The perennial crisis in the cement sub-sector of the economy which ranges from scarcity to cut-throat prices may soon become a thing of the past if the words of the Cement Manufacturers Association of Nigeria, (CEMAN), Engr Joseph Makoju are to be relied upon. Makoju premised his optimism that the crisis in the industry will be over before the end of this year on the anticipated local cement production hitting over 20 million metric tons per annum.
Obajana cement plant in Kogi State
The CEMAN President also told journalists in Abuja last week that Nigeria will soon commence exportation of cement to ECOWAS countries from the surplus out of the national cement requirement which stood at 14.5 million metric tons last year.
Makoju who was at a time, the Managing Director of WAPCO Elephant Cement, said the cement industry is currently undergoing transformation with the coming of Aliko Dangote into cement manufacturing. According to him, with surplus capacity being anticipated, importation of cement into the country will be phased out this year.
Already, he said, Dangote cement, Obajana, Kogi State is producing five million metric tons per annum from two production lines with production capacity increasing to 10 million metric tons by next year when the third line of production currently under construction is completed. Dangote cement, Gboko, Benue State has production capacity of 2.5 million metric tons and this capacity is expected to hit 3 million metric tons per before the end of the year, while Lafarge WAPCO cement Ewekoro plant produces at 2.5 million metric tons capacity which put the current production of the two cement manufacturers at 15.5 million metric tons.
He noted that with the anticipated six million metric tons per annum production capacity of Dangote cement plant at Ibeshe, Ogun State expected to commence operation this year, Unicem, Port Harcourt and other cement plants across the country, importation of cement will be a bye gone in Nigeria forever.
Speaking in favour of Dangote who has been variously accused of trying to create a monoploy in the industry, Makoju said: “Nigeria used to be the biggest importer of cement, but that will be a thing of the past with the volume of cement being produced by cement manufacturers in the country. About 15 cement importers were given licenses by the federal government with the mandate to start cement manufacturing in the country. Dangote did not get special concession to do cement business. Apart from Lafarge and Unicem, others did not build plants. But this people will accuse Dangote of monopoly in cement business. These are importers who are not happy that Dangote cement plants are doing well.
He gave reasons for the scarcity of the product and its escalating cost, “On the artificial scarcity of the product and price hike, there are various factors responsible for this. There is distribution chain problem which does not allow the product to get to their destinations on time. Anticipation of importers is another factor responsible for the artificial scarcity. Again, activities of middlemen is one other reason the prices of the product go up. There is also the problem of transportation. It should equally be noted that dry season is peak period for demand for cement, which is also responsible for the artificial scarcity.
“However, this artificial scarcity is not peculiar with cement alone but with all major bulky goods like diesel and food stuffs. But to address these problems, Dangote is investing heavily on trucks. He has 3,000 trucks on cement alone. We try and transport cement to distributors wherever they are. We are opening depots all over across the country to assist distributors without inflating the depot prices.
“We have fuel problem at our Gboko plant, but we are on top of the problem. We also have a system of distribution known as self-collection by distributors to fasten product collection.
It was 70 per cent importation before the backward integration policy of the government. People used to wait for as long as six months before collecting their consignments. But this is not the case today”, the CEMAN boss who is Dangote special adviser on cement, explained.
The Managing Director of the 1.2 billion dollars Obajana plant, Mr.Jagat Rathee said during the facility of the expansive cement plant last week that the daily despatch of cement at the plant is 16,000 tons. Mr. Rathee who stated that five million tons per annum is the current production capacity from two production lines and it will hit 7.5 before the end of this year, said the plant’s production capacity will be 10 million tons in two and half years time.
The managing director who was amazed that there is cement scarcity in the country, said his company is selling between N1,300 to N1,400 per 50 kg bag. He however assured that the country will beself sufficient in cement by next year going by the three million tons Gboko plant production capacity coupled with anticipated production capacities of Ibeshe plant and other cement plants in Nigeria.
Also speaking during the facility tour, the Managing Director of Dangote cement, Gboko, Mr. Shree Junnukar said the current production capacity of the plant is three million tons per annum, pointing out that the company hopes to increase the capacity to four million tons per annum by next year by adding cement grinding to the materials used.
Mr. Junnakar who noted that the plant has six loading bases, stated that they currently load 10,000 tons daily to South East, Middle Belt and South-South. He is optimistic that Nigeria will be self sufficient in cement by next year with the volume of cement being produced by various cement plants across the country. He said his cement sells for between N1,300 and N1,400 per 50kg bag, arguing that there is no basis for selling a bag of cement for N2,000 as being experienced in some parts of the country now.
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