During a visit to the Presidential villa to invite Acting President Yemi Osinbajo to commission one of his cement factories, Alhaji Abdulsamad Rabiu said the three major cement producers were very keen on reducing cement prices significantly. While he did not mention the firms specifically, the three major cement producers in the country are Dangote Cement, Lafarge Africa and BUA Cement.
Alhaji Rabiu said the price reduction was being considered because forex rates had fallen significantly and availability had also improved. The cost of Low Pour Fuel Oil (LPFO) used to power some cement plants had also gone down. He also stated that the price reduction was around the corner. “ I can assure you that the three major companies producing cement in Nigeria are working very hard to see that the price of cement comes down in the very near future.”
While the reasons given are cogent, the fall in cement prices may not be a permanent one. Nigeria is heavily dependent on crude oil for foreign exchange and crude oil prices are volatile. Cement prices tend to fall in the rainy season due to a lull in construction work, and then rise during the dry season as construction resumes.
Dangote cement has also emerged as a price setter in the industry, and the company could decide to adjust its prices upwards or downwards at any point in time due to its large production volumes and network of plants spread across the country.