the process starts from
heating the billet to a certain desired temperature. The heated billet is then put into the
extrusion press. Lubricant needs to be added to the billet and ram so that they won’t
stick together. In the extrusion press the ram applies pressure to the billet to force it
through a die. Soft but solid metal begins to squeeze through the die opening. It is then
pushed out of the die to the lead-out table and the puller which guides the metal down
the run-out table during extrusion. The extrusion is cooled by a series of fans along the
entire length of the run out table. The remainder (butt) of the extruded billet is removed
in order to load and weld another billet to continue the extrusion process. When enough
extrusion length is acquired, the profile is cut into the desired length and transferred (via
Belt or walking beams systems) to a cooling table. After it has been cooled it is moved
to the stretcher in which straightening and work hardening of the extrusion is performed.
It is then cut to standard length with high tolerance saw. Next it is moved to an ageing
oven in which heat-treating or artificial aging hardens the metal by speeding the aging
process in a controlled temperature environment for a set amount of time. Lastly it is
moved to a powder coating plant in which the profile is coated and wrapped to prevent it
from dust. Generally, aluminum extrusions are then machined and or assembled into
finished parts and components.
 Machine and equipment
The machineries and equipment needed for an extrusion plant are mentioned as follows

Melting furnace

Casting machine

Extrusion press machine and Handling system

Moving and shifting vessel

Different auxiliary machines
16
http://www.bonlalum.com/extrusion_process.shtml
26
6. Aluminum foil manufacturing plant
Product Description and Application
Aluminum foil is aluminum prepared in the form of thin metal leaves. The foil can
easily be bent or wrapped around objects. Its application can be divided into two:
packaging applications and non-packaging application. In the packaging application it is
used for packing foods, cosmetics, and chemical products whereas in the non-packaging
application it is used in industrial applications such as thermal insulation, fin stock,
electrical coils, capacitors etc.
The excellent impermeability of Aluminum foil to water vapor and gases together with
its ability to increase shelf life and recyclability makes it an outstanding choice for
packaging. Thin aluminum foils are fragile and are sometimes laminated /Backed to
other materials such as plastics or paper to make them more useful.
Market study
The major users of aluminum foil in Ethiopia are cigarette factories, pastries and
restaurants which sell take away foods. The expansions of hotels and restaurants will
foster the need of aluminum foil. Aluminum foil demand will also increase in relation
with the development of agro processing industries. Currently there are no aluminum
foil manufacturing industries. The demand for the backed and blister foils is met from
imports. As can be seen from the table below there is an increase in import of this
product from time to time. At an average 382595.72 kg has been imported annually in
the years 2005 -2010.
Year
Mass (Kg)
CIF(ETB)
Three years average
import (Kg)
2005
257,454.94
8,093,526.70
2006
319,593.99
10,362,637.36
24.1
2007
290,057.49
11,570,957.60
-9.2
2008
411,879.69
15,513,694.12
2009
359,039.00
17,699,086.22
2010
532,408.41
31,024,413.73
289,035.47
42.0
-12.8
434,442.37
Tot=2,170,433.52 Tot=94,264,315.73
Table 11 : Annual import of Aluminum Foil
27
GR (%)
48.3
Avg=18.5
As seen in Graph 2 a polynomial trend line has been fitted to the data. An R-squared
value of 0.81 is found form this fitted trend line and hence indicating a good fit. Using
the equation of the trend line the import of aluminum foil has been predicted.
Mass (Millions Kg)
1.00
y = 8,266.70x2 - 33,144,648.33x +
33,222,964,655.31
R² = 0.81
0.80
0.60
0.40
Mass(Kg)
0.20
Poly.
(Mass(Kg))
0.00
2000
2005
2010
Year (G.C)
2015
Graph 2: Trend line prediction for Aluminum foil
Year
Projected demand
(kg)
2011
611934
2012
724220
2013
853039
2014
998392
2015
1160278
2016
1338697
2017
1533650
2018
1745136
2019
1973156
2020
2217709
Table 12: Project Demand of Aluminum foil
Raw Material
The major raw material for the production of Aluminium foil is aluminium ingot.
