HBM's CEO Addresses Nigeria's Cement Prices and Growth

HBM, a Chinese-owned company, has addressed the high prices of cement in Nigeria, attributing them to foreign exchange exposure, high energy costs, and reliance on privately generated power. Lolu Alade-Akinyemi, HBM Nigeria’s Chief Executive Officer, stated that a significant portion of inputs for cement production is imported or priced in foreign currency, making manufacturers vulnerable to fluctuations in the naira.

Despite these challenges, he noted that the recent stability of the naira has improved manufacturers' ability to forecast expenses. Alade-Akinyemi also highlighted electricity costs as a major factor, as Nigerian producers often invest heavily in their own power infrastructure.

HBM is initiating a distributor recruitment drive to strengthen its distribution network and compete for a larger share of Nigeria's cement market. He emphasized that cement consumption in Nigeria is low compared to Egypt and South Africa, indicating considerable growth potential.

Capacity utilization among manufacturers is estimated at 20% to 30%, suggesting significant unused production capacity.