http://www.leadershipeditors.com/ns/index.php?option=com_content&view=article&id=31550:cement-price-drops&catid=51:cover-stories&Itemid=142

Ten days after President Goodluck Jonathan gave cement manufacturers a 30-day ultimatum to reduce the price of cement, the price of the product has started coming down slowly.

LEADERSHIP findings revealed that the product which was sold for between N2, 700 and N3 000 is now sold for between N1, 900 and N2, 100 in different parts of the country.

A survey carried out in Lagos showed that the product was sold for between N1,900 and N2000. In some parts of the Federal Capital Territory (FCT) and in Mararaba, Nasarawa State, a satellite town near Abuja, the price of the product was between N2,000 and N2, 100.

The same goes for Enugu. A dealer told LEADERSHIP in a telephone interview that the product now sells for between N2,000 and N2, 100 depending on the location.

But some dealers said the price was still high compared to other countries of the world, even as they asked the government to break the monopoly in cement manufacturing.

LEADERSHIP findings revealed that a 50kg bag of cement is sold for the equivalent of N908 in India, which is a slight increase from the 2009 price of N875. The product is also sold for the equivalent of N700 in China, Liberia and Turkey.

Commenting on the matter, a cement dealer, Mr. Christian Agbo said the hike in price was as a result of the artificial scarcity created by manufacturers. Agbo, who is the managing director of Chris Okotie Investment, said the manufacturers were responsible for the price hike. He said that it would be difficult for the price to come down unless more people were given licence to either manufacture or import the product.

Agbo said the manufacturers whom he said do not have the capacity to produce the quantity of cement needed in this country have formed a cartel.

To Mr Emeka Ezeh, another dealer, the problem was caused by the distributors and agents who he said, connived with the manufacturers to increase the price. He also blamed the trailer drivers for charging so much to convey the product to various destinations on the pretext that the price of diesel was high.

According to Ezeh, a trailer driver charged N200, 000 to convey a trailer load of cement from Obajana cement factory in Kogi or Gboko Cement factory to Abuja. He said that the amount charged by the drivers depended on the distance.

Explaining further, Agbo said that the retailers are not allowed to buy directly from the manufacturers, but have to go through the agents who would buy from the distributors. “It is the agents that sell to us. As a retailer, you cannot pay directly to the manufacturer.”

In a letter to the president dated May 9, 2011, the chairman of the Cement New Entrants Forum of Nigeria (CNEFN), Prince David Iweta, asked the federal government to allow its members to import one million tonnes of cement every year for a period of five years since the manufacturers could not meet the demand.

He said that following the cement manufacturers’ recommendation, government increased duty and levy on imported bulk cement from 5 to 15 per cent and introduced Cement Technology Levy (CTL) of 20 per cent, thereby pushing the landing cost of imported cement to N1, 700 per bag. According to him, a bag of locally produced cement should be sold for between N500 and N700.

Iweta, who is the chairman of Madewell Portland Cement, Sapele, Delta State, said that members of the CNEFN, notably himself, chairman of Reagan Portland Cement Chief Reagan Ufomba, chairman of Magin Roi Portland Cement Mr. Kola Sowande and chairman of Gateway Portland Cement, Chief Emmanuel Odegbami had sustained cement price stability at N1, 600 per bag from 2008 – 2010 before the present crisis.

He asked the federal government to reverse levies on imported bulk cement to five per cent and approve the licence of some cement companies which applications were currently with the Ministry of Commerce and Industry.

A market survey carried out in Lagos revealed that the major distributors of the product may have been boxed to a tight corner as they have started reducing the price of the product.

Also speaking, Alhaji Alani Sullaymon of Alani & Co Limited said: “I decided to be selling the goods I have for N1,900 to dispose of what I have in stock, not because the manufacturers have beat down their price. Government is very powerful; they can crash the price and I would lose a lot of money .But now that I am selling for N1900 I have not gained and have not lost my money.”

It's still high sef. Crash it to N1,000 and we know GEJ has done it.

jackpot:

It's still high sef. Crash it to N1,000 and we know GEJ has done it.

the price of cement, the price of the product has started coming down slowly.

Based on the artcle,the price has started coming down and may eventually get to the amount you envisage

^^your response sounds like a politicians. Lol!

@op you are right the price of cement has come down to N 1,900!

I just bought a brand I use to buy 2400 before the Ultimatum!!! to those who called GEJ clueless when he made the pronouncement they can now see that they are the fools!!!! CLUELESS that no notting about nigeria even the person they supported in the person they supported in the last presidential election is also a clueless and a fool

jackpot:

^^your response sounds like a politicians. Lol!

If you mean a member of any of the political parties in Nigeria,I am not.But if by human nature,of course we all are,including you

still high. How much does it cost to produce a bag of cement locally?

How much is cement in Ikorodu?

So his economic road-map is ultimatums - I See

If it was Buhari that did this many of you will skin yourselves - Hypocrisy at best.

Let the truth be known, we need economic policies that are sustainable - not Fire Brigades.

Paying 2 or 3X the cost of cement elsewhere and you guys are smiling.

Smh.

Dangote has you by the balls and is squeezing tight, and ya'll are praising GEJ.

Pathetic

I wonder how much cement is imported through Benin Republic. That is what I'd look into doing if I had the chance. You could probably make a killing importing through that border for N700 or N800 + bribes and then reselling for N2K+

.

by 'manufacturers' they mean dangote right? Or am I mistaken into believing the man has sole monopoly on the Nigerian cement market?