Plastic, paper or paperboards are the auxiliary raw materials needed for manufacturing
backed aluminium foil.
28
Technology
 Manufacturing Process
The manufacturing process mentioned here starts from the heating of aluminum ingots.
The process of producing aluminum foil involves many steps, including refining,
smelting, rolling and finishing before it becomes the common product that is used in
households every day.
The ingots of aluminum are heated to make them more malleable, rolled, passing
backwards and forwards through large rollers as the slab gets thinner and thinner, and
longer and longer. This metal strip is hot rolled to a thickness of 2 to 4 mm (2000 to
4000 microns) and then coiled, before being cold rolled to metal thicknesses of between
6 and 400 microns. The thinnest foil used for wrapping chocolates may be only 6
microns thick (about one-eighth the thickness of newspaper!), with household wrapping
and cooking foil between 11 and 18 microns, lidding foil between about 30 and 40
microns, and foil for foil containers generally between 40 and 90 microns.
The foil is then annealed by a thermal process to make it pliable: great care is taken to
ensure the correct balance between flexibility and strength for different applications.
After the foil stock is made, it must be reduced in thickness to make the foil. This is
accomplished in a rolling mill, where the material is passed several times through metal
rolls called work rolls. As the sheets (or webs) of aluminum pass through the rolls, they
are squeezed thinner and extruded through the gap between the rolls. The work rolls are
paired with heavier rolls called backup rolls, which apply pressure to help maintain the
stability of the work rolls. This helps to hold the product dimensions within tolerances.
The work and backup rolls rotate in opposite directions. Lubricants are added to
facilitate the rolling process. During this rolling process, the aluminum occasionally
must be annealed (heat-treated) to maintain its workability.
The reduction of the foil is controlled by adjusting the rpm of the rolls and the viscosity
(the resistance to flow), quantity, and temperature of the rolling lubricants. The roll gap
determines both the thickness and length of the foil leaving the mill. This gap can be
adjusted by raising or lowering the upper work roll. Rolling produces two natural
finishes on the foil, bright and matte. The bright finish is produced when the foil comes
29
in contact with the work roll surfaces. To produce the matte finish, two sheets must be
packed together and rolled simultaneously; when this is done, the sides that are touching
each other end up with a matte finish. Other mechanical finishing methods, usually
produced during converting operations, can be used to produce certain patterns.
As the foil sheets come through the rollers, they are trimmed and slitted with circular or
razor-like knives installed on the roll mill. Trimming refers to the edges of the foil,
while slitting involves cutting the foil into several sheets. These steps are used to
produce narrow coiled widths, to trim the edges of coated or laminated stock, and to
produce rectangular pieces. For certain fabricating and converting operations, webs that
have been broken during rolling must be joined back together, or spliced. Common
types of splices for joining webs of plain foil and/or backed foil include ultrasonic, heatsealing tape, pressure-sealing tape, and electric welded. The ultrasonic splice uses a
solid-state weld—made with an ultrasonic transducer—in the overlapped metal.
 Machinery and Equipment

Rolling mill

Trimming machine

Slitting machine

Ultrasonic splice

Printing machine

Lamination machine

Cutting machine
7. Ball Bearings manufacturing plant
Product Description and Application
Ball bearing is a type of rolling element that uses balls to maintain the separation
between the bearing races. There are four major parts to a standard ball bearing: the
outer race, the rolling balls, the inner race, and the cage. The balls are held by a cage,
which keeps them evenly spaced around the races. They are used to reduce rotational
friction and support radial and axial loads .The balls in the cage are used to transmit the
loads.
30
Market study
A total of 3,077,139.85 Kg of ball bearings worth 22,035,890.03 USD has been
imported from the year 2005-2010. The recent three years average of the imported
bearings has increased to 587,543.94Kg from the previous three years average import,
which was 438,169.35 Kg. the average growth rate from the year 2005-2010 is 27.91%.
