Written by SpringNewsNG Media Limited, March 13, 2025.

In a bold move to stabilize the cement market, the Federal Government of Nigeria has mandated that cement manufacturers reduce the cost of a 50kg bag to N7,000 or face being reported to President Bola Tinubu. This directive was issued by the Minister of Works, Dave Umahi, who cited the stabilization of the exchange rate and the reduction in petrol prices as key reasons for the price adjustment.

Rationale Behind the Price Fix

Minister Umahi highlighted that the exchange rate has now settled at N1,400 to a dollar, which is a significant drop from the previous N2,000 to a dollar. Despite this, the price of cement has soared to N9,500 per 50kg bag. Umahi questioned why the prices remain high and insisted that manufacturers comply with the new pricing structure within seven days or risk presidential intervention.

Impact on Road Construction

Contractors working on major road projects, including the Enugu-Onitsha dual carriageway, have expressed concerns about reverting to asphalt due to the high cost of cement. Umahi emphasized that the project, funded by MTN, must be completed by May 10, 2025, and that MTN will be held accountable for any delays.

Foreign Investment and New Entrants

The directive comes at a time when foreign cement companies are eyeing the Nigerian market. Chinese firm Huaxin Cement Company is set to acquire an 83% stake in Lafarge Africa from Holcim for $838.8 million, valuing the company’s total worth between $1.06 billion and $1.59 billion. This acquisition aligns with Huaxin’s strategy to expand overseas and leverage its expertise in industrial technology and production chain integration.

Local Expansion Efforts

In addition, Kebbi State has signed an agreement with MSM Cement Limited to establish a factory with a capacity of three million tonnes per annum. Governor Nasir Idris assured that the state government would provide a conducive environment for the factory to operate.

Conclusion

The Federal Government’s ultimatum aims to protect consumers and support infrastructure development. With foreign investors entering the market and local governments fostering industrial growth, the cement industry is poised for significant transformation. Manufacturers are now under pressure to comply with the new pricing directive or face potential consequences from the highest office in the land.