No More N5,000/Bag: Nigerians Lament as Cement Price Increases by 30% in 2024
- The cost of cement has jumped as much as 30% to sell for N6,200 and 6,500 in just a few days
- This has led to an increase in six-inch and nine-inch blocks from N450 and N550 to N500 and N600, respectively
- The development is expected to lead to an increase in the cost of building and a consequent rise in the price of rent in the country
Legit.ng journalist Zainab Iwayemi has over three years of experience covering the Economy, Technology, and Capital Market.
The price of cement has skyrocketed in the last few days, hitting a new high amid the harsh economic realities in Nigeria.
An investigation by the Guardian showed cement brands have experienced price hikes exceeding N1,000 per bag from entities associated with the Cement Manufacturers Association of Nigeria (CMAN).
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As a result, retail prices in Lagos and the Southwest region have gone from N5,000 to N6,200 or more. Also, prices in Abuja and the Southeast have skyrocketed to N6,500 or more.
The development has already impacted sandcrete block prices. Block makers are now charging N500 instead of N450 for a six-inch block, and for a nine-inch block, the price is now N600 instead of N550.
While the cost of producing concrete in situ is expected to climb dramatically, the price of ready-mix concrete will follow suit.
Consequently, rent increases and the cost of maintenance are expected to be affected by the rise, making the economic situation worse as new home costs climb.
Past president of the Nigerian Institute of Building, Kunle Awobodu, told The Guardian that the frequent increase in building materials is bad for the economy.
According to him, this will create a crisis in the construction sector and bad blood between clients and contractors, as developers will make claims for fluctuations.
He said:
“Invariably, it will lead to upward reviews of contract sums. New and ongoing projects will be delayed until there is an agreement on the contract variations. It can also expedite construction activities because of the anticipation of further increase.”
Earlier warnings of price hikes
President Bola Tinubu had already been urged to step in and stop the projected rise in cement prices by the Building Collapse Prevention Guild (BCPG).
In a recent statement released by Sulaimon Yusuf, its national President, and Adenike Ayanda, the general secretary, the group claimed that further increase in cement prices would directly jeopardise the federal government's "Renewed Hope" housing program.
The statement reads:
“Completion of ongoing building projects might be jeopardised by the impending hike in the price of cement. Buildings abandoned during the process of construction aggravate the risk of building collapse. With the dwindling purchasing power, new buildings might lack patronage and occupants due to high rental value.
“Frequency in the increase of its price has impacted negatively in the nation’s housing sector. Experience has shown that high prices of cement tend to encourage a reduction in building production quality. The consequence of this is the emergence of weak buildings that intensifies the occurrence of building collapse.”
Marketers sell BUA Cement above N5,000
Legit.ng earlier reported that the ex-factory price of BUA cement was recently reduced by 30% to N3,500, but the cement has continued to be sold for N5,000 and above in several regions of the country.
In an earlier report, the company said the changes would be reflected starting Monday, October 2, 2023.
But findings by Legit.ng showed the contrary in some regions across the country.
Legit.ng also reported the reactions of builders and Nigerians to the reported plan to increase cement price in 2024.
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Source: Legit.ng