Year (GC)
Net Weight (Kg)
Growth Rate (%)
Three years
Average Net
Import (kg)
2005
414,180.14
27.91
2006
529,794.45
-30.06
2007
370,533.45
5.51
2008
390,957.99
19.05
2009
465,424.33
94.71
2010
906,249.49
23.43
Tot=3,077,139.85
Avg=27.91
438,169.35
587,543.94
Table 13: Annual import of ball bearings
A Polynomial trend line has been fitted to the imported quantities of 2005-2010. An R
squared value of 0.76 is found for this fit. A forecast has been made using this line.
Taking a base year of 2010 with a forecasted demand of 680,000Kg the average growth
rate for the 2010 - 2015 has been predicted to be 10.23%.
31
Net Weight (Kg) Millions
10.00
9.00
8.00
7.00
6.00
5.00
4.00
3.00
2.00
1.00
0.00
2000
y = 45731x2 - 2E+08x + 2E+11
R² = 0.7561
2005
2010
2015
Year (GC)
2020
Net
Masss(Millions
of kg)
Poly. (Net
Masss(Millions
of kg))
2025
Graph 3: Trend line prediction for ball bearings
Year (G.C.)
Projected demand
(Kg)
2011
741622.7347
2012
806984.4755
2013
872346.2164
2014
937707.9572
2015
1003069.6981
2016
1068431.4390
2017
1133793.1798
2018
1199154.9207
2019
1264516.6615
2020
1329878.4024
Table 14; Projected Demand for ball bearings
Raw materials
Almost all parts of all ball bearings are made of steel. Since the bearing has to stand up
to a lot of stress, it needs to be made of very strong steel. The standard industry
classification for the steel in these bearings is 52100, which means that it has one
percent chromium and one percent carbon (called alloys when added to the basic steel).
32
This steel can be made very hard and tough by heat-treating. Where rusting might be a
problem, bearings are made from 440C stainless steel. The cage for the balls is
traditionally made of thin steel, but some bearings now use molded plastic cages because
they cost less to make and cause less friction.
Technology
 Manufacturing process
The different components of a ball bearing have different manufacturing processes, which are
explained as follows
Races
Since both the outer and inner races are rings of steel, the process starts with steel tubing
of an appropriate size. Automatic machines similar to lathes use cutting tools to cut the
basic shape of the race, leaving all of the dimensions slightly too large. The reason for
leaving them too large is that the races must be heat treated (hardening and tempering)
before being finished, and the steel usually warps during this process. They can be
machined back to their finished size after being heat-treated. However, the races are
going to be too hard to cut with cutting tools, so the rest of the work must be done
with grinding wheels. Very fine abrasive slurry is used to polish the races for several
hours to get almost a mirror finish. At this point, the races are finished, and ready to be
put together with the balls.
Balls
The balls start out as thick wire. This wire is fed from a roll into a machine that cuts off
a short piece, and then smashes both ends in toward the middle. This process is called
cold heading. During the process the balls acquire a shape like the planet Saturn, with a
ring around the middle called "flash”.
The first machining process removes this flash. The ball bearings are put between the
faces of two cast iron disks, where they ride in grooves. The inside of the grooves are
rough, which tears the flash off of the balls. One wheel rotates, while the other one stays
still. The stationary wheel has holes through it so that the balls can be fed into and taken
out of the grooves. A special conveyor feeds balls into one hole; the balls rattle around
the groove, and then come out the other hole. They are then fed back into the conveyor
for many trips through the wheel grooves, until they have been cut down to being fairly
33
round, almost to the proper size, and the flash is completely gone. Once again, the balls
are left oversize so that they can be ground to their finished size after heat treatment.
After heat treatment, the balls are put back into a machine that works the same way as
the flash remover, except that the wheels are grinding wheels instead of cutting wheels.
