Cement Price From Our Factories Is Between N2,450 And N2,510 Per Bag — Dangote

…Says VAT Inclusive
…Says Nigeria Price Is In Line With Or Lower Than Prices Across The
West African Coast

Management of Dangote Cement Plc has clarified that the price of
a bag of cement from its factories and plants across Nigeria (as of
12th April 2021) is N2,450 in Obajana and Gboko, and N2,510 in
Ibese inclusive of VAT. The clarification was made in view of
recent insinuations that the company sells cement in Nigeria at
significantly higher prices relative to other countries,
particularly Ghana and Zambia.

Dangote’s Group Executive Director, Strategy, Portfolio
Development and Capital Projects, Devakumar Edwin revealed that,
while a bag of Cement sells for an equivalent of $5.1, including
VAT in Nigeria, it sells for $7.2 in Ghana and $5.95 in Zambia
ex-factory, inclusive of all taxes. He said that though the company
has direct control over its ex-factory prices, it cannot control
the ultimate price of cement when it gets to the market. He advised
that it is important to distinguish Dangote’s ex-factory prices
from prices at which retailers sell cement in the market.

He, therefore, frowned at intentional misinformation or
demarketing, allegedly sponsored by some individuals, that Dangote
sells its cement at higher prices in Nigeria relative to other
African countries at the expense of Nigerians. He described the
allegation as false, misleading, and unfounded, while giving the
media persons present at the press conference copies of invoices
from Nigeria and some other African countries (Cameroun, Ghana,
Sierra Leone, Zambia), and urging them to conduct independent
investigations on the price of cement across the West African
coast.

Edwin further explained that while Dangote cement has 60% share
of the market, other companies have the remaining 40%. DCP has no
control over neither the prices charged by other cement
manufacturers nor the prices charged by retailers in the
markets.

He further explained that “Demand for cement has risen globally
as a fallout of the COVID crisis. Nigeria is no exception as a
combination of monetary policy changes and low returns from the
capital market has resulted in a significant increase in
construction activity. To ensure that we meet local demand, we had
to suspend exports from our recently commissioned export terminals,
thereby foregoing dollar earnings. We also had to reactivate our
4.5m ton capacity Gboko Plant which was closed 4 years ago and run
it at a higher cost all in a bid to guarantee that we meet demand
and keep the price of Cement within control in the country.”

He said: “Over the past 15 months, our production costs have
gone up significantly. About 50% of our costs are linked to USD so
the cost of critical components like: gas, gypsum, bags, and spare
parts; has increased significantly due to devaluation of the Naira
and VAT increase. Despite this, DCP has not increased ex-factory
prices since December 2019 till date while prices of most other
building materials have gone up significantly. We have only
adjusted our transport rates to account for higher costs of diesel,
spare parts, tyres, and truck replacement. Still, we charge our
customers only N300 – 350 per bag for deliveries within a 1,200km
radius. We have been responsible enough not to even attempt to cash
in on the recent rise in demand to increase prices so far” he
said.

…Says VAT Inclusive
…Says Nigeria Price Is In Line With Or Lower Than Prices Across The
West African Coast

Management of Dangote Cement Plc has clarified that the price of
a bag of cement from its factories and plants across Nigeria (as of
12th April 2021) is N2,450 in Obajana and Gboko, and N2,510 in
Ibese inclusive of VAT. The clarification was made in view of
recent insinuations that the company sells cement in Nigeria at
significantly higher prices relative to other countries,
particularly Ghana and Zambia.

Dangote’s Group Executive Director, Strategy, Portfolio
Development and Capital Projects, Devakumar Edwin revealed that,
while a bag of Cement sells for an equivalent of $5.1, including
VAT in Nigeria, it sells for $7.2 in Ghana and $5.95 in Zambia
ex-factory, inclusive of all taxes. He said that though the company
has direct control over its ex-factory prices, it cannot control
the ultimate price of cement when it gets to the market. He advised
that it is important to distinguish Dangote’s ex-factory prices
from prices at which retailers sell cement in the market.

He, therefore, frowned at intentional misinformation or
demarketing, allegedly sponsored by some individuals, that Dangote
sells its cement at higher prices in Nigeria relative to other
African countries at the expense of Nigerians. He described the
allegation as false, misleading, and unfounded, while giving the
media persons present at the press conference copies of invoices
from Nigeria and some other African countries (Cameroun, Ghana,
Sierra Leone, Zambia), and urging them to conduct independent
investigations on the price of cement across the West African
coast.

Edwin further explained that while Dangote cement has 60% share
of the market, other companies have the remaining 40%. DCP has no
control over neither the prices charged by other cement
manufacturers nor the prices charged by retailers in the
markets.

He further explained that “Demand for cement has risen globally
as a fallout of the COVID crisis. Nigeria is no exception as a
combination of monetary policy changes and low returns from the
capital market has resulted in a significant increase in
construction activity. To ensure that we meet local demand, we had
to suspend exports from our recently commissioned export terminals,
thereby foregoing dollar earnings. We also had to reactivate our
4.5m ton capacity Gboko Plant which was closed 4 years ago and run
it at a higher cost all in a bid to guarantee that we meet demand
and keep the price of Cement within control in the country.”

He said: “Over the past 15 months, our production costs have
gone up significantly. About 50% of our costs are linked to USD so
the cost of critical components like: gas, gypsum, bags, and spare
parts; has increased significantly due to devaluation of the Naira
and VAT increase. Despite this, DCP has not increased ex-factory
prices since December 2019 till date while prices of most other
building materials have gone up significantly. We have only
adjusted our transport rates to account for higher costs of diesel,
spare parts, tyres, and truck replacement. Still, we charge our
customers only N300 – 350 per bag for deliveries within a 1,200km
radius. We have been responsible enough not to even attempt to cash
in on the recent rise in demand to increase prices so far” he
said.