Breaking: Cement Price Crisis Deepens in Nigeria

Nigeria now has a fresh increase in price of cement and related products, dashing the hopes of many.

The increase has already triggered ripple effect in the open market, where prices have gone up by as much as 60 per cent in recent weeks.

The rising prices have also worsened construction costs, reeling under pressure from disruptive policies and ineffective housing supply.

The Guardian investigation revealed that the export of the product to neigbouring countries, despite huge domestic demand, may be responsible for the shortage.

The Federal Government recently granted Dangote Cement and BUA permission to transport products across the border, despite closure. Cement and by-products in neigbouring countries command higher prices.

Distributors hinted that there was increase of ex-factory prices due to economic realities, which prompted many dealers to change prices. For instance, Dangote Cement increased its ex-factory price to N3, 050 due to logistics and production cost.

However, other sources also attributed the scarcity to machine breakdown in one of the major player’s plant, which had been fixed, and industrial strike by cement truck drivers for improved welfare.

But the Executive Secretary, Cement Manufacturing Association (CMAN), Mr. James Salako, disagreed. He said no manufacturer had increased price of cement.

The current price of a 50-kilogramme bag now goes for N3, 600 in Lagos and Cross River states; N4,000 in Enugu and Imo states; Rivers state N4,300; Abuja N3,200; Kano and Oyo states N3,500.

Until the last quarter of the year, cement was sold for between N2400 and N2500 in many of the states.

Nine-inch block in Enugu is sold at N200, and six-inch block goes for N160 per block, in Kano, nine inches block sells for N170 and six inches for N160 as against the previous N150 and N140 respectively.

A cement dealer at the Kenyetta market, Enugu, Chief Donatus Eneh, told The Guardian two weeks ago that he paid for a full truck of Dangote Cement over four months ago but had not received the consignment.

“They have continued to promise on daily basis the product will be supplied to no avail. I don’t even have stock to sell at the moment.

“Last week, I had to buy from one of the dealers to enable me supply to one of the building sites. In some locations, developers have stopped building because cement is scarce,” he said.

Asked why the commodity suddenly became scarce, he said that Dangote, a major manufacturer had not been manufacturing and supplying optimally. Other manufacturers, he said, had not been able to meet market demand.

Also, Mrs. Uju Onah, who operates a block industry along One Day Road, Enugu, said high price of cement had seriously affected her business.

“Everything is on the increase. We cannot find cement to buy. We buy N4,000 per bag and mould. Initially, we were buying N2,400 but that is not possible any longer.

“They said, people are burning trucks belonging to the cement companies and that is affecting distribution,” she said.

Similarly, in Imo State, a major dealer, John Igwe, said: “We bought cement from the accredited dealers and are not making profit of more than N150 per bag. If we calculate the cost of transportation and labour, you find out that we are making little or no profit.”

In Cross River State, a cement dealer, Mr. Edet Edet, at Garden Street, a popular building materials market, said: “Cost of delivery by transporters has gone up though the cost from the factory in United Cement Company of Nigeria Limited (UNICEM), a subsidiary of Lafarge remains the same.

“So because of this, we have to transfer the cost to consumers. In addition, many people build in dry season and there is high demand.”

Cement dealers and consumers in Rivers State blamed the hike in price on monopoly in the industry.

A dealer, Mr. Ordu Godspel, told The Guardian government closed Eagle and Ibeto Cement from which he was making fortune as dealer and allowed only few to produce locally. “We were hopeful, thinking that the price of cement would come down from what it was at N1,500, but sadly, the manufacturers increased their prices to N2,400 in 2016 and since then, the price kept rising.”

“The current price is because Dangote stopped using his trucks to ship cement from its plants in Kogi and Benue to Rivers State. So, the distributors here now travel to those areas to load cement.

“Hence, all the logistics they incurred from hiring trucks, paying drivers, settling of security agencies are transferred to consumers, that’s why we the dealers get it at N4,000 and sell at N4,300.”

Locally. “We were hopeful, thinking that the price of cement would come down from what it was at N1,500, but sadly, the manufacturers increased their prices to N2,400 in 2016 and since then, the price kept rising.”

“The current price is because Dangote stopped using his trucks to ship cement from its plants in Kogi and Benue to Rivers State. So, the distributors here now travel to those areas to load cement.

“Hence, all the logistics they incurred from hiring trucks, paying drivers, settling of security agencies are transferred to consumers, that’s why we the dealers get it at N4,000 and sell at N4,300.”

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