FCCPC probes cement makers over possible price manipulation

The Federal Competition and Consumer Protection Commission (FCCPC) investigation has suggested “possible manipulation of prices of cement in the Nigerian market” and has commenced a probe against key players in the sector.

This is based on findings from its industry-wide investigation, according to a statement issued by Ondaje Ijagwu, FCCPC Director, Corporate Affairs.

The report was based on concerns raised over the comparatively high retail price of cement in Nigeria compared with other markets, despite the country’s substantial limestone deposits, significant domestic production capacity and reported surplus installed capacity relative to domestic consumption.

What the FCCPC is saying

The FCCPC’s finding is based on the preliminary field reports collated following a three-month cross-border study by the Anticompetitive Practices Department (ACP) of the Commission, undertaken in response to widespread public complaints over the high cost of cement, a common staple in the country’s construction industry.

All the major cement manufacturers in the country were said to have cooperated with the Commission by making their records available except one of them.

• “Publicly available estimates indicate that three major undertakings account for more than 90 percent of installed production capacity in the country. 
• “The ACP investigations extended to markets in Sub-Saharan Africa like Kenya, Tanzania and South Africa as well as Egypt, Morocco and Algeria. 
• “Metrics adopted included the availability of limestone, the basic raw material for cement production, as well as other variables such as population, production capacity and consumption,” the statement stated.

The Commission stated that in Kenya, the 58.6 million population (76% lower than Nigeria’s) has domestic cement demand of approximately 9.3m MTPA (metric tonne per annum) in 2025, while the retail price in Nairobi is $5.40 (N7,344) despite Kenya being endowed with limestone.

• “In Tanzania, with a population of 66.3m (72% lower than Nigeria’s) and domestic cement demand is 9.3m MTPA (2025), a bag of cement sells for $4.80 (N6,528). 
• “In Togo, a bag sells for $6.75 (N9,180). Significantly, Togo does not have a limestone deposit,” the statement added.

Comparatively, FCCPC stressed that in Nigeria, market intelligence reviewed by the Commission shows that the retail price of a 50kg bag of cement rose significantly during the first half of 2026.

• “A bag reportedly selling for between N9,300 and N9,700 in January was selling for between N10,500 and N13,000 by mid-year. By July, prices of between N13,000 and N15,000 were reported in some parts of the country.
• “The Commission’s survey indicates that Nigeria has installed cement production capacity of more than 60 to 65 million metric tonnes annually, while estimated domestic consumption is approximately 25 to 30 million metric tonnes. Nigeria is also a net exporter of cement to neighbouring markets,” the Commission added.

The FCCPC stated that of particular concern is that this level of production capacity has not resulted in the downward pressure on domestic prices that might ordinarily be expected in a competitive market with substantial excess capacity.

More details

According to the Commission, information provided by industry participants has identified energy costs, depreciation of the Naira and its effect on imported machinery and spare parts, as well as transportation and logistics costs, among the factors contributing to cement prices.

Ijagwu stressed that the Commission is testing these explanations against verified information on costs, production, pricing and market conditions.

He added however, that the weight of preliminary findings provides sufficient grounds for its investigation to continue.

• “Next is to determine whether prevailing cement prices can be explained by legitimate costs and market conditions, or whether there is evidence of coordinated conduct, abuse of market power, restriction of domestic supply, anti-competitive distribution practices or other conduct contrary to the provisions of the FCCPA,” he stated.

He disclosed that the FCCPC has now issued Notices of Commencement of Investigation and Summons to Produce to “the key players in the sector.”

• “The companies are required to provide information and records relating to, among other matters, their pricing methodologies, production and capacity utilisation, exports and relevant commercial relationships,” the statement partly reads.

Explaining the basis for the Commission’s intervention, the Executive Vice Chairman/Chief Executive Officer of the FCCPC, Mr. Tunji Bello, said the investigation reflects the Commission’s responsibility to examine market conditions that have significant consequences for consumers and the wider economy.

Bello explained that competition scrutiny is not intended to dictate the commercial decisions of businesses.

• “Rather, its purpose is to determine whether the market is functioning competitively and whether consumers are receiving the benefits that effective competition should provide,” he stated.

He highlighted that the purpose of its probe is to protect the competitive process, so that prices, output and other market outcomes are determined by genuine competition rather than conduct that unlawfully restricts it.

Get up to speed

Nigeria’s top cement makers generated a combined N3.2 trillion in revenue during the first half of 2026 as price hikes, rising housing developments, construction activity and infrastructure projects fuelled demand and pushed earnings to record levels.

• Nairametrics reports that Nigeria’s cement industry has consistently reported rising revenues on the back of higher sales volumes and periodic price adjustments. H1 2026 is a continuation of the first quarter (Q1) 2026 performance of the three biggest cement producers.
• Combined revenues for Dangote Cement, BUA Cement and HBM Nigeria rose from approximately N1.93 trillion in 2021 to N6.55 trillion in 2025, representing a 3.4-fold increase in naira terms.
• Despite naira revenues more than tripling, the industry’s dollar value declined from about $4.7 billion in 2021 to approximately $4.2 billion in 2025 as the depreciation of the naira eroded the real value of corporate earnings.

Dangote Cement shares have declined 6% over the past week to N965 but remain up 68% over the past year, trading at a price-to-earnings multiple of approximately 14.4x.

• BUA Cement shares have also fallen 6% over the past week to N296 but remain up 74% over the past year, trading at roughly 21.4x earnings.
• HBM Nigeria shares have moderated from N389.90 as of July 28, closing at N267.40 on Wednesday, August 5 despite its improved earnings report.

The stock had surged by 149% over the past year following record dividend declarations. The stock currently trades at approximately 17x earnings.

The elevated valuations across all three cement producers suggest investors continue to price in sustained revenue and profit growth, reflecting expectations that Nigeria’s construction boom and infrastructure investments still have considerable room to run.

What you should know

The FCCPC is a Federal Government regulatory agency statutorily empowered to provide speedy redress to consumer complaints, among other functions.

In 2024, the Commission criticized dealers for inflating the price of BUA Cement to N7,000 and N8,000 per bag, compared to the company’s recommended price of N3,500 at the time.

The Commission, however acknowledged concerns trailing the removal of fuel subsidies and fluctuations in the foreign exchange market.