Cement Cheaper in Kenya, Togo Than Nigeria, FCCPC Probe

The Federal Competition and Consumer Protection Commission (FCCPC) has opened a further investigation into possible manipulation of cement prices in Nigeria following findings from a three-month study of the domestic and international cement markets.

The commission said its preliminary findings suggested that the prevailing prices of cement in Nigeria could not be fully explained by market conditions.

The investigation was conducted by the FCCPC’s Anticompetitive Practices Department following widespread complaints over the rising cost of cement.

According to the commission, the study compared Nigeria’s cement market with those of Kenya, Tanzania, South Africa, Egypt, Morocco, Algeria and Togo.

It examined factors including limestone availability, population, cement production capacity, domestic consumption and retail prices.

The FCCPC said Nigeria had substantial limestone deposits and an installed cement production capacity estimated at between 60 million and 65 million metric tonnes annually, compared with domestic consumption of about 25 million to 30 million metric tonnes.

Despite the reported excess capacity and Nigeria’s position as a net exporter of cement to neighbouring countries, the commission said domestic prices had continued to rise.

The commission said a 50kg bag of cement, which sold for between N9,300 and N9,700 in January, had risen to between N10,500 and N13,000 by mid-year.

By July, prices had reached between N13,000 and N15,000 in some parts of the country.

The FCCPC also found significant price differences between Nigeria and other African markets.

In Kenya, a 50kg bag of cement reportedly sold for about $5.40, equivalent to N7,344, while in Tanzania it sold for about $4.80, equivalent to N6,528.

In Togo, where the commission noted that there were no limestone deposits, a 50kg bag sold for about $6.75, equivalent to N9,180.

The commission said the findings had raised questions about the factors driving cement prices in Nigeria and warranted a deeper investigation into possible anti-competitive practices.

The FCCPC said the latest investigation would seek to establish whether any companies or industry practices were restricting competition or contributing to what it described as potentially unjustified price increases.

It said the preliminary findings were not a final determination of wrongdoing, stressing that the ongoing investigation would establish the facts and determine whether any violations of competition laws had occurred.