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The Federal Government, together with cement manufacturers such as BUA, Dangote and Larfarge, has set the price range for a 50kg bag of cement at N7,000 to N8,000 across various locations in the country.
This price adjustment was announced by Senator David Umahi following an extended discussion with key players in the cement industry held in Abuja on Monday.
Despite the agreed price reduction, manufacturers emphasized that the decrease from the current market rates is contingent upon the government’s commitment to address significant challenges within the sector.
The initiative, spearheaded by President Bola Tinubu, aims to tackle the surge in cement prices, which Senator Umahi described as excessive and counterproductive to the economic growth ambitions of the government.
Factors responsible for the hike in cement prices
In his remarks, the minister highlighted several factors contributing to the inflated costs, including smuggling, poor road conditions, elevated energy expenses, and the foreign exchange dilemma.
He, however, noted the manufacturers’ willingness to reduce prices provided these issues are effectively addressed by government interventions.
He stated, “Ideally, they noted that cement price and retail price to a consumer should not cost more than between N7,000 and N8,000 per 50 kg bag of cement.
“Therefore, the government and the cement manufacturers, which is Dangote Plc, BUA Plc and Lafarge Plc, have agreed to peg their cement price nationwide between N7,000 and N8,000 per 50 kg bag of cement, depending on the location.
“Which means that this price depends on the location. Going forward, the government advised manufacturers to set up a price monitoring mechanism to ensure compliance with the prices that are set today.”
In the past few weeks, the price of a 50kg bag of cement increased to an all-time high of over N9,500 across different cities in the country. The cause of the spike has been attributed to increase in energy cost and other operational expenses.
A market survey by Nairametrics last week revealed that the price of cement in many retail outlets across Lagos has increased to N9,500 and for some brands, at N10,000. Multiple reports in the media noted that the price of the commodity had surged to between N12,000 N15000 in Abuja and other cities in the country. This necessitated the meeting between the works minister and the cement producers.
The Minister of works, Sen. Dave Umahi had earlier stated his intention to build roads across the country with concrete rather than the traditional asphalt.