After two months, cement prices go through the roof again  By Simon Utebor; Ozioma Ubabukoh, Enugu; Chukwudi Akasike, Port Harcourt; and Mike Odiegwu, Yenagoa   
Saturday, 13 Aug 2011   

   
Cement bags being loaded at Arepo, Ogun State,  on Thursday. Inset are bags of cement 

The prices of cement, an essential building material, have gone through the roof again, despite the presidential directive in April 2011 that the product should sell for N1,500 per 50kg bag.

The new trend has left tongues wagging about the possibility that the Federal Government and cement manufacturers are toying with the lives and well-being of Nigerians.


Worst hit by the astronomical rise in the prices of the product are building engineers, bricklayers, block manufacturers and end-users.

They feel the manufacturers and middlemen are holding Nigerians to ransom because the government seems to lack the will-power to enforce its own directives.

SATURDAY PUNCH checks at various retail outlets in the Lagos metropolis, especially at Iyana Ipaja, Oshodi, Ikorodu, Egbeda and Yaba showed that the prices of the product have risen to between N2,000 and N2,200 depending on the manufacturer of the product.
An end-user, Mrs. Julian Itua, became aware of the reality of the current price when one side of her fence collapsed during the July 10, 2011 downpour in Lagos.
She lamented that shortly after the fence collapsed, she contracted a mason, who did the costing of the reconstruction of the fence based on N1,700 per bag of cement.



But Itua was shocked when she went to buy the product last week at the shop where she was told a bag was N1,700, only to discover that the price had skyrocketed to N2,200 per bag.



She said, “Apart from the high cost of the product, scarcity is another aspect. Many retail outlets are hoarding the product. I wonder what Nigeria is turning to. The whole thing looks as if we have no functional government in place.



“Just two weeks ago, the price fell to N1,700. Suddenly, as if it was a drama, the price has gone through the roof again. The repairs that should cost me N175,000 is now about N250,000.



“This development is not funny at all. The government must do something to arrest the trend.”



For a mason, Mr. Chukwudi Odahieku, he said since the whole drama about price instability started, his daily income had been drastically affected.



“A large number of clients we work for have not been forthcoming. They usually ask us to wait for them to study the trend. In fact, our jobs have not been regular again and I have been finding it extremely difficult to fend for my family,” Odahieku lamented.



Also, a building engineer, Mr. Ovie Gabriel, wondered why things didn’t usually work in Nigeria.



He said just last week, in some parts of Ikorodu, Lagos, the product sold for N1,650, but added that he was amazed that the same product had galloped to N2,000.



However, Gabriel said his clients, knowing that prices in Nigeria were unstable because of the government’s inability to enforce policies, had resigned to fate and gone ahead with their projects.



“In Nigeria, one cannot be sure of anything. The government’s inability to enforce the price regime of cement is responsible for the current state of affairs.



“However, most of my clients have resigned to fate and continued with their projects, whether the price goes up or not,” he said.



A block manufacturer in Ikorodu, who identified himself simply as Segun, said the jerking up of cement price had affected the unit price of the blocks he produced.



According to him, a six-inch block is now sold for N115, while nine-inch block is N130, against the N100 and N115 respectively that they were sold in June and part of July.



“The price of cement has gone up again. The government is not able to enforce the directive it gave to cement manufacturers and suppliers.



“The only way out of this whole problem is for the government to take a decisive action to address the alarming increase,” Segun said.



He said his association heard from the grapevine that a powerful manufacturer and importer failed to pay his import duty and the relevant authorities prevented him from off-loading his company’s products, adding that the action had affected other importers who depended on him.



But Mr. Salako James, the Executive Secretary, Cement Manufacturers Association of Nigeria, said the increase had nothing to do with the manufacturers.



“It is not the job of the manufacturers alone to sustain prices.



“Manufacturers do not dictate open market prices.



“I can assure you that manufacturers have ex-factory prices, which have not changed. In fact, ex-factory prices have come down instead of even going up,” James said.



He said if the market price of the product had gone up, Nigerians should find out the reason, adding that it was incorrect to attribute such to the manufacturers.



On whether the cost of production triggered the new price regime, James said as an official of CMAN, he could not speak for the cement companies.



In Enugu, the Manufacturers Association of Nigeria has challenged the governments in the South-East region to ensure the revival of all moribund companies in the zone as a requirement for the economic development of the area.



The chairman of MAN in Enugu, Ebonyi and Anambra states, Chief Chike Obidigbo, gave this challenge on Thursday while reacting to the consistent increase in the price of cement in the country.



Obidigbo said that had cement-producing companies like Nigercem in Enugu not collapsed, there wouldn’t have been the importation or monopoly of cement production by companies and individuals who had continued to increase the prices.



The MAN chairman said that shylock landlords in the zone, Anambra and Enugu states in particular, had capitalised on the regular increases in the price of cement to jerk up their rent at will.



He said that if the problems of Nigercem and other indigenous companies in the South-East were addressed, it would not only encourage the Igbo in their manufacturing, building and entrepreneurship abilities, it would also create employment opportunities and enhance the internally-generated revenue profiles of the states in the zone.



Meanwhile, Akubuilo told our correpondent that the state government was ready to create an enabling environment for builders and manufacturers in the state.



A market survey of cement shops in Enugu showed that the product sold in places like Obete, Kenyatta and New Market at N1, 600, while in places like Abakpa and environs it is sold at N1, 550.



However, in Port Harcourt, the Rivers State capital, the price of a bag of cement seems to have been pegged at N1,500.



SATURDAY PUNCH observed that both Eagle Cement and Ibeto Cement brands were sold at the same N1,500 per bag.



The current price of cement in the Rivers State capital is a sharp difference from what it used to be in May 2011 as this essential building material sold for N2,000 per bag.



A customer, Mrs. Fanny George, who recently purchased 50 bags of cement at the sum of N1,500 each on Rumuobikani Road, described the reduction in price as a welcome development.



She explained that with the situation on the ground, the average the Nigerian living in that part of the country could begin to think of having houses of their own.



At Rumuola, the price of a bag of Dangote cement ranges from 1,500 to N1,560 depending on the quantity that is to be purchased by customers.



A major dealer in Dangote cement in Port Harcourt, Mr. Sam Asuquo, told SATURDAY PUNCH that the unit price of the product at the point of bagging was N810, adding that the end-user might get a bag at N1,450 or N1,500.



Asuquo, who is the managing director of Paz Global Services, stated that the retail price of a bag of Dangote cement could be determined by the cost of the product’s transport.



In Bayelsa, a bag of cement is sold between N1,650 and N1,700. This is against the directive by the Federal Government that the product should be sold for N1,500.



Our correspondent, who visited some of the cement stores in Yenagoa on Thursday, discovered that all the brands of the product such as Dangote and Bua, sold above N1,500.



One of the dealers, who identified himself simply as Samuel, said the government’s proposed price was not feasible.



He said that most dealers were buying the product at N1,500 from the major agents.



He, however, said that the product was initially sold at N2,200 and urged the government to issue more licences for the importation of the product.[/quoe]