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Cement manufacturers in the country have agreed to slash the price of the commodity to between N7,000 and N8,000 per bag after the federal government’s intervention.
This was the resolution of a three-hour meeting between the manufacturers and a federal government team led by the Minister of Works, Engr. David Umahi, and the Minister of Industry, Trade and Investment, Dr. Doris Uzoka-Anite, at the Ministry of Works headquarters in Abuja on Monday evening.
The manufacturers identified the cost of gas, high import duty on spare parts, bad road network, high foreign exchange rate and the smuggling of cement across borders as factors responsible for the hike in the price of cement.
The government also expected the agreed price to drop further after securing the government’s interventions on the identified challenges of the manufacturers on gas, import duty, smuggling, and better road network.
The communique read by the Minister of Works after the meeting said: “The cement manufacturers and the Government noted that the current high price of cement is abnormal in some locations nationwide. Ideally, cement retail prices should not cost more than ₦7,000.00 to ₦8,000.00/50kg bag of cement.
“Therefore, the three cement manufacturers: Dangote Cement Plc, BUA Cement Plc and Larfarge Africa Plc have agreed that cement cost will not be more than between ₦7,000 and ₦8,000 per 50kg bag depending on the location.
“Going forward, Government advised cement manufacturers to set up a price monitoring mechanism to ensure compliance, and manufacturers have willingly accepted to do so and to sanction any of her distributors or retailers found wanting.
“Government expects the agreed price to drop after securing government’s interventions on the challenges of the manufacturers on gas, import duty, smuggling, and better road network. The meeting agreed to reconvene in 30 days to review progress made.”
The federal government has also declared its intention to encourage the introduction of six new manufacturers. The government, as part of the intervention, was also going to encourage at least six other cement-manufacturing companies to spring up.
On the part of government, Engr. Umahi said the Federal Ministry of Industry, Trade and Investment will approach Mr. President to address the cost of gas and import duties. The Federal Ministry of Works is to also give more attention to fixing the roads, especially around the locations of the manufacturers.
On the issue of smuggling cement across the borders, the Federal Ministry of Industry, Trade and Investment will deepen the already started engagement with the National Security Adviser (NSA) on how to stop the cross-border smuggling.
For his part, the Group Managing Director/Chief Executive Officer, Dangote Cement Plc, Arvind Pathak, said the manufacturers have agreed to a window of 30 days in which to address the crisis. “We had agreed to whatever the price of the cement in the various parts of the country,” Pathak stated.
The representative of BUA said the company was committed to bringing in an additional six million tonnes of cement in the next few weeks. He said the measurw would dampen the pressure of supply and they would remain committed.
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