Fresh from hearing the announcement that Nigeria is officially in recession, Nigerians woke up Wednesday to discover that the price of cement has shot up by a whopping 35 per cent to sell at N2,300 from N1,200 it sold just hours earlier.
The Second Vice President , Nigeria Institute of Building (NIOB), Mr. Kunle Awobodu said the increase may have been as a result of cost of production and the devaluation of the naira, reports The Nation.
He lamented that with the hike, the cost of construction will increase while the need for cost variation in all ongoing contracts and abandonment of projects may become inevitable, adding that it may also discourage people from embarking on new projects.
He said: “Clients, contractors and quantity surveyors may have disagreements due to price variations. New price on old contracts in a competitive bidding may eventually lead to sub-standardisation in construction.”
A cement distributor in Arepo, Ogun State said the new price came as a surprise, adding that it many have been occasioned by the current economic down-turn. Another distributor at Ajah area of Lagos, Mr. Kunle Salami said he has stopped his requests for more supplies as he is not sure of his customers reactions.
He decried the increase and urged the government to intervene either in terms of policy for the manufacturing sector or the provision of constant electricity in order for them to thrive.
A survey by New Telegraph further revealed that while the product is sold at N2,300 in Lekki corridor, it is being sold between N2,150 and N2,200 in Ikeja, Mowe and Ibafo axis of Ogun State. When this newspaper made enquiries, a cement retailer in Ibafo, Mrs. Ibidun Oke, said: “That is how we see it.
My supplier just told me yesterday (Monday) that cement price has gone up from the factory. You know we are in change period and many things have happened since this government came on board.”
Former President of the Nigerian Institute of Building (NIOB), Mr. Chuks Omeife, said that the latest hike in cement price was confusing. “We don’t know what is going on here. We are confused because there is no explanation adduced for it,” he said.
However, he blamed the situation on foreign exchange and monopolistic nature of cement manufacturers in Nigeria. If the situation persists, Omeife stated that housing projects are going to be delayed with increase in cost of delivering affordable units.
He said: “If the price increase in cement remains for a long time, it is going to compound the problems of affordable housing in the country because it will trickle down to block manufacturers and artisans.”
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