Dangote Links High Price of Cement to Market Forces

0
132

 

Dangote Cement Plc has attributed the high price of cement in Nigeria to the market forces of demand and supply.

The Group Chief Commercial Officer, Dangote Industries Limited, Rabiu Umar, who stated this while addressing the media yesterday explained that the crux of the matter is that demand has recently outstripped supply.

He said as a business, Dangote has not increased price up till this point, adding that what has happened is that the forces of demand and supply have been the main driver of what people are talking about, the prices of cement going to extra amounts of money.

According to him, the only way to deal with that is to make sure that you have adequate supply capacity because if you do not produce enough no matter what you do, there will be break in the supply chain and that will always create some opportunity for arbitraging.

He then explained that what the company is doing is to increase the supply of the product in the market, while it is also intervening in the transportation and distribution logistics to starve off possible cost sleeping into the pricing issue.

Umar said , this is why Dangote is injecting 2000 units of new trucks with some of them ordered from local truck manufacturers, the Anambra Motor Manufacturing Company, ANAMCO, in Enugu.

He disclosed that the trucks are being bought to make sure that the distribution is taken care of.

To increase supply of the product , he said the company has also invested in a new line that has been completed in its Obajana plant, adding that the line is waiting for the power plant for it to start to bring out the cement .

“We have a new line now in our plant at Opela in Edo state, that is also going to start operation soon. For the last couple of years, one of our plants in Gboko, former Benue cement, has not worked for almost four years.

‘’We have now started that plant, all in a bid to make sure that there is enough production’’, according to him.