For the entire year that ended on December 31, 2023, Dangote Cement Plc, BUA Cement Plc, and Lafarge Africa Plc blew N598.137 billion on fuel and electricity.
This is a 42.45% increase over the N419.879 billion that was recorded in 2022 for the same period.
This amount spent amounts to 40.39% of the N1.481 trillion total cost of sales that the cement companies reported for the period under consideration.
This follows a period of high inflation in 2023 that caused prices for goods and services to increase nationwide.
The data can be found in the audited half-year results of the Nairametrics-tracked enterprises. The devaluation of the Naira, the elimination of gasoline subsidies, and the harmonization of currency rates were some of the causes of these cost pressures. However, macroeconomic inflationary pressure was also a factor, particularly in the domestic market where average inflation spiked.
Since the state power grid infrastructure cannot produce enough reliable power to suit their needs, Nigerian cement makers primarily generate their electricity.
Manufacturers are forced to rely significantly on self-generation, often at great expense, as they have not seen any discernible increase in the supply of electricity, even after the power sector was privatized for almost ten years. However, the one essential infrastructure needed to grow the manufacturing sector and provide employment is power.