^
Dangote isn't the only one producing cement in the country, though his company is a major player. Some other major players are elephant and ashaka(lafarge), unicem, etc

it's rainy season!!

If we are having Ecowas let us have proper Ecowas with all the benefits. I can go to france and buy my cement and nobody would hold me or charge me descriminately. If cement is N700 Naira in Cotonu, Nigerians should be allowed to go to that country and purchase it for that price without attarcting any tax or a minimal tax let say N50 Naira for every bag bought thereby costing the importer N750.00 FROM Cotonou.

This would force Dangote and other oligarchs to drop their prices saving everyone these unecessary hassle of over-inflated prices.  

MORE FIRE FI BLOODSUCKERS,,,,just a matter of time, fowl yansh go opin o, mumu monopolists dem

karl max:

@op you are right the price of cement has come down to N 1,900!

I just bought a brand I use to buy 2400 before the Ultimatum!!! to those who called GEJ clueless when he made the pronouncement they can now see that they are the fools!!!! CLUELESS that no notting about nigeria even the person they supported in the person they supported in the last presidential election is also a clueless and a fool

easy, abeg.

good

karl max:

@op you are right the price of cement has come down to N 1,900!

I just bought a brand I use to buy 2400 before the Ultimatum!!! to those who called GEJ clueless when he made the pronouncement they can now see that they are the fools!!!! CLUELESS that no notting about nigeria even the person they supported in the person they supported in the last presidential election is also a clueless and a fool

Learn how to read. The main reasons for the high prices of cement are the activities of the cartel of importers and manufacturers. Throwing manufacturing and importing open to all will crash the price to manageable levels, but your god GEJ will not take this step. Instead they offer you crumbs and here you are licking their boots and grovelling.

texazzpete:

Learn how to read. The main reasons for the high prices of cement are the activities of the cartel of importers and manufacturers. Throwing manufacturing and importing open to all will crash the price to manageable levels, but your god GEJ will not take this step. Instead they offer you crumbs and here you are licking their boots and grovelling.

Thank you o, I tire for Nigerians and their reasoning.

if he wanted d price 2 come down he could hv open da boarders like he did 2 textile or is it cos wife wanted 2 import so he made it legal 4 her

@Dis Guy
I love your comment "it's rainy season!!" GEJ na theif is just trying to make sales for Dangote and co.

KnowAll:

If we are having Ecowas let us have proper Ecowas with all the benefits. I can go to france and buy my cement and nobody would hold me or charge me descriminately. If cement is N700 Naira in Cotonu, Nigerians should be allowed to go to that country and purchase it for that price without attarcting any tax or a minimal tax let say N50 Naira for every bag bought thereby costing the importer N750.00 FROM Cotonou.

This would force Dangote and other oligarchs to drop their prices saving everyone these unecessary hassle of over-inflated prices.  

Ecowas is different from the EU because our level of integration is not the same, you should look into the level we are presently. I don't think we have a common customs union right now, only free movement of people and some little stuffs. We are actually rushing things and not doing it in the right stage or direction and also some weaker countries should join later while the stronger countries like Ghana and Nigeria should forge ahead and create the needed rules.

The reason why everything (cement, rice, etc) costs more in Nigeria is that the government is using regulation to create artificial monopolies for the likes of Dangote, probably in exchange for bribes. Every time the government bans or limits the importation of anything its almost always because they've been bribed by local manufacturers or big man importers.

The abnormally high price of cement does far more harm to the economy than our lack of a local cement industry. Protecting local business is just an excuse they use to fool the ignorant masses. Anyone who knows anything about economics knows that protectionism is ultimately bad for any economy.

The only way to crash the cement price is to allow anybody with the means to import it as long as their product meets minimum standards. Let the free market dictate the price. We've had enough of people like Dangote r@ping our economy with their government mandated monopolies.

If GEJ wanted to stop this nonsense, he could do it today with a stroke of the pen. Unfortunately, because he's PDP and has been a senior member of the corruptocracy for years, there's little to no chance of that happening.

egift:

So his economic road-map is ultimatums - I See

If it was Buhari that did this many of you will skin yourselves - Hypocrisy at best.

Let the truth be known, we need economic policies that are sustainable - not Fire Brigades.

Spot on man

+1 gej

M M M:

+1 gej

-10= -9

How cement no go cost when train no dey work, Na soo one man trailers full Nigerian roads, damaging the road

The problem is that lazy traders/ importers are not interested in manufacturing cement locally. We have limestone in 21 out of 36 states in Nigeria. Why should we allow folks to go all the way to china to import dust when the raw materials to make that dust is abundant in our backyard?

The FG has had a backward integration policy since 2001 and it was that only people who invested in local cement manufacturing would be allowed to import. It was what forced Dangote and Flour Mills (UNICEM)  to become local cement manufacturers and even expand. If anyone has the millions of $$ to import, they should invest that money in building a local cement plants. Otherwise, they should NOT be allowed to import!!

They want to destroy our local cement industry the same way they destroyed our local textile industry by flooding the country with cheap substandard imports from china. Tens of thousands of jobs has been lost because of this . The FG has committed to banning cement imports by 2013 and existing manufacturers are spending billions in capacity expansion and building greenfield plants e.g Ibeshe, Lakatabu, Okpella.

It would be grossly unfair to bait manufacturers into borrowing billions of dollars to set up new plants and expand only to now open the floodgates for importers to bring in cheaper products. Competition will only be fair when those importers with money set up their own cement plants in Nigeria and compete with existing manufacturers.