Dangote defends Nigerian cement prices

Dangote defends Nigerian cement prices
13 April 2021

Dangote Group’s Executive Director, Devakumar Edwin, has confirmed that its ex-factory price for bagged cement in Nigeria is between NGN2450 (US$6.43) in Obajana and Gboko and NGN2510 in Ibese.

The clarification has been made amid reports that the company sells cement in Nigeria at higher prices than in its other markets, particularly in Ghana and Zambia, according to Vanguard. While a bag of cement sells for an equivalent of US$5.1 in Nigeria, it sells for US$7.2 in Ghana and US$5.95 in Zambia, said Mr Edwin.

He also noted that although the company has direct control over its ex-factory prices, it could control retail prices.

"To ensure that we meet local demand, we had to suspend exports from our recently commissioned export terminals, thereby foregoing dollar earnings. We also had to reactivate our 4.5Mta capacity at Gboko, which was closed 4 years ago, and run it at a higher cost all in a bid to guarantee that we meet demand and keep the price of cement within control in the country," said Mr Edwin.

"Over the past 15 months, our production costs have gone up significantly. About 50 per cent of our costs are linked to USD so the cost of critical components like: gas, gypsum, bags, and spare parts; has increased significantly due to devaluation of the naira and VAT increases. Despite this, DCP has not increased ex-factory prices since December 2019 while prices of most other building materials have gone up significantly."

Published under Cement News