By Agregor Ebiboere Immaculate

Nigeria’s cement industry is grappling with low domestic demand and rising production costs, even as industry stakeholders say the sector has significant potential for expansion.

The Chief Executive Officer of HBM Nigeria, Lolu Alade-Akinyemi, disclosed this at the Experiencing Panterra event in Lagos, where he noted that Nigeria’s per-capita cement consumption remains below 150 kilogrammes.

According to him, the figure is significantly lower than the estimated 500kg recorded in Egypt and about 700kg in South Africa.

Alade-Akinyemi, who was represented at the event by HBM’s General Manager, Readymix Concrete, Emmanuel Ilaboya, said cement manufacturers are currently operating at between 20 and 30 per cent of their production capacity.

He explained that the low capacity utilisation reflects weak demand but also indicates that there is considerable room for growth in Nigeria’s cement market.

The HBM chief identified foreign exchange pressures and high energy costs as some of the major factors contributing to the rising cost of cement production in the country.

He said several critical inputs required for cement and concrete production are imported, while the cost of locally produced gas and other oil-related inputs is also influenced by dollar-denominated pricing.

Alade-Akinyemi further identified unreliable electricity supply from the national grid as another major challenge confronting manufacturers.

He noted that cement companies are often compelled to construct and operate their own power plants, requiring substantial capital investment and adding to overall production costs.

However, he said the relative stability of the naira exchange rate over the past year has provided some relief, allowing manufacturers to forecast costs more effectively and improve operational planning.

Meanwhile, the Chief Executive Officer of Panterra, Tayo Odunsi, called for greater transparency in Nigeria’s real estate sector.

Odunsi said the industry currently lacks a standard repository of reliable information that investors and other stakeholders can easily access when making decisions.

Also speaking, Panterra’s Chief Investment Officer, Ayo Ibaru, said currency stability, improved access to financing, security and growing investments from Gulf, Turkish and Asian investors are influencing the development of West Africa’s real estate market.

Ibaru identified the $15.6 billion Abidjan-Lagos Corridor as another major opportunity capable of stimulating investment across the region.

According to him, the corridor, which will link five countries, could drive the development of industrial zones, port cities, logistics infrastructure and real estate along its route.

Stakeholders at the event emphasised the need for policies and investments that will reduce production costs, strengthen infrastructure and unlock the huge growth potential in Nigeria’s construction and real estate sectors.