In a move that will raise the stakes
in the rapidly evolving Nigerian cement market, leading cement manufacturer,
Dangote Cement Plc has announced huge cuts in the price of the essential
product.
A step that will make cement cheaper
than it has ever been since 2005, the new price regime announced by the Group
Managing Director of Dangote Cement, Mr. Devakumar Edwin, said the Company has
pegged the Dangote 32.5 cement grade at N1,000 per 50 kg bag, while the higher
42.5 grade is to sell for N1,150 per bag.
The new prices exclusive of the
Value Added Tax (VAT), represents about 40 per cent discount on the prevailing
market price of the product which is currently sold for N1, 700 irrespective of
the grade, across the country.
Edwin said the move is in line with
the company’s commitment to the nation’s dire need for the development of
infrastructure and to boost the federal and state government’s ongoing effort
to reduce the near 20 million housing deficit in Africa’s largest economy.
“We recognize the need for an
increased rapid response to the huge infrastructure and housing deficit in the
country, and one of the ways of addressing the issue is bringing the price of
building materials down to much more affordable levels especially cement which
within our own control as part of our own contribution to the transformation
agenda of the Goodluck Jonathan administration and the attainment of key
milestones in the Millennium Development Goals (MDGs),” he said.
Since the commencement of the
implementation of the backward integration policy for cement in the country
over 12 years ago, the local production capacity of the product rose from less
than 3 million metric tonnes per annum to about 38 million metric tonnes per
annum.
During the over 12-year period of
the backward integration policy, nearly $20 billion has been directly and
indirectly injected into the Nigerian cement industry with Dangote Cement Plc
accounting for 60 per cent of that spend
The GMD/CEO also noted that Dangote
Cement Plc will continue to ensure alignment of its corporate social
responsibility with its strategic business initiatives and will continue to
evaluate its pricing regime in Nigeria’s best interest.
Meanwhile, the timing of the
initiative has confounded industry watchers, who say that from experience, the
cement market is on the verge of entering the accelerated demand phase as the
raining season is tapering and the dry season which provides the opportunity
for increased construction and building activities is setting in.
Recently, in further compliance with
the ongoing Standards Organisation of Nigeria (SON) directive and regulation on
the various grades of cement and their prescribed uses, Dangote cement launched
its brand of the premium 32.5 cement grades, which has been restricted to
plastering use only.
The largest cement producer in
Nigeria noted that the move was to develop a full bouquet of cement types to
meet the varied needs of consumers for the different grades of cement.
Source: www.thewillnigeria.com
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