Funsho Arogundade
As Dangote Cement plc explains cut in the price of its grades of cement products, stakeholders weigh in on implications
When Dangote Cement plc announced a fortnight ago the price cut of its cement grades, it was received with mixed-reactions. The company slashed its ex-factory price of cement from N1,700 to N1,000 per bag, representing about 40 per cent discount on the prevailing market price. While the 32.5 cement grade will sell at N1,000, its 42.5 grade will now go for N1,150.
Devakumar Edwin, group managing director, Dangote Cement plc, explained that the new price regime was introduced in the best interest of Nigerians who have all along been looking forward to the slash just as all cement manufacturers continued to increase their production capacities to meet and, perhaps, surpass national consumption need.
Edwin pointed out that reduction in the price of building materials, particularly cement, which is within the company’s control, is one of the strategies of reducing housing deficit in the country.
“It has always been our desire at Dangote Cement plc to reduce the price of our products to enable many more Nigerians to build their own houses. We will continue to appraise our pricing regime in Nigeria’s best interest, from time to time. We are an ethical organisation and we believe in putting our customers first, before profit. We believe in creating value for all our stakeholders in a sustainable manner and we will continue to pursue this philosophy,” he said.
Amidst expression of surprise on the new price revolution, the Dangote Cement plc boss assured that the company will design a monitoring process that will ensure that profiteers do not hijack the new price cut so that it end users of the commodity can benefit directly.
Despite its huge population, Nigeria has a low home-ownership level with an estimation of a little above 10 per cent in the world. The country’s mortgage industry also makes the least contribution to the national gross domestic product, GDP. While the United States is said to boast of 63 per cent, United Kingdom, 64 per cent, Germany, 55 per cent, South Africa, 20 per cent and Ghana with 3 per cent, with Nigeria contributing a paltry 0.12 per cent.
It was this gap that Dangote Cement plc claimed this new price regime is coming to plug.