Lagos – Dangote Cement has urged the Federal Government to invest more on infrastructure to enable it to absorb the anticipated increase in cement production.
Mr Joseph Makoju, the Special Assistant to Alhaji Aliko Dangote on cement, made the call in an interview in Lagos.
He said with the commissioning of the 6 million metric [...]
Vanguard
Read the complete story below:
Dangote Cement has urged the Federal Government to invest more on infrastructure to enable it to absorb the anticipated increase in cement production.
Mr Joseph Makoju, the Special Assistant to Alhaji Aliko Dangote on cement, made the call in an interview in Lagos.
He said with the commissioning of the 6 million metric tonnes cement plant, the country would have enough cement to meet local demand.
According to him, there may even be surplus of cement in the country before Dec. 31, 2012.
"With all these new capacity, there could be a glut out of the excess production. Government has a big part to play because they are the biggest consumer of cement especially in public works and construction.
"So government needs to really invest more in infrastructure development especially civil infrastructure like roads and bridges.''
Makoju said that the new production capacity would eventually bring down the price of cement in the long run.
According to him, the forces of demand and supply will reduce the price of cement though it will not be immediate as other factors could make the price to jump.
He said however that when there were excess supply the market forces would bring down the price.
"I agree market price needs to come down. Factory cost at the moment is about N1,500 maximum per bag. With this increasing production, I am sure Nigerians will be expecting to begin to see the price of cement come down.
"I have no doubt that that period is not far away; it may not be immediately now because there are other distortions. We may even be moving into a period of glut – what is called market forces. When you have a product you want people to buy and they are not coming one of the things you resort to is to give price concessions.
"That period is not far off and when it comes I am very confidence it will start impacting on market prices.''
Makoju said that stakeholders in the cement industry were promoting to all tiers of government the idea of specifying cement in road construction in the country.
According to him, using cement in road construction has been successful in many countries as it has solved their road problems.
"Also, we are now promoting an idea that can lead to an increase in the consumption of cement dramatically. And the idea we are promoting is to specify cement in road construction in Nigeria.
"This has been done successfully in many other counties and it has been a solution to the road problems in those countries because cement roads are for life.
"You know if you mix cement and pour water on it, it starts hardening. It will continue to be getting stronger and stronger with life. So you can imagine a road which actually as it is getting older it is getting stronger.
"The initial cost may be a bit high than asphalt but in the long run it is cheaper because you will not spend money maintaining it.''
Makoju said that contracts had already been awarded to ensure the expansion of the Ibese cement plant and the one at Obajana in Kogi State.
NAN
Lets hope so.... Obviously, Dangote is putting in more effort to expand its production lines which may leads to surplus cement. But what impact will it make on the price... The more we have, the higher we pay; has been the rule for the country called Nigeria!