Investigation: Dangote Cement Not on Sale in Benin Republic

Investigation: Dangote Cement Not on Sale in Benin Republic

… Cement sells at an average price of N6,216 in Benin despite the regulation

The allegation that went viral on social media last week that Dangote Cement Plc was selling a bag of 50kg cement to Nigerians at an exploitative rate of N5,200 while it sells the same quantity of cement at N1,500 in the Republic of Benin was not true.

THISDAY’s investigation in Cotonou at the weekend revealed that Dangote Cement was not on sale in Cotonou or anywhere in the Republic of Benin.

While Dangote does not officially export cement to Benin Republic, it only uses the country as its transit route to export cement to Togo.

It was discovered that the average price of 50kg (32.5r) bag of cement in the Benin Republic was N6,216, which was about 4,200 Cefa).

According to THISDAY’s investigation in cement depots in Akpakpa, Ghandi and Etoile Rouse (Red Star) sections in Cotonou, the price of 50kg bag of cement goes for 4,000 Cefa, 4,100 Cefa and 4,200 Cefa at different cement depots in Cotonou.

In addition, THISDAY was told that the same quantity of cement goes for 4,500 Cefa (about N6,660) in Parakou, which was the largest city in northern Benin because of transport and logistics costs.

This implied that the average prices of 50kg bag of cement in Cotonuo and Parakou were N6,068, and N6,660 respectively, at the parallel market exchange rate of 1.00 Cefa to N1.48.

The two strongest determinants of the price of cement in the Republic of Benin, according to THISDAY’s findings, were the fixing of cement’s price by the country’s government to ensure stability and the imposition of about 51 per cent duty and other taxes on imported cement to discourage importation of the commodity and encourage local production of cement.

Among the leading cements brands in Cotonou are Cimbenin Buffle, Ciment Bouclier, Nouvelle Cimenterie du Benin and the Ciment Diamant, which a manufactured in the country. These are mainly 32.5R grade in contrast to Dangote Cement’s 42.5R cement grade that is on sale in Nigeria.

An online publication had published a story on August 27, 2023, in which it had stated that, “Nigerians have taken to social media to call out billionaire Aliko Dangote for selling his bag of cement for N5,200 in his own country but selling at N1,500 in Benin Republic.”

The online publication had reported that “a Twitter user identified as @drpenking called out Dangote for selling his bag of cement for N5,200 in Nigeria despite the fact that the raw material is sourced locally in Nigeria.

“He (@drpenking) tweeted: ‘Dangote cement is produced in Nigeria. The raw material is sourced locally in Nigeria at almost zero cost. Nothing is imported. Almost zero taxes yet the price of cement is N5,200  in Nigeria and same is sold in Seme, Benin Republic at N1,500 . Sit & Explain to me (sic).’”

However, a Cotonou-based Chief Executive Officer of Marketing Challenge Agency (MCA), Mr. Dia Ibrahim Kola, told THISDAY in Cotonou last Friday that the government of the Republic of Benin was striving to maintain stable price of cement in the country through price regulation regime instead of subsidising its supply.

Kola said: “There is only one price for cement in the country. This is 78,000 Cefa per tonne of cement. But the retail prices of 50kg bag of cement vary from 4,000 Cefa, 4,100 Cefa and 4,200 Cefa. But the price is higher in Parakou in the northern part of the country” where it oscillates between 88,000 Cefa and 90,000 Cefa per tonne.”

He said the country’s policy was to discourage importation of cement and encourage its local production with high import duty and taxes for cements that does not qualify under the ECOWAS Trade Liberalisation Schem (ETLS).

“We have about four cement manufacturers, including Lafarge and others. The government has a fixed price and often sent taskforce to monitor compliance especially in Cotonou.

“But it is important to emphasise that government does not subsidise the price of cement in Benin. There was a period of high scarcity that the price went up to CFA 100,000 per tonne, which forced the government to intervene to stabilise the market,” he said.

Kola recalled that the only time he had seen Dangote Cement being sold in the country was four years ago by a Nigerian woman around Igolo, that is close to the Nigerian border, adding that she might have smuggled it in.

However, the management of Dangote Cement Plc has clarified that the price of a bag of cement from its factories across Nigeria as at August 28, 2023, was N4,010 (about 2,730 Cefa) in Okpella and N4,640 (about 3,135 Cefa) in Ibese, Objana, and Gboko.

It added that transportation costs and the location of delivery, might cause the prices to hover between N5,000 and N5,300 per bag 50kg.

This clarification was made in view of recent misinformation that the company sells cement in Nigeria at significantly higher prices relative to other countries, particularly the Republic of Benin, and other neighbouring countries.

Dangote Cement’s Group Managing Director, Mr. Arvind Pathak, advised that it was important to distinguish Dangote Cement’s ex-factory prices from prices at which retailers sell cement in the market.

Pathak said Dangote Cement was focused on delivering quality cement at the best price possible, despite the current inflationary environment.

“We continue to innovate new ways to deliver quality products to millions of our customers across Africa, while providing top-notch customer services. At Dangote Cement, we are committed to building an inclusive and sustainable business for all stakeholders across the value chain,” he said.