The Federal Competition and Consumer Protection Commission has launched a further investigation into Nigeria’s cement industry over suspected price manipulation following a three-month study of the sector.
The commission said its preliminary findings suggested that the sharp increase in cement prices could not be fully justified by prevailing market conditions, despite Nigeria’s large limestone reserves and significant production capacity.
The investigation was carried out by the FCCPC’s Anticompetitive Practices Department after widespread complaints over the rising cost of cement.
According to the commission, the study compared Nigeria’s market with those of Kenya, Tanzania, South Africa, Egypt, Morocco, Algeria and Togo, assessing factors such as limestone availability, production capacity, consumption, population and retail prices.
The FCCPC said Nigeria has an estimated installed cement production capacity of 60 million to 65 million metric tonnes annually, while domestic consumption stands at about 25 million to 30 million tonnes.
Despite the excess capacity and Nigeria’s status as a net exporter of cement to neighbouring countries, prices have continued to climb.
The commission said a 50kg bag that sold for between N9,300 and N9,700 in January had risen to N10,500-N13,000 by mid-year and reached N13,000-N15,000 in some locations by July.
The FCCPC also highlighted significant price differences between Nigeria and other African markets.
In Kenya, a 50kg bag reportedly sold for about $5.40, equivalent to N7,344, while the price was approximately $4.80, or N6,528, in Tanzania. In Togo, where the commission noted there are no limestone deposits, the same quantity sold for about $6.75, equivalent to N9,180.
The commission said the disparity raised questions about why Nigeria’s substantial production capacity and raw material reserves had not translated into lower domestic prices.
Cement producers have attributed the increases to factors including energy expenses, naira depreciation, imported equipment and spare parts, transportation and logistics.
However, the FCCPC said it was examining those explanations against verified information on production costs, pricing, capacity utilisation and other market conditions.
The commission said the next stage of the investigation would determine whether the prices were justified by legitimate costs or linked to potentially anti-competitive practices.
Areas under scrutiny include possible price coordination, abuse of market dominance, restrictions on domestic supply and anti-competitive distribution arrangements.
The FCCPC has issued Notices of Commencement of Investigation and Summons to Produce to major industry players, requiring them to provide information on pricing methods, production levels, capacity utilisation, exports and commercial dealings.
FCCPC Executive Vice Chairman, Tunji Bello, said the investigation was necessary because cement plays a critical role in housing, infrastructure and the wider 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. When concerns persist about how such an important market is functioning, the Commission has a duty to look beyond assumptions and establish the facts,” Bello said.
He clarified that the probe was not intended to dictate business decisions or prevent companies from making legitimate profits.
“Businesses are entitled to make legitimate commercial decisions and earn returns on their investments. Competition law does not prevent that. 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,” Bello said.
The investigation comes as escalating cement prices continue to put pressure on Nigeria’s construction industry, driving up the cost of housing and infrastructure projects.
