Energy costs have driven cement prices to about N12,000 per bag, according to private sector operators who are concerned that the trend is squeezing construction activities nationwide.
These experts attributed the recent spike in cement prices in Nigeria from about N11,000 and N11,500, depending on the area of purchase, to around N12,200 per bag, blaming rising energy and logistics costs.
In separate phone interviews with The PUNCH, these private sector operators blamed rising energy and logistics costs for the recent spike in cement prices, warning that the trend is squeezing construction activities across the country.
The Chairman of the Lagos Chamber of Commerce and Industry Construction and Engineering Group, Soji Adeniji, said higher fuel prices and distribution costs had significantly impacted production and delivery expenses.
He said, “Everybody is laying claim to an increase in the pump price, which has gone up from what used to be N1,000 to about N1,900. That is going to affect the energy consumption of factories.”
Speaking on the impact of the cost of logistics, Adeniji noted that operators always consider what it costs when customers want cement “delivered (to them) at N11,700, which is different from picking it up from the factory at N11,200.”
He explained that by the time you look at the “disparity, you will have known that the cost of logistics has informed the hike in price when it comes to distribution.”
Adeniji added that factory-level pricing also reflected rising production costs, noting that broader global factors, including the Middle East crisis, could be influencing input prices.
He said, “One may not be wrong by concluding that it’s the effect of the conflict that we’re experiencing all over the world.”
Also, the Chief Executive Officer of Space Button Architecture Ltd, Arc Oluseyi Amusan, linked the sudden increase to fuel costs.
He said, “I was equally surprised when it jumped from N11,500 two weeks ago to N12,000. I ordered from the same dealer, and he said he hiked it because of the increase in fuel price.”
Amusan noted that it could be attributed to manufacturers often increasing prices randomly or the Middle East crisis.
He stated, “The increase in fuel price could be linked to the present crisis in the Middle East, but (the driver explained to me that) it could also be a result of the cement manufacturer’s (habit) to often increase prices randomly even before the conflict.”
