The Federal Government of Nigeria has called on cement manufacturers to reduce prices to N7,000 per bag, citing improved economic conditions that should justify the price drop.
The Minister of Works, Sen. Engr. Nweze David Umahi, issued this demand during a meeting at the ministry’s headquarters in Abuja on February 26, 2025, as reported in an official statement on the ministry’s website. Umahi insisted that with the naira stabilizing at N1,400 per dollar and petrol prices falling, cement manufacturers have no reason to keep prices at N9,500 per bag, an increase that was implemented when the naira was nearing N2,000 per dollar.
Umahi criticized manufacturers for failing to adjust cement prices despite the naira’s recent gains, questioning why they were quick to raise prices during the currency’s depreciation but have been slow to reverse them as it rebounds.
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“Today, a dollar is about N1,400. And let me use the opportunity to express dissatisfaction with the cost of cement.
“We are using this medium to tell the cement manufacturers that at the time the dollar was almost N2,000, they increased cement from N7,500. Why should today, when the President has brought the dollar to stability to about N1,400 and is still going down, cement be selling for N9,500? We are requesting cement manufacturers to bring down the cost of cement to N7,000.”
The Works Minister emphasized that affordable cement is crucial for national infrastructure development, particularly the government’s transition to Continuously Reinforced Concrete Pavements (CRCP) for road construction, which he described as more durable and cost-effective compared to asphalt.
He also revealed that the high cost of cement is forcing many contractors to reconsider the government’s plan to switch to concrete roads, with some preferring asphalt due to its relatively lower upfront costs.
If this trend continues, it could derail the federal government’s infrastructure strategy, which prioritizes concrete roads for their durability and long-term cost-effectiveness.
Manufacturers and Consumers Dispute Government’s Claims
However, this assertion has sparked debate and skepticism as both cement producers and consumers argue that the claimed economic improvements are not reflected in real market conditions.
Industry leaders in the cement sector note that the cost of production remains high, even with the naira’s partial recovery. They cite rising energy costs, particularly the price of diesel and gas, which remain significantly elevated.
Additionally, they highlight:
- Persistent high transportation costs due to poor infrastructure.
- Increased raw material costs, many of which are still subject to import price fluctuations.
- High interest rates on loans used to finance cement production.
Manufacturers insist that until these fundamental cost pressures ease, cement prices cannot be reduced significantly.
Consumers’ Perspective
On the consumer side, ordinary Nigerians say that the supposed economic improvements the government is touting have not translated into lower costs of living. While government reports indicate that inflation is slowing down and GDP is growing, these figures are not yet reflected in the prices of essential goods and services.
Umahi’s Ultimatum: Price Must Drop in One Week
The minister issued a one-week ultimatum for cement manufacturers to lower their prices, warning that failure to do so would force him to escalate the matter to President Bola Tinubu for further action.
However, this is not the first time a government official under Tinubu’s administration has criticized cement manufacturers for price hikes.
In February 2024, Musa Dangiwa, the Minister of Housing and Urban Development, condemned the excessive increase in cement prices, accusing manufacturers of using foreign exchange fluctuations as an excuse to inflate costs and worsen Nigeria’s economic crisis.
Dangiwa pointed out that cement prices had surged from N5,500 to over N10,000 per bag, a more than 100% increase in just months. He urged manufacturers to seek innovative solutions instead of passing on every cost to consumers.
He also warned that rising cement prices posed a serious threat to the government’s housing projects, especially for low-income earners and vulnerable Nigerians.
While government agencies continue to publish data suggesting an economic recovery, the stark reality remains that essential commodities, including cement, food, and transportation, have not seen any meaningful price reductions. This contradiction has led many Nigerians to question the accuracy of official economic reports and whether the “improved conditions” cited by the government truly exist.