Gas supply disruption, naira devaluation affect Dangote Cement cost- CEO
- increases cement price by N600/bag
Chief Executive Officer, Dangote Cement Plc, Onne van der Weijde, has said that gas supply disruption in the Niger-Delta region of the country and devaluation of Naira are negatively impacting on the company’s cost of production.
He noted that though the sales growth remains robust in Nigeria with volumes up five per cent in July and August, the cement manufacturing, he said, was strategizing on cutting cost and increasing the price of cement by N600.
Weijde said the leading cement producing company would increase the price of cement to offset increased in costs caused by devaluation and accelerate coal mining installation expected to begin in November
Dangote Cement boss in a statement to the Nigerian Stock Exchange (NSE) said, “Disruption to the gas supply, our preferred fuel in Nigeria, has deteriorated in the present quarter. Alternative fuels such as LPFO, and to a much lesser extent coal, are up three times higher in costs and the need to use them instead of gas has led to a substantial cost increase.
“In addition, the naira has experienced a significant devaluation against the US Dollar over the past few weeks. Both of these external factors have combined to increase our costs substantially in our largest market”.
To mitigate the impact of the cost increase, he said, “We have previously indicated that we would increase the price of cement to offset the increase in costs caused by devaluation and other cost factors. The present situation has regrettably forced us to increase the ex-factory price of cement by N600, bringing back to levels only marginally above they were before we announced a price decrease in September last year.
“We have accelerated installation of our coal mills and coal mining initiative in Nigeria and now expect to begin mining our own coal in November. Most of our production lines are now capable of running entirely on coal and this drive towards self-sufficiency will almost eliminate our dependence on gas supplies, imported coal and, more significantly, LPFO.
“Own-mined coal will be cheaper than gas, which in priced in US$ but paid in Naira. Furthermore, being transacted entirely in Naira, it will reduce our need for foreign currency at this foreign-currency at this difficult time for the Nigerian economy,” he explained.
Gas supply disruption, naira devaluation affect Dangote Cement cost- CEO https://t.co/pWmpjZ1AWE
Good info. Lucky me I reach on your website by accident, I bookmarked it.
9/22/2016 at 17:52:13 Regards from danglekatangul
9/24/2016 @ 18:12:00 In my estimation, business247ng.com does a excellent job of dealing with subject matter of this type. Even if ofttimes deliberately contentious, the information is in the main well researched and thought-provoking.
Hello.This post was really remarkable, especially since I was looking for thoughts on this subject last week.
9/28/2016 I’m gratified with the way that business247ng.com covers this sort of topic. Generally to the point, often contentious, always well-written and more often than not quite thought-provoking.
I’m gratified by the manner in which business247ng.com covers this type of issue. Usually to the point, sometimes polemic, always thoughtful as well as stimulating.
9/30/2016 business247ng.com does it again! Very interesting site and a thought-provoking post. Keep up the good work!
10/2/2016 business247ng.com does it again! Quite a perceptive site and a good post. Thanks!
Good, solid content. I just now forwarded this on 10/2/2016 to a fellow student who’s been involved in some work of her own on this topic. To say thank you, he just bought me a drink! So, I guess I should say: Thanks for the meal!
Quite a good read. I just now sent this on 10/5/2016 to a coworker who has been doing some work of her own on this topic. To say thank you, she just bought me lunch! So, let me express my gratitude by saying: Thank you for the meal!
Hey there are using WordPress for your site platform? I’m new to the blog world but I’m trying to get started and set up my own. Do you require any html coding knowledge to make your own blog? Any help would be really appreciated!
Hello there! Would you mind if I share your blog with my zynga group? There’s a lot of folks that I think would really enjoy your content. Please let me know. Cheers
10/9/2016 @ 10:44:02 Love this site– very informative and lots to see!
10/12/2016 Appreciate the website– extremely easy to navigate and much to think about!
Hello! Would you mind if I share your blog with my zynga group? There’s a lot of people that I think would really enjoy your content. Please let me know. Cheers
An attention-grabbing dialogue is value comment. I feel that it’s best to write more on this subject, it might not be a taboo topic but typically persons are not enough to speak on such topics. To the next. Cheers
10/17/2016 In my view, business247ng.com does a great job of covering issues like this. While sometimes intentionally polemic, the information is more often than not well-written and challenging.
very good publish, i actually love this website, keep on it
2. Hope to see more of your work soon.
great website and on topic
10/22/2016 I’m pleased by the manner in which business247ng.com deals with this type of issue. Generally on point, sometimes contentious, consistently well-written and more often than not quite thought-provoking.
Love the website– very informative and lots to see!