Nigeria’s Cement Paradox Production Surplus, Yet Consumers Face Rising Prices

Nigeria’s Cement Paradox Production Surplus, Yet Consumers Face Rising Prices Nigeria’s cement industry is facing renewed scrutiny as consumers continue to pay some of the highest prices for the building material in Africa despite the country having a production capacity far above domestic demand. A 50-kilogram bag of cement is currently selling between about ₦12,500 and ₦15,000 in several Nigerian markets, while comparable prices in some other African countries remain significantly lower. Industry comparisons show that cement prices in countries such as Egypt, South Africa, Kenya and Ghana are considerably below Nigeria’s retail levels. The situation has raised concerns among builders, property developers and housing advocates, who say high cement costs are worsening Nigeria’s housing challenges and increasing the cost of construction projects. With millions of Nigerians needing affordable housing, stakeholders argue that cheaper building materials are essential for closing the gap. Nigeria’s cement sector has expanded significantly over the years, with installed production capacity estimated at more than 60 million metric tonnes annually. However, domestic consumption is estimated at roughly 25–30 million tonnes, leaving the country with excess production capacity and allowing some output to be exported to neighbouring markets. The industry is largely controlled by three major producers: Dangote Cement, BUA Cement and Lafarge Africa. Together, the companies account for the majority of cement manufacturing capacity in the country. Manufacturers have argued that high prices are linked to rising production expenses, including energy costs, transportation challenges, foreign exchange pressures, imported equipment needs and distribution expenses. They maintain that producing cement locally does not automatically translate into lower prices because operational costs remain high. Government officials have expressed concern over the impact of expensive cement on infrastructure development. The Minister of Works has called for discussions with producers, warning that rising cement prices are putting pressure on construction budgets and public projects. Industry analysts say improving competition, reducing energy costs, strengthening transport networks and encouraging new investments could help reduce prices. Housing advocates have also called for policies that lower production costs and make cement more accessible to ordinary Nigerians.

As Nigeria continues to expand its cement manufacturing capacity, the central question remains why increased supply has not yet translated into cheaper prices for consumers. The answer, experts say, lies in addressing the wider costs of production, distribution and market competition.