The Manufacturers Association of Nigeria (MAN), has warned that Nigerian manufacturers are set to encounter difficulties meeting production of goods as the cost of diesel hits N730 per litre.
This was disclosed in a statement by Mr Lanre Popoola, Chairman, Manufacturers Association of Nigeria (MAN), Oyo, Osun, Ekiti and Ondo on Sunday, according to the News Agency of Nigeria.
He also urged for the government’s intervention through palliatives to enable manufacturers to handle the costs.
Read: Diesel prices hit N630 per litre as filling stations hoard product
What MAN is saying
Popoola said, the current costs of diesel has made it difficult to ensure production at this time, as diesel has gone up to N720 and N730 per litre.
“It is getting extremely difficult to produce and I don’t know how we are going to cope because 70% of industries are running on diesel, there is no light.
“There is no power supply, we are having 30 per cent of what it used to be, whereas the disposable income of people is not increasing and the cost of products are going up.
“Even in my factory now, we are only running one shift instead of three shifts of eight hours each,” he said.
He urged that many businesses are currently running limited hours on diesel as they cannot afford to use generators all day, citing that diesel suppliers cannot agree for organizations to make a flexible payment plan such as instalments, while they deliver the products in trust.
Read: MOMAN explains why cost of diesel, aviation fuel is high
“They cannot again supply you with diesel and allow you to pay in two weeks. It is either you do cash and carry, or pay ahead because they too cannot predict the cost of the product.
“Aside from manufacturers, for transporters that are bringing food from the North or taking products to the East or Lagos, now the cost of their logistics would have doubled by 100 per cent if not 200%.
Popoola urged that the FG should come into the situation and enable palliatives for manufacturers, citing it is either they have light 24 hours per week, to run the factories or do a palliative on diesel.
Read: What a $200 per barrel oil would mean for the Nigerian economy
What you should know
- Oil marketers under the aegis of the Major Oil Marketers Association of Nigeria (MOMAN), attributed the recent surge in Automotive Gas Oil (AGO), otherwise known as diesel and Jet A1 (Aviation fuel) to the difficulty in accessing foreign exchange and the ongoing war between Russia and Ukraine.
- As at the 9th of March, Nairametrics reported that the average cost of diesel had risen to about N625 per litre in some of the filling stations that were willing to sell in Lagos State, with some of them selling for as high as N630 per litre.
This is a real performance from APC.Nigeria now is at the next level.