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Why Price Of Cement Is High In Nigeria — Dangote
- The management of Dangote Cement Plc has said that the price of a bag of cement from its factories across Nigeria is N2,450, in Obajana and N2,510 in Ibese.
- EKO HOT BLOG, however, gathered that the prices of cement range from N3,300 to N3,500 in Lagos and Ogun states since March 2021.
The management of Dangote Cement Plc has said that the price of a bag of cement from its factories across Nigeria is N2,450, in Obajana and N2,510 in Ibese.
The company’s Group Executive Director in charge of Strategy, Portfolio Development, and Capital Projects, Mr Devakumar Edwin, made the disclosure in a statement on Tuesday.
According to him, these were the prices of cement which included the Value Added Tax (VAT) as of April 12.
It was, however, gathered that the prices of cement range from N3,300 to N3,500 in Lagos and Ogun states since March 2021.
Speaking on the increment, Edwin attributed the high cost of cement in Nigeria to the global rise in demand for cement as a result of the COVID-19 crisis.
He said, “Nigeria is no exception as a combination of monetary policy changes and low returns from the capital market has resulted in a significant increase in construction activity.
“To ensure that we meet local demands, we had to suspend exports from our recently inaugurated export terminals, thereby foregoing dollar earnings.”
Edwin added that the company had also reactivated its 4.5million ton capacity Gboko Plant which was closed down four years ago and the company is running it at a higher cost.
“This is all in a bid to guarantee that we meet demands and keep the price of cement within control in the country.
“Over the past 15 months, our production costs have gone up significantly,” he added.
He further stated that “about 50 per cent of our costs are linked to the USD, so the costs of critical components such as gas, gypsum, bags, and spare parts; have increased significantly due to the devaluation of the Naira and VAT increase.
“Despite this, Dangote Cement has not increased ex-factory prices since December 2019 till date while prices of most other building materials have gone up significantly.”
According to him, the company had only adjusted its transport rates to account for higher costs of diesel, spare parts, tyres, and trucks’ replacement, noting that the clarifications become necessary in view of the recent insinuations that the company sells cement in Nigeria at higher prices relative to how much it sells it in other countries, particularly in Ghana and in Zambia.
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