Business
Retailers Explain Price Drop In Cement Cost
The cement market, in the last couple of weeks, has seen a significant turnaround with prices tumbling from between N10,000 and N15,000 per 50kg bag to between N7,000 and N8,000.
The sudden rise in the prices of cement and other major building materials in February this year upsets the construction industry, especially in real estate, where many developers were forced to abandon building sites.
A recent market survey conducted by The Tide’s source in different locations across the country confirmed a price drop, ranging between N7,000 and N7,500 per bag, though BUA cement is selling for N7,500 to N7,800 per 50kg bag, depending on location.
Both entrepreneurs and major distributors who were interviewed, explained that the price drop is due to low demand and government’s intervention.
At the peak of the price hike, the Federal Government called a meeting with major producers where it was agreed that a bag of cement should be between for N7,000 to N8,000, depending on location.
But the producers did not comply with this agreement immediately, followin which “Nigerians stopped demanding for cement; many project sites were abandoned as developers sat back and waited for the prices to come down.
“So, what has happened is an inter-play of demand and supply with price responding, which is Economics at work”, Collins Okpala, a cement dealer, told the source in Abuja.
In the Nyanya area of the Federal Capital Territory, a 50-kg bag of Dangote cement now sells for between N7,000 and N7,500, while BUA cement sells for between N8,500 and N9,500, down from between N11,000 and N12,000 respectively.
In Lagos, the product has seen significant price drop too. In Ojo area of the state, Sebastin Ovie, a dealer, told our reporter that what has happened is a crash from the January price, attributing the crash to low demand and stronger naira.
“The current price of the product is between N7,000 and N7,500 per 50kg bag, depending on the brand. This is a significant drop from the average of N12,000 which most dealers were selling in February and March”, he said.
A dealer in Agege area of the state who identified himself as Taofik Olateju, told the source that sales are picking up due to the drop in price.
He recalled that Nigerians at a point stopped buying due to the high price of the product at N15,000 per bag.
“I am sure most dealers ran at a loss then because we had mainly old stocks which we wanted to offload quickly”, he said, confirming that the product sells for between N7,500 and N8,000, depending on the brand and the demand for the brand.
Continuing, Olateju noted that “because the naira is now doing well against the dollar, it will be unreasonable for manufacturers to continue to sell the product at the old prices. I also believe that the federal government’s intervention and the threat to license more importers may have worked, leading to the reduction in price”.
In Enugu, the source reports that the product sells for between N7,200 and N7,500 depending on the brand and location.
“This is a city where the price of a 50kg bag went for as high as N12,000 and N13,000 in some cases in February and March”, Samuel Chikwendu said.
He added that the prices of other building materials, especially iron rods, have also dropped considerably which is why, he said, activities are picking up again at construction sites.
The story is slightly different in Owerri, the capital of Imo State, where Innocent Okonkwo told the source that low demand was also driving the price drop, adding that a 50kg bag was selling for N9,000 on the average in the state.
Sundry market observers are optimistic of further price reductions, but they remain cautious as manufacturers, wholesalers, and retailers continue to play critical roles in setting prices for end-users.
They lamented, however, that despite Nigeria’s status as one of the largest producers of cement in Africa, the price of the product continues to rise, particularly in the face of high inflation impacting the building materials market generally.
Okpala in Abuja highlighted the variations arising from direct sourcing from manufacturers versus procurement through dealers, with traders holding old stocks selling products at prices ranging from N8,500, N8,300 to N8,000 per bag.
Lucy Nwachukwu, another dealer in Abuja, said the significance of procurement volume in determining cement costs, noting that stability in prices has been observed over the past month, with the product retailing for between N7,000 and N7,800 depending on the brand.
In Port Harcourt also, a customer, Daniel Etteobong Effiong, said the price goes between N7500 to N8500, depending on the brand and the location one is buying from.
For officers and men of the Western Marine Command of the Nigeria Customs Service (NCS), the battle is not over until smuggling is over.
In the wake of Wednesday May, 8, 2024, the ever vigilant officers, acting on a tip-off, intercepted 177 sacks and 61 kegs of 25 litres containing petroleum products, valued at about N8.750,000million.
The items were intercepted along Isalu Creek, Badagry Waterway en-route Benin Republic.
While briefing newsmen, the Command’s Customs Area Controller, Comptroller Paul Bamisaiye, said: “This seizure is most economically significant to the Command at this period of scarcity of Petroleum Products, especially Premium Motor Spirit (PMS) in our cities, and shows the anticipatory posture in our response to economic saboteurs.
