Reps Summon Dangote, BUA over Cement Prices

In order to discuss solutions to the suffering caused by the high cost of the product, the House of Representatives has decided to summon cement manufacturers, such as Dangote Cement and BUA Cement, to appear before them.

Following the adoption of a motion titled “Arbitrary increase in the price of cement by manufacturers of cement in Nigeria,” during Wednesday’s plenary session, members of the House representing the Karu/Keffi/Kokona Federal Constituency in Nasarawa State, Mr. Gaza Gbefwi, and the Shomolu Federal Constituency in Lagos State, Mr. Ademorin Kuye, moved the House resolution.

Gbefwi led the discussion during a session chaired by Speaker Abbas Tajudeen. He claimed that cement producers had raised the product’s price by roughly 50%, which had caused sharp increases in the cost of building supplies, building permits, and, ultimately, rents nationwide.

He finds it ironic that the price of cement has been rising nearly every week, despite the fact that the raw materials needed to make cement—particularly lime, silica, alumina, iron oxide, and gypsum—are all locally sourced and unaffected by fluctuations in exchange rates.

The Nigerian House of Representatives has been discussing the increasing price of cement, a key commodity in the country’s economy.

The House has called for the manufacturers to explain their actions and the reasons behind the price hikes. Gbefwi, a member representing Kanke/Pankshin/Kanam Federal Constituency, Plateau State, argued that cement manufacturers are capitalizing on exchange volatility to increase the product’s cost, which has not changed significantly since last year.

Yusuf Gagdi, a member representing Kanke/Pankshin/Kanam Federal Constituency, Plateau State, expressed concern over the ongoing price hikes and called for manufacturers to inform the House.

Deputy Minority Whip George Ozodinobi called for mass importation of cement into the country to force down the price.

He recalled that when cement importation was the norm, the price was stable and affordable. However, Sada Soli (APC, Katsina) and Babajimi Benson (APC, Lagos) called for caution and urged lawmakers to remember that Nigeria has become a net exporter of cement to other African countries. They urged lawmakers to support manufacturers to maintain their market lead.

The House summoned manufacturers to appear before it in the next sectoral debate, as it mandated committees on Solid Minerals Development, Commerce, Industry, and Special Duties to investigate the arbitrary increase in cement prices by manufacturers and report back within four weeks for further legislative action.

The Federal Government has stated that the rising cost of production is responsible for the recent cement price hike, not its concrete road policy.

The Federal Government of Nigeria (FG) has approved an additional N757bn for the dualisation of the 489km Obajana-Benin Road, N2.23bn for the Isheri-Ogun Road, and N114bn for Outer Marina shoreline protection.

This follows warnings from the Cement Producers Association of Nigeria that the FG’s plan to introduce concrete roads would raise the price of cement from N5,600 to N9,000 per bag. Minister of Works Dave Umahi cited documents showing that Dangote Cement Plc, BUA Cement Plc, and Lafarge Africa Plc spent N598.14bn on power during the full year ended December 31, 2023.

Umahi explained that the total cost of their gas rose by over 42 per cent in 2023, which could lead to an increase in cement prices. However, the President has discussed incentives with these companies to reduce the cost of cement.

The FG has also approved an additional N757bn for the Obajana in Lokoja to Benin Road, a total of 244km and 489km dualized.

The project was awarded to four contractors in 2012 for light rehabilitation at a total cost of N122bn.

In 2018, the past administration reviewed the project and dualized it, resulting in a total of 489km. The minister said the review was done to determine the feasibility of the dualisation and to assess the soil texture.

The Council of Nigeria has approved N2.23bn for the rehabilitation of the road from Isheri North to Ogun state, which was previously completed with sheet piles over 50 years ago.

The approval was obtained from the Federal Roads Maintenance Agency for the construction of the Isheri North, Lagos route, which will connect Ogun state.

This is an alternative route to the Lagos-Shagamu Road, which will be tolled when completed. The Council’s approval for the N114bn Outer Marina shoreline protection was based on a tour with Julius Berger, CCECC, CBC, and BuildWell.

The council found merit in BuildWell due to its cost and the latest technology in doing shore protection using interlocking concrete, which won’t rust. The shoreline protection project was necessary due to its proximity to the recently inaugurated Red Line and other existing structures in the area.

The ministry also sought to leverage low-water levels of the dry season to drive piles down the shore. The approval of these projects marks a significant step towards improving road infrastructure in Nigeria.