After this, the balls are moved to a lapping machine, which has cast iron wheels and uses
the same abrasive lapping compound as is used on the races. Here, they will be lapped
for 8-10 hours; depending on how precise a bearing they are being made for. Once
again, the result is steel that is extremely smooth.
Cage
Steel cages are stamped out of fairly thin sheet metal, much like a cookie cutter, and
then bent to their final shape in a die. A die is made up of two pieces of steel that fit
together, with a hole the shape of the finished part carved inside. Plastic cages are
usually made by a process called injection molding.
Assembly
Assembly of the parts begins after all the components are manufactured. First, the inner
race is put inside the outer race, only off to one side as far as possible. This makes a
space between them on the opposite side large enough to insert balls between them. The
required number of balls is put in, then the races are moved so that they are both
centered, and the balls distributed evenly around the bearing. At this point, the cage is
installed to hold the balls apart from each other. Plastic cages are usually just snapped
in, while steel cages usually have to be put in and riveted together. Now that the bearing
is assembled, it is coated with a rust preventative and packaged for shipping.
34
8. electric motors, generators and transformers manufacturing
plant
Product description and application
An electric
motor
is
an
electromechanical
device
that
converts electrical
energy into mechanical energy whereas The reverse process, producing electrical energy
from mechanical energy, is done by generators such as an alternator or a dynamo; some
electric motors can also be used as generators, for example, a traction motor on a vehicle
may perform both tasks. Electric motors and generators are commonly referred to
as electric machines. Most electric motors operate through the interaction of magnetic
fields and current-carrying conductors to generate force.
Electric motors are found in applications as diverse as industrial fans, blowers
and pumps, machine tools, household appliances, power tools, and disk drives. They
may be powered by direct current, e.g., a battery powered portable device or motor
vehicle, or by alternating current from a central electrical distribution grid or inverter.17
Whereas Transformer is an electro mechanical device which transfers electrical energy
from one circuit to another by means of changing magnetic field, without changing the
frequency. Different types of transformers are used for different electronic applications.
Advancement in the field of electronics has influenced change of design and use of new
type of core materials.
Market Study
Table reveals that import of transformer during the period under reference has been
generally rising except 2008. The average level of import during the first three years,
i.e., 2005-2007 was about 1,657,991 kg. However, during the recent last three years
2008-2010, the average level of import has increased to about 5,106,917 kg. During the
period 2005 – 2010, import of the products has registered an average annual growth rate
17http://en.wikipedia.org/wiki/Electric_motor
35
of 83%. In sum during the last six year nearly 20,294,725 kg unit of transformers had
been demanded and imported with an amount of 210,469,713 USD.
Whereas import of electric motor and generator during the period under reference has
been generally increasing except 2009. The average level of import during the first three
years, i.e. 2005-2007 was about 3,513,317 kg. However, during the recent last three
years 2008-2010, the average level of import has increased to about 5,201,505 kg.
During the period 2005 – 2010, import of the products has registered an average annual
growth rate of 18%. In sum during the last six year nearly 8714822 kg unit of
transformers had been demanded and imported with an amount of 16,625,324.09 USD.
year
2005
2006
2007
2008
2009
2010
Average
growth
rate
CIF value ( USD)
Motor
and transformer
generators
2,465,078.85
5,936,986.79
1718628.47
9,982,982.29
1414368.52
35,663,433.76
1776907.69
32,458,404.21
5228394.4
54,744,989.32
4021946.16
71,682,916.83
Net_ Mass
Motor
and
generators
977450.2
1103943
1431924
1546315
1514199
2140991
transformer
572,479
962,618
3,438,878
3,129,830
5,278,833
6,912,087
Growth Rate
Motor and
generators
12.94%
29.7%
7.98%
-2%
41.39%
18%
transforme
r
68%
257%
-9%
69%
31%
83%
Table 15: Import of motor, generators and transformer used in {kg} and its CIF value (USD)
To estimate the current demand of transformer, 2010 has been taken as a base year and
the net mass for this year is projected as 6,900,000. The trend line in graph 7 below
Shows that in the year (2011-2020) in average the demand for transformers will increase
by 10.78 % and if the trend keeps linear, the demand for the product will be anticipated
to go up to 134,700,000 units of KG by 2020.