“At about 2:330hrs on Wednesday 8th May 2024, while on joint patrol by teams in the Command, credible intelligence was received of the movement of 2 boats laden with what was suspected to be petroleum products concealed in sacks. Upon receipt of the information, the team moved into Isalu creeks, Badagry waterway.
“On sighting the approach of the Officers, the smugglers took to their heels through the shore of the Creek. The loaded boats were then towed to the station at Badagry where preliminary examination was conducted and transferred to Western Marine Command Headquarters, Ibafon, Apapa, Lagos.
“Careful examination at the Command Headquarters revealed that the arrest was found to contain One Hundred and Seventy Seven (177) Sacks and Sixty One (61) Kegs of 25 Litres Premium Motor Spirit (PMS) containing Twelve Thousand Five Hundred (12,500) Liters with a total Duty Paid Value standing at Eight Million Seven Hundred and Fifty Thousand Naira (N8,750,000) only”.
Bamisaiye noted that the action of the smugglers is a contravention of Section 245 & 254 of the Nigeria Customs Service Act 2023 which the service, through Western Marine Command, is responsible for enforcing.
“The Command, under the leadership of Compt. PK Bamisaiye, is poised more than ever to rid the waterways of all acts of smuggling and economy sabotage for the benefit of the growth of economy of Nigeria”, he said
Bamisaiye said so far, no suspect was arrested in the Command’s anti-smuggling operations.
Nkpemenyie Mcdominic, Lagos
Petroleum products being sought by motorists have disappeared from virtually all filling stations within Lagos and its environs, but are now booming in business in retail outlets.
Investigations by our correspondent revealed that while the product could not be got at some of the petrol service stations, activities are in top gear in the local retail outlets where the price has gone beyond the reach of users.
It was also gathered that in some filling stations supplied with the products, preference are often given to retail outlet operators by petrol attendants against the consuming public.
A source, directly involved in the business, said some petrol dealers are cashing on the irregular supply to divert the products to retail outlets where they could easily make their gains.
It was also gathered that some sales representatives in the service of major oil marketing firms indulged in the diversion exercise because of their personal interest.
At the retail outlets a liter goes for N950,00 against the normal N760,to N800 at some stations.
Nkpemenyie Mcdominic, Lagos
The Nigeria Customs Service Board (NCSB) has confirmed the appointment of five Deputy Comptroller-Generals (DCGs) and eight Assistant Comptrollers-General (ACGs) of Customs during its 59th regular meeting.
The meeting, chaired by the Honorable Minister of Finance and Coordinating Minister for the Economy, Mr. Wale Edun, was held at the Nigeria Customs Service Headquarters in Abuja last Tuesday.
National Public Relations Officer of the Service, Chief Superintendent of Customs, Abdullahi Maiwada, who disclosed this in a statement yesterday, gave details of the confirmed appointments as: O.O. Peters (DCG /Commander, Training and Doctrine Command (rtd); B.M. Jibo (DCG Enforcement Inspection & Investigation); and B.U. Nwanfor (DCG Excise, Free Trade Zone & Industrial Incentives).
Others are: S.A. Bomia (DCG, Commander Training and Doctrine Command); and C.K. Niagwan (DCG, Tariff & Trade).
The Assistant Comptrollers General (ACGs) are: B. Imam (ACG Board); A.A.S. Oloyede (ACG, Trade & Tariff); S.K. Dangaldima (ACG/Zonal Coordinator, Zone ‘B’); A. Abdul Azeez (ACG/Zonal Coordinator, Zone ‘D’); S.A. Yusuf (ACG, Human Resource Development); N.P. Umoh (ACG, Training and Doctrine Command); C.O. Obih (ACG/Zonal Coordinator, Zone ‘C’); and S. Chiroma (ACG, Strategic Research and Policy).
The new appointments, according to the statement, were made to fill the vacancies created by some senior officers who recently retired from the Service, noting that the principles of federal character, seniority and merit guided the appointments approved by the board.
“These appointments are a testament to the officers’ exemplary services and dedication to the Nigeria Customs Service. The NCSB remains committed to providing strategic leadership to ensure effective and efficient service delivery for optimum performance”, he said.
While thanking the retired members of the management for their meritorious services, the Comptroller General of Customs, Bashir Adewale Adeniyi, congratulated the newly confirmed officers and charged them to redouble their efforts to ensure the service attains greater heights in its mandates of revenue generation, suppression of smuggling, and trade facilitation amongst others.
Nkpemenyie Mcdominic, Lagos
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