The price of cement in the Nigerian market stays outrageously excessive as a 50kg bag of the product nonetheless goes for a mean of N12,000 in defiance to an intervention by the federal authorities and a menace to open doorways for importation of the product if the producers don’t scale back their costs.
A market survey by BusinessDay reveals {that a} 50kg bag of Dangote Cement sells for N12,500 whereas Lafarge sells for between N12,000 and N14,000 per bag. Although the most affordable, the BUA model sells between N10,000 and N11,000 per bag.
Different manufacturers like Ibeto Cement and United Cement Firm of Nigeria Restricted (UniCem) are promoting for N10,000 and N11,000 in addition to N12,000 and N14,000, respectively.
This reveals that Nigeria’s actual property, particularly the housing sector, is probably the most unsure and troubling occasion, which has seen many builders abandon their venture websites; in contrast, actions at different development websites have slowed considerably.
As a response to those costs, which began in the primary and second week of February, the federal authorities met with the essential cement producers and different related stakeholders where they agreed to peg the value of the product at N7,000 to N8,000 relying on the placement of the customer and the customer.
Regardless that the Minister of Housing and City Improvement, Ahmed Dangiwa, doesn’t see any justification for the value improvement, the producers informed David Umahi, Minister of Works, who chaired the assembly, that they had their challenges, itemizing them as excessive value of gasoline and excessive import responsibility on spare elements.
In keeping with them, challenges are poor street networks, excessive overseas trade charges and cement smuggling to neighbouring nations. They insisted that the only way the value of cement may come down was for the federal authorities to handle all the challenges they’d raised.
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“It’s disheartening to see how much Nigerians must pay for essential constructing commodities like cement, with the costs rising nearly daily. I don’t perceive the rationale for this improvement, and it’s unacceptable.
“The producers ought to clarify their causes for such incessant hikes to Nigerians. I know that the cement producers supply their uncooked supplies in Nigeria: limestone, clay, silica sand, gypsum, iron ore, and the remainder. These minerals abound in Nigeria, and these producers get them right here, so there isn’t a justification to blame all of it on the rise of the greenback“, he stated.
Dangiwa warned that the federal government is perhaps compelled to open the borders for cement importation if product producers fail to carry down the costs, expressing concern that the nation had witnessed an alarming increase in the prices of improvement in indifferent construction supplies.
“This can be a disaster for housing supply. A rise in important constructing supplies means a rise within the costs of homes,” the minister stated.
Like the minister, many Nigerians are at a loss, whereas the value of cement remains to rise on a month-to-month basis. The glue, which sells for between N10,000 and N14,000 at this time, was bought for between N5,000 and N6,000 in January. “It’s obscure what modified so abruptly,” said Vincent Ogili, a civil engineer supervising a constructing venture that has merely been placed on maintenance attributable to excessive enter value.
“The present shortage resulting in the excessive worth of the product available in the market is, to say the least, fairly inexplicable and incomprehensible to even probably the most discerning minds exterior the product manufacturing circle,” he added, noting that the value of gasoline shouldn’t be sufficient purpose for the current worth leap.
Ogili famous additional that Nigeria possesses the most essential cement business inside West Africa, with no less than 12 registered firms amounting to a merged cement capability of 58.9 metric tonnes per yr, including that Dangote Cement is the most critical cement producer in Nigeria and West Africa, manufacturing a mixed share of greater than 28.5 metric tonnes per year.
He identified, nonetheless, that Nigeria’s cement sector is marked by constant demand that lately has resulted in important home provide gaps. “Infrastructure tasks development – which made up 8.9 % of Nigeria’s 2022 authorities price range – the non-public retail sector, and the actual property sector are all driving this rising demand for cement.
Ogili recommended that the time has come to revisit the 2002 backward integration coverage of the Federal Authorities within the cement business, which, he recalled, led to the rise within the business’s annual manufacturing capability from two million tonnes in 2002 to about 29 million tonnes in several years.