36
Net_Mass in Millions
25000000
y = 1E+06x - 3E+09
R² = 0.9401
20000000
15000000
Net_Mass
10000000
Linear (Net_Mass)
5000000
0
2000
2005
2010
2015
Year
2020
2025
Graph 4: projected demand of transformer
Where as to estimate the current demand of electric motor and generator, 2010 has been
taken as a base year and the net mass for this year is projected as 2,150,000 kg. The
trend line shows that in the year (2011-2020) in average the demand for transformers
will increase by 6.86 % and if the trend keeps linear, the demand for the product will be
Net _Mass
anticipated to go up to 30,970,000 units of KG by 2020.
4500000
4000000
3500000
3000000
2500000
2000000
1500000
1000000
500000
0
2000
y = 204653x - 4E+08
R² = 0.8786
Net_Mass(Kg)
Linear (Net_Mass(Kg))
2005
2010
2015
2020
2025
year
Graph 5: projected demand of motor and generators
Raw Material
The raw materials used are Super enameled copper wire (different gauges); Core
material (laminations); Bobbins and forms; Clamps/base plates/ bolts and nuts; Flexible
leads/sleeves; Impregnate materials (including varnish); insulating material and
37
Consumables (solder, flux, packing material). Bolts and nuts demand will be covered by
domestic demand whereas the other raw materials will be imported from abroad.
Technology
 Manufacturing process
The incoming raw materials are tested for required quality before released for
production. The super enameled copper wire is wound on bobbins or former as per
required specification by using CNC winding machine. The coils are then stalked with
core material, terminated and clamped. The completed transformer and coils are vacuum
impregnated by using varnish and baked in an Oven at a particular temperature. Then
transformers are tested for electrical specification before packing.
 Machine and equipment
Machinery and equipment to manufacture transformer are CNC Winding Machine ,
Semi-Automatic Winding machine,
Oven (3.5 kW) ,Vacuum Impregnation Plant
,Testing Equipment Digital LCR-Q Meter ,Oscilloscope , Insulation Tester , High
Voltage break ,down tester, egger , Digital Multi meter , Analog Multi meter ,
Electrification ,machinery and equipment, Tools, Jigs, Fixtures and Soldering Iron
station and Office equipment and furniture.
9. Submersible pump manufacturing plant
Product description and application
Submersible pump is centrifugal type of pump which pumps out water from the bored
hole or well. The pump is coupled with an electric motor. The shape of the pump and
motor is cylindrical which makes it easy to be fitted in drilled bore in the earth. The
pump remains dipped in water due to which there will not be any suction trouble.
Submersible pump is used for continuous discharge of water in quantity as well as for
high heads and also for domestic purpose to get sufficient water. Ethiopia being rich in
agricultural resources there will also always be demand for the product in areas of
irrigation.
38
Market Study
Table 35 reveals that import of Submersible Pumps during the period under reference
has been generally declining. The average level of import during the first three years,
i.e., 2005-2007 was about 911,677 kg. However, during the recent last three years 20082010, the average level of import has decreased to about 67,413kg. But the result shows
that the product has been imported and significant costs has been incurred up to recent
years. In sum during the last six year nearly 2,937,271 kg of Submersible pumps had
been demanded and imported with an amount of 30,325,513 USD.
year
CIF value ( USD)
2005
15,071,480
2006
9,696,841
2007
1,738,568
2008
1,563,940
2009
2,121,692
2010
132,992
Average growth rate
Net_ Mass
1,926,246
697,828
110,958
93,387
101,494
7,358
Growth Rate
-64
-84
-16
8.7
-92.8
-50
Table 16 : import of submersible pumps
To estimate the current demand the recent three years average has been taken as a abase
demand for 2010. Accordingly the current (year 2010) demand for submersible pumps
has been estimated as 67,413kg.
