In a significant move, Nigeria's leading cement manufacturers, Dangote, BUA, and Lafarge, have reached a consensus that the retail price of a 50kg bag of cement will not surpass the range of N7,000 to N8,000.
This decision was made public following a meeting with David Umahi, the Minister of Works, and Doris Uzoka-Anite, the Minister of Industry, Trade and Investment, along with representatives from the cement companies and the Cement Producers Association.
This development comes in the wake of soaring cement prices across the country, with costs reaching up to N13,000 in some retail outlets in Abuja. A communique released after the meeting revealed that the manufacturers acknowledged the inflated prices in certain regions, while maintaining that the retail price should not exceed N8,000 per 50kg bag of cement.
Mr Umahi stated, "The essence of this meeting is the concern of the public and also the fact that this ministry since August has been preaching on how we can utilise our local contents in the construction of our roads. At the time we think we are winning we are now having these issues."
He further explained that a combination of factors, including smuggling, poor road conditions, high energy costs, and the forex crisis, contributed to the price hike. However, the manufacturers have expressed their commitment to reducing the prices in the future.
The communique also highlighted that the government and the cement manufacturers agreed that the current high price of cement is abnormal in some locations nationwide. It read, "Ideally, cement retail prices should not cost more than N7,000.00 to N8,000.00/ 50kg bag of cement. Therefore, the three cement manufacturers: Dangote Cement Plc, BUA Cement Plc and Lafarge Africa Plc have agreed that cement cost will not be more than between N7,000.00 and N8,000.00/50kg bag depending on the location."
In a bid to ensure compliance, the government has advised cement manufacturers to establish a price monitoring mechanism. The manufacturers have willingly agreed to this proposal and have also put measures in place to penalise any distributors or retailers found to be in violation of these guidelines.
"The government expects the agreed price to drop after securing the government’s interventions on the challenges of the manufacturers on gas, import duty, smuggling, and better road network," the communique added.
Expressing her concerns, Ms Uzoka-Anite noted that despite the regulatory policies and the Backward Integration Programme (BIP) introduced by her ministry to manage cement price and development, the price of cement continues to surge. She voiced her apprehension that the BIP's objective of managing and developing the cement manufacturing industry is not yielding the expected results.