Cement Cheaper in Kenya, Tanzania, Togo Despite Nigeria’s Excess Capacity — FCCPC
3 mins read·7 hrs ago
The Federal Competition and Consumer Protection Commission has opened a further investigation into possible manipulation of cement prices in Nigeria following a three-month study of the sector.
The commission said its preliminary findings suggested that the prevailing prices of cement could not be fully explained by market conditions, despite Nigeria’s substantial limestone deposits and installed production capacity.
The investigation was conducted by the FCCPC’s Anticompetitive Practices Department following widespread complaints over the rising cost of cement.
In a statement issued on Tuesday by the commission’s Director of Corporate Affairs, Ondaje Ijagwu, the FCCPC said the study compared Nigeria’s cement market with those of Kenya, Tanzania, South Africa, Egypt, Morocco, Algeria and Togo.
The study examined limestone availability, population, production capacity, consumption and retail prices across the countries.
“Findings from an industry-wide investigation conducted by the Federal Competition and Consumer Protection Commission suggest possible manipulation of prices of cement in the Nigerian market,” the commission said.
The FCCPC said the findings represented the preliminary outcome of a 40-page field report compiled from the three-month cross-border study.
According to the commission, Nigeria has 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.
It noted that despite the reported excess capacity and Nigeria’s status as a net exporter of cement to neighbouring countries, domestic prices had continued to rise.
The commission said market intelligence showed that the price of a 50kg bag of cement increased from between N9,300 and N9,700 in January to between N10,500 and N13,000 by mid-year.
By July, the product was selling for between N13,000 and N15,000 in some parts of the country.
The FCCPC said its findings also showed that cement was being sold at lower prices in some other African markets.
In Kenya, where the population is about 58.6 million and cement demand was estimated at 9.3 million metric tonnes in 2025, a 50kg bag sold for about $5.40, equivalent to N7,344.
In Tanzania, with a population of about 66.3 million and similar cement demand, the product sold for about $4.80, equivalent to N6,528.
In Togo, where the commission said there were no limestone deposits, a 50kg bag sold for about $6.75, or N9,180.
The commission said the price disparities raised questions about why Nigeria’s significant production capacity and raw material endowment had not translated into lower domestic prices.
Cement manufacturers and other industry participants have attributed the rising prices to energy costs, naira depreciation and its effect on imported machinery and spare parts, as well as transportation and logistics expenses.
However, the FCCPC said it was testing those explanations against verified information on production costs, pricing, capacity utilisation and other market conditions.
“Of particular concern to the Commission is that this level of production capacity has not resulted in the downward pressure on domestic prices that might ordinarily be expected in a competitive market with substantial excess capacity,” it said.
The commission said the investigation would determine whether prevailing cement prices were being driven by legitimate costs and market conditions or by anti-competitive practices.
It said the probe would examine possible coordinated conduct, abuse of market power, restriction of domestic supply and anti-competitive distribution practices.
The FCCPC has consequently issued Notices of Commencement of Investigation and Summons to Produce to key players in the cement industry, demanding records relating to pricing methodologies, production, capacity utilisation, exports and commercial relationships.
The commission said the documents would assist it in determining whether the current price levels were justified by legitimate market factors.
Commenting on the probe, the Executive Vice Chairman and Chief Executive Officer of the FCCPC, Tunji Bello, said the investigation was necessary because of the strategic importance of cement to the Nigerian economy.
“Cement occupies a strategic place in the Nigerian economy. Its price affects the cost of building a home, developing commercial property, delivering public infrastructure and, ultimately, the cost of doing business,” Bello said.
He stressed that the investigation was not intended to dictate how companies should operate or prevent them from making legitimate profits.
“Businesses are entitled to make legitimate commercial decisions and earn returns on their investments. Competition law does not prevent that,” he said.
“Its purpose is to protect the competitive process, so that prices, output and other market outcomes are determined by genuine competition rather than conduct that unlawfully restricts it.”
The investigation comes amid growing concerns in the construction sector, where rising cement prices have increased the cost of housing and infrastructure development across the country.
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