Dangote’s Group Executive Director, Strategy, Portfolio Development & Capital Projects, Devakumar Edwin, disclosed that if some bag of cement sells for an equivalent of $5.1, such as VAT in Nigeria, it retails for $7.2 in Ghana and $5.95 in Zambia ex-factory, inclusive of all taxes.
He said though the firm had direct control over its ex-factory prices, it could not control the best cost of cement when it gets to the market.
He advised it is important to distinguish Dangote’s ex-factory costs from prices at which retailers sell cement in the market.
He, consequently, frowned at deliberate misinformation or the de-marketing allegedly sponsored by a few people, that Dangote sells its cement at greater prices in Nigeria relative to other African nations at the expense of Nigerians.
He encouraged them to conduct separate investigations on the price of cement across the West African shore.
Edwin further clarified that while Dangote Cement has 60% share of the market, other firms have the remaining 40%.
“DCP doesn’t have any control over neither the costs charged by other cement manufacturers nor the prices charged by retailers at the markets,” he explained.
He added: “Demand for cement has risen globally as a fallout of this COVID crisis.
“Nigeria is no exception as a combination of monetary policy changes and low yields in the capital market have led to a significant increase in construction activity.
“To ensure we meet local need, we had to suspend exports out of our newly commissioned export terminals, thus foregoing dollar earnings.
“We also had to reactivate our 4.5 million ton power Gboko plant that was closed four years ago and operate it at a greater price all in an attempt to ensure that we meet the need and keep the price of cement within management in the nation.”
He said: “Within the past 15 weeks, our production costs have gone up significantly.
“Despite this, DCP has not increased ex-factory costs since December 2019 till date while prices of other building materials have gone up appreciably.
“We have just adjusted our transport rates into account for higher prices of petrol, spare parts, tyres, and truck replacement. Still, we charge our clients just N300 — 350 per tote for deliveries inside a 1,200km radius. We have been responsible enough to not even attempt to cash in on the current rise in need to boost prices so far.”