Increase in construction sector, housing and industries will promote more production of
said goods and tend to increase the demand still further. However, the future demand is
expected to proliferate and stabilize at 10% rate of increase. Future demand estimates of
Submersible pumps have been projected at 10% rate of increase and the figure has
shown below in Table 36.
Table 36 shows that, in the year (2011-2020) the demand for the product will be
anticipated to go up to 1,181,828 units of KG by 2020.
39
year
Projected demand
2011
74,154
2012
81569
2013
89,726
2014
98,699
2015
108,569
2016
119,426
2017
131,369
2018
144,506
2019
158,957
2020
174,853
Table 17: Projected demand of Submersible pumps
Raw Material
Cast Iron Castings, Gun Metal Castings, Stainless Steel Shafts, EN-8 Steel, MS Rods of
various sizes, Copper Rods & Castings, Stamping/Laminations for Stators & Rotors,
Seamless pipe 150mm diameter and PVC wire of different gauges, Cable wire, Rubber
components, Hardware items and paints will be used as raw materials and all the raw
materials will be imported.
Technology
 Manufacturing process
There are two main portions of Submersible Pump which are coupled together, one is
electric motor and the other is pump which is manufactured single stage or multi stages.
Motor body i.e. Stator is made by boring seamless pipe and fitting stamping in it. The
rotor is made by turning shaft and fitting bushes, stamping on it. PVC wiring is done in
stamping of both rotors as well stator; terminals are brought out from the motor and
jointed with the cable. Pump has number of parts which are made out of various metals
such as CI, GM, SS, and EN Steels etc. The raw material is cut to size on power
hacksaw, turned on laths, key-way cut on milling and slotting machine. Some of the
parts are ground and some are balanced on balancing machines. All component parts are
inspected at every stage before taking for assembly. Then the parts are assembled to
40
complete the pump. Motor and pump are coupled together to get Submersible Pump.
Then it is tested for water discharge.
10. Link chain manufacturing plant
Product description and application
Link Chain is a series of links made from mild steel wire / rod with electric butt-welding
on each link. These link chains are generally of three type's namely large link / semi
long link and short link depending on the size of the link and safe working load. These
are also made from alloy steels depending upon the working requirements. The diameter
of the wire/rod varies from 4 to 12 mm. The size of the link varies according to its
diameter.
Link Chain is a very vital part of material handling equipment’s. it is mainly used in
handling activities and used in Cranes, Chain Drives, Conveyor Systems, Dairy and
Agro farming activities, Manual Weighing Systems, Road Transport and Railways etc.,
Market Study
Table 37 reveals that import of articulated link chain of iron or steel during the period
under reference has been rising except 2007/08. The average level of import during the
first three years, i.e., 2005-2007 was about 306,325 kg. However, during the recent last
three years 2008-2010, the average level of import has decreased to about 303,197 kg.
But the result shows that the product has been imported and significant costs has been
incurred up to recent years. In sum during the last six year nearly 609,522 kg of link
chain had been demanded and imported with an amount of 2,999,544 USD.
41
year
CIF value ( USD)
2005
512,910
2006
499,567
2007
592,668
2008
281,693
2009
455,692
2010
657,014
Average growth rate
Net_ Mass
85,285
127,621
93,419
67,796
94,168
141,233
Growth Rate (%)
49.6
-26.79
-24.4
38.8
49.9
17.4
Table 18 : import of articulated link chain
To estimate the current demand 2010 has taken as a base line year and accordingly the
current demand for link chain has been estimated as 140,000kg. The trend line shows
that in the year (2011-2020) in average the demand for link chain will increase by 20.9
% and if the trend keeps polynomial, the demand for the product will be anticipated to
Net_Mass in Millions
go up to 4,640,000 of KG by 2020.
1000000
900000
800000
700000
600000
500000
400000
300000
200000
100000
0
2000
y = 4748.9x2 - 2E+07x + 2E+10
R² = 0.8122
Poly. (Net_Mass(Kg))
Poly. (Net_Mass(Kg))
2005
2010
2015
Year
2020
2025
Graph 6 : projected demand of articulated link chain
Raw Material
Wire rods 8, 10, 12 mm. diameter, welding material/consumables and packaging
material wooden cases PP strips shall be used as raw materials.
Technology
 Manufacturing process
Mild Steel dram wire in coils is set on the de-coiler of wire bending machine. Then wire
is fed to automatic wire bending machine where during the feeding wire get straightened
then cut to the required link size and bent to form link. The process repeats and chain is
42
formed with bent links. The chains are pickled and cleaned with acid and water. Now
chains [one by one] fed on to the electro mechanical butt-welding machine, where open
ends of the chains automatically welded and debarred. The welded chains are now
inspected and tested as per the specifications laid down in the respective Standards, after
this welded chains are generally packed in wooden cases. The defective chain links may
be salvaged by gas welding.
11. Baking Ovens manufacturing plant
Product description and application
Baking ovens are used to prepare bakery products like bread, cookies, cakes and various
sorts of sweet and normal bread. Baking ovens using electric power are clean and
comfortable to utilize. They can be made for preparing the products in various
capacities. Their sizes can vary from 50x50x50cm small size to larger sizes of
100x100x200cms.Their output capacity can vary in range from 20kgs/day to200kgs/day
of bread. The electric consumption for such bakery is within the range of 5 kw to 20 kw.
These are baking ovens that are useful for small and medium scale bakeries which are
commonly spread with in the towns and cities of the country. Their fabrication involves
mainly metal tubes and sheet metals utilizing locally available machines.
Market Study
Supply of bakery ovens is mainly met from import. Although negligible amount of the
product is produced in some workshops locally the data could not be found in the
Survey of Manufacturing and Electricity Industries published by the Central Statistical
Agency. Hence, in the absence of domestic production data the import data obtained
from the Customs Authority is used as a proxy to estimate the current unsatisfied
demand for bakery ovens.
The import data depicted in Table 38 shows that The imported quantity which was only
305,807 units during 2005 has sharply increased to 1,286,505 units during 2006, then
declined to 110,499 units and 32,296 unit and again increased to 92,840units in after
declined by a large rate. One specific features of the data presented in Table 40 is that
there is a sharp decline in the year following large importation.
43
However during the last six year nearly 1,833,002 units of electric ovens had been
demanded and imported which costs 305,272 USD.
CIF Value (USD)
Net _ Mass
rate (%)
2005
43,681
305,807
-
2006
228,744
1,286,505
320
2007
10,302
110,499
-91
2008
9,555
32,296
-71
2009
12,193
92,840
187
2010
797
5,055
-95
50
Average growth rate
Table 19 : import of electric oven during the year 2005 to 2010
In the absence of a trend in the data set the following assumptions are adopted to
determine the current effective demand. The demand for baking ovens is believed to
increase with population growth, income rise urbanization and electrification of towns.
And the combined effect of the above factors is expected to increase the demand by 5%
per annum. The projected demand based on this assumption is given in Table 39 below.
To estimate the current demand the recent three years average has been taken as a abase
demand for 2010. Accordingly the current (year 2010) demand for electric ovens has
been estimated as 43397 unit. The unsatisfied demand for baking ovens will be expected
to increase by 573,134.25 units in 2020.
year
Projected demand
2011
45566.85
2012
47845.19
2013
50237.44
2014
52749.31
2015
55,386.77
2016
58156.1
2017
61063.8
2018
64116.99
2019
67322.83
2020
70688.97
Table 20 : projected demand for electric oven
44
Raw Material
Baking oven is made by the assembly of different parts of tubular metals, sheet metals,
insulating materials, electric resistors, and electric insulator materials. The main frame
of the oven is made from tubular metals; typically an electric cooking oven having an
external dimension of 100x100x200cms can bake 100 kgs of wheat bread in a day of 8
working hours. The external parts of the stove in touch with bread and exposed to steam
and heat are made of stainless steel since the material resists corrosion. All the raw
materials are to be imported, except the insulation materials which can be obtained in
the local market.
