Construction materials’ prices in Lagos area remain unstable
Construction materials have yet again taken a leap in the building materials market in the Lagos area, following a review of prices by dealers, raising fears among prospective homebuilders of even harsher times to come in the New year.
The out-going year witnessed a season of much inconsistency in the prices of building materials, especially cement-based products as dealers hiked prices to the tune of N2, 900 per bag compared to the price tag of N2, 200 per 50 kilogram bag last year. The Guardian investigation shows, many developers and prospective homeowners who earlier suspended their construction activities due to the rainy season are going back to site as dry season weigh in.
Consequently, the development impacted prices of Sandcrete blocks with the industry market prices rising from N200 and N230 for a six-inch and nine-inch block categories to N220 and N250 respectively.Industry specialists say the situation largely due tothe economic recession has was plunged the building materials’ market into high prices to the rate of about 200 per cent.
Findings further revealed that many of the manufacturers have had to contend with the ever dwindling capacity utilization of their plants, occasioned by disruptions in gas supply, while the high cost of Automotive Gasoline Oil (AGO), known as diesel, which used to sell between N110 to N130 per litre made alternative power supply visibly inaccessible.
Giving detailed analysis of the trends for the out-going year, a Cement retailer based in