At a meeting with newsmen in Lagos on Monday, Dangote Cement new Group Chief Sales and Marketing Director, Rabiu Umar claimed that the company had not increased their factory price.
While blaming the middlemen for increasing the price of the commodity, citing difficulties in getting supply, Umar admitted that there is about 40 per cent gap in cement supply which has led to significant increase in the price of cement across the country.
READ ALSO: Uncertainty Over Official Foreign Exchange Rate As CBN Removes N379/$1 From Website
As a measure to restore the price of cement back to its normal position, the Sales and Marketing Director said Dangote is boosting production in order to close the gap between supply and demand.
He disclosed that the company was building more capacity as it recently invested in a new line that had been completed in its Obajana plant. The line was only waiting for power to commence operations.
Umar added that the company has a new plant in Okpella, Edo state, that will start operations very soon. He also noted that for the last couple of years, one of the plants in Gboko, Benue State has not worked but the plant has been re-started, all in a bid to make sure there is enough production.
Umar explained, “In every business, what drives the price is the demand and supply. Now as a business, we have not increased our price up until this point. So, what has happened in price increment in the cement products is the forces of demand and supply.”
Umar gave the declining COVID-19 crisis, the combination of monetary policy changes and reduced capital market returns as the reasons for increased construction activities.
He said, “We got into COVID-19 last year and immediately after the pandemic, there was a surge in demand, and it is not particular to Nigeria alone.”
According to Umar, the company had direct control over its ex-factory prices, it had no control over the ultimate price of cement in the market. He disclosed that the company would be bringing in 2,000 brand new trucks to ease distribution challenges.
He is therefore optimistic that increasing production capacity would make impact in reducing the price of the commodity significantly.