Technology
 Manufacturing process
The manufacturing of ovens consists of fabrication of RHS section metals and sheet
metal parts to form the finished part. The process involves cutting and joining by
welding of RHS metals and covering the whole structure by stainless steel sheets. The
process involves metal cutting, arc welding, sheet metal cutting bending and electric
spot welding.
12. Non-threaded Mechanical Fasteners Manufacturing Plant
Product description and application
A rivet is a mechanical fastener. It consists of a smooth cylindrical shaft with a head on
one end. On installation the rivet is placed in a pre-drilled hole. Then the tail is “Upset”
(i.e. deformed) so that it expands to about 1.5 times the original shaft diameter and holds
the rivet in place. To distinguish between the two ends of the rivet, the original head is
called the factory head and the deformed end is called the shop head or buck tail. There
are a number of rivets, designed to meet different cost, accessibility, and strength
requirements. These include: solid rivets, blind rivets, multi-grip rivets, grooved rivets,
peel type blind rivets, self-pierce rivets, plastic rivets, tubular rivet, etc.
45
Rivet has wide application in the structural parts of aircraft, in static structures such as
bridges, cranes and building frames. It is also used in manufacture or repair of truck
bodies.
Market Study
Rivets have wide application in the manufacturing sector as well as during maintenance
of various products. As there is no local production of rivets, the country’s requirement
is entirely met through import. Normal rivets and tabular or bifurcated type of rivets are
imported in a substantial quantity annually. Imported quantity of rivets for the past six
years is shown in Table 40.
CIF Value (USD)
Net _ Mass
rate (%)
2005
67,787
35,302
-
2006
147,182
35,524
0.6
2007
157,254
72,894
105
2008
63,532
32,005
-56
2009
91,464
42,422
33
2010
241,289
96,943
201
57
Average growth rate
Table 21 : import of rivets during the year 2005 to 2010
The demand for rivets is directly related with the manufacturing sector, especially with
the engineering industries. Although the manufacturing sector is planned to grow by
11.5% per annum the engineering industry requires some time to develop as it requires
relatively high knowledge and technology.
To estimate the current demand 2010 has taken as a base line year and accordingly the
current demand for rivet has been estimated as 96,000 units. The trend line shows that in
the year (2011-2020) in average the demand for rivet will increase by 6.9% and if the
trend keeps linear, the demand for the product will be anticipated to go up to 1,176,000
units by 2020.
46
year
Projected
demand
2011
84,000
2012
88,000
2013
98,000
2014
106,000
2015
114,000
2016
120,000
2017
130,000
2018
138,000
2019
144,000
2020
154,000
Average growth rate (%)
Table 22: projected demand for rivet
Raw Material
The raw materials used for the production of rivets are mainly mild steel and alloyed or
non-ferrous metals (Aluminum) depending upon the applications. The raw materials
have to be imported. Mild steel and aluminum are available in Ukraine, Turkey & India
and packing materials are found locally.
Technology
 Manufacturing Process
The raw material is fed into the shearing machine to form rivet by shearing length of the
rod and extruding. An aluminum rivet blank approximately the same diameter as the
head of the finished rivet is used. This rivet blank is forced into a die to extrude the
tapered region and the shank of the finished rivet. The fabrication process provides more
uniform cold working at the junction of the shank and the tapered region. This process
also can provide a superior surface finish, and is suitable for use in wet wing fabrication
without further processing for improved surface finish.
47
After the final product is manufactured will be transferred to the quality inspection and
packing department. Then ready for dispatch. The technological process has no any
adverse environmental impact.
48
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