Dangote Cement Breaks Silence on High Prices as Dealers Release New Rates Nationwide
- Dangote Cement's chairman, Emmanuel Ikazoboh, has cited rising energy costs and exchange rates as factors driving high cement prices in Nigeria
- Current retail prices for a 50kg bag range from ₦9,500 to ₦13,000, affecting construction nationwide
- Amid this, homeowners and developers expressed concern as sustained price increases impact building material affordability
Pascal Oparada is a journalist with Legit.ng, covering technology, energy, stocks, investment, and the economy for over a decade.
The chairman of Dangote Cement Plc, Emmanuel Ikazoboh, has explained why cement prices remain high across Nigeria, attributing the persistent increases to rising energy costs and the impact of foreign exchange on production expenses.
His comments come amid growing concerns from Nigerians over the soaring cost of building materials, with many calling on the government to intervene as cement prices continue to put pressure on construction projects and housing development.
Source: Getty Images
Speaking during the 17th Annual General Meeting (AGM) of Dangote Cement Plc in Lagos, Ikazoboh said energy remains the biggest cost component in cement manufacturing, accounting for about 60 per cent of total production expenses.
Energy, dollar exchange rate driving costs
According to Ikazoboh, cement manufacturers rely heavily on gas, coal, and diesel to power their operations. He noted that gas, one of the key energy sources, is sold in United States dollars, exposing manufacturers to exchange rate fluctuations.
He explained that the continued depreciation of the naira against the US dollar has significantly increased production costs, making it difficult for manufacturers to maintain lower prices.
"To produce a bag of cement, we need energy, which constitutes about 60 per cent of the production cost. To generate that energy, we use gas, coal or diesel," he said.
"Gas is sold to us in US dollars, and its price continues to increase. We all know the impact of the exchange rate between the dollar and the naira. As a result, the cost of generating energy keeps rising."
His remarks offer one of the clearest explanations yet from the country's largest cement producer on the factors behind recent price increases.
Latest cement prices across Nigeria
Checks across major markets indicate that the retail price of a 50kg bag of cement currently ranges between ₦9,500 and ₦13,000, depending on the brand, location, and individual dealer.
Dangote Cement is currently sold for between ₦10,000 and ₦12,500 per bag in many parts of the country.
Meanwhile, BUA Cement and Lafarge Cement generally retail between ₦8,500 and ₦10,500, although prices differ across states due to transportation costs, dealer margins, and proximity to manufacturing plants.
In some remote locations, consumers may pay even higher prices because of increased logistics and distribution expenses.
Cement prices: Nigerians lament impact
The sustained rise in cement prices has continued to affect homeowners, contractors and real estate developers, many of whom have expressed concern over the increasing cost of construction.
Industry observers noted that beyond energy expenses, factors such as inflation, transportation costs, exchange rate volatility, and supply chain challenges have all contributed to higher retail prices nationwide, according to a report by The New Telegraph.
Source: Getty Images
Despite expectations that increased local production would help stabilise prices, manufacturers say macroeconomic pressures continue to weigh heavily on operating costs.
For now, cement buyers across Nigeria are expected to continue paying between ₦9,500 and ₦13,000 per 50kg bag unless there is a significant improvement in exchange rate stability, energy costs, and broader economic conditions.
BUA Chairman mentions forces behind high cement prices
Earlier, Legit.ng highlighted facts about the soaring cement prices in Nigeria, which have now surpassed N12,000 per bag, significantly impacting housing accessibility for many.
As billionaire businessman Abdul Samad Rabiu points out, the confluence of foreign exchange pressures, escalating energy costs, and increasing transportation fees is pushing the industry towards a pricing crisis that threatens the government's efforts to alleviate the nation's housing deficit.
Proofreading by James Ojo, copy editor at Legit.ng.
Source: Legit.ng
