Nigeria: Gboko cement plant reopens

Nigeria: Gboko cement plant reopens
11 February 2013

The reopening of Dangote Cement plant Gboko in Benue state on 1 February 2013 by the management came as a relief to the people of the state, especially those who earn their daily bread from the company. The factory, which was closed down last year as a result of the glut in the domestic cement market, said it will operate at half capacity for now.

The decision to reopen the plant was reached immediately after a meeting between President Goodluck Jonathan and the Chairman of Dangote Cement, Alhaji Aliko Dangote in Abuja.

Giving reasons for the reopening, a source at Dangote Cement said: “Since the shutdown of the plant, the government has been engaging local cement manufacturers in discussions, trying to find solutions to the challenges facing the industry."

The chairman of Gboko Local Government Area of Benue state, Nahan Zenda, decried the closure of the Dangote plant, saying his local government has lost about NGN15m (US$0.95m) to the development.
“Since the company was closed down, cement prices have gone up. Our people have been jobless and suffering. It may also lead to anti-social behaviours. Our women who are doing petty businesses outside the gate of the company are also complaining bitterly”, he lamented.

Grace John, who spoke on behalf of the women traders in Gboko, said social and commercial activities virtually came to a halt during the period the cement company was closed down.

The re-opening of the Gboko cement plant came just as the federal government, through the Minister of Trade and Investment, Olusegun Aganga, intervened in the manufacturers-importers face-off, saying the manufacturers have saved the nation NGN200bn in foreign exchange in 2012 that could have gone into cement importation.

The state’s Commissioner for Information, Conrad Werbga, said: “Importation impacts negatively on the economy. It causes lots of ripples. It comes with attendant negative consequences for our nation. The federal government must do all it could to reverse the trend. We must start looking inward. It is very worrisome for the Benue people because the closure of Dangote Cement will come with socio-economic consequences for our people.”

The Cement Manufacturer Association of Nigeria (CMAN) has also warned that Nigeria risks losing a huge investment as a result of the unnecessary importation of cement.

The chairman of CMAN, Joseph Makoju, was quoted as saying, “Energy cost accounts for over 35 per cent of production cost in Nigeria, whereas it is 10 per cent in China. In Nigeria, the price of LPFO has jumped from NGN25 per litre to NGN107.76 per litre as at November 2012, an increase of 331 per cent. Haulage is another factor that is out of the control of manufacturers. Haulage cost alone accounts for between 20 and 25 per cent of the open market price of cement. All bulk products are affected by this factor due to deplorable state of Nigerian roads.”

He decried the glut situation, saying the 18.5Mt of cement production target reached by local producers was at risk.

Published under Cement News