President of Real Estate Developer's Association of Nigeria ( REDAN), Dr. Aliyu Oroji Wamakko weekend said the increase in prices of cement recently are further threatening infrastructural development and worsening the housing deficit in the country.
Worried by the increment of cement to almost 15,000 Naira per 50kg bag, Dr. Wammako said with increased budget allocations to critical sectors and ambitious infrastructure initiatives (N1.32 trillion to infrastructure, which represents 5.0 per cent of the total Federal Government’s 2024 budget), the construction industry is likely to experience a resurgence.
"Can you imagine, despite a slash in prices from BUA Cement Plc in October 2023, cement price still went up.
"On Sunday, October 1, 2023, the management of BUA Cement announced a slash of the ex-factory price of a bag of cement by 36 per cent to N3,500 from N5,500, promising to review the price upon completion of the new plants, expected to increase its production volumes to 17 million metric tons per annum.
Meanwhile, the Minister of Works, Engr. Nweze David Umahi on Saturday said the Federal Government is also ‘worried by the escalating cost of cement despite huge patronage by road and housing contractors to cement manufacturers.’
He therefore summoned cement manufacturers in the country toward ensuring unbiased cost control of the very important building material.
A statement on Saturday, signed by his Special Adviser on Media and Publicity, Barr. Vitalis Uchenna Orji, said the management of Dangote Cement, BUA Cement and Lafarge are among manufacturers summoned by the Minister.
The meeting is scheduled for 1.00 PM on Monday February 19, 2024, at the Federal Ministry of Works, Mabushi, Abuja. The meeting chiefly aims to address the escalating cost of cement.
Orji quoted the Minister as saying: “It is common knowledge that the manufacturers have their challenges, which we shall look into, but from our findings, the disparity between ex-factory price and the market price, is wide.”
“We therefore need to look into the situation and other issues with a view to finding a common front,” the Minister added.
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According to Wammako, "BUA Group’s chairman, Abdul-Samad Rabiu, had told President Bola Tinubu that his company was increasing its production capacity by inaugurating two new cement plants at the end of 2023 or early 2024 to enable it to flood the nation’s markets with the product.
“Following BUA Cement’s ex-factory price slash to N3,500 in October 2023, so, we are begging the Federal Government through the Minister of Housing and Urban Development, Arch. Dangiwa Musa to urgently call a stakeholders meeting as he has promised to do within two weeks, else construction in our various sites may be put on hold because of the raising increases in the cement price."
According to the REDAN President, "The increase in prices of building materials is compounding the woes of the housing sector. We want the Federal Government to initiate policies that could ameliorate challenges, especially those fostered by exchange rate to boost supply and accessibility to affordable housing.
"And again, in active construction sites in Lagos, Ogun, Port Harcourt, Kano, Abuja, Anambra, and Oyo states, the high price of essential materials is impacting project schedules, thereby slowing down construction activities. Many are abandoning sites, waiting for better days. Developer, who had expended N50 million to construct a building last November, would end up spending about N100 million for the same type of project due to inflation."
"We want to appreciate the Minister for Housing and Urban Development, Arch. Musa Dangiwa who has already decried the astronomical rise in the price of cement and other building materials across the country, we urge him to quickly find a lasting solution to the situation."
Last week, a 50 kilograms bag of cement in the Federal Capital Territory has surged to between N10,000 and N15,000.
A market survey conducted on Friday in Gwarimpa, Area 10, Kubwa, Lugbe and Dawaki showed that a 50kg bag of Dangote cement is N10,000 and BUA cement stood at N15,000.
A retailer in Gwarimpa, Yinka Adebayo, said that the price of Dangote cement is N10,000 while that of BUA is N15,000.
He said he sold a bag of cement for N6,000 in January 2024.
"We sell Dangote cement at N10,000 per bag, and BUA is N15,000. Unfortunately, it will surprise you that I sold the same bag of cement, N5,500 to N6000, last month," he said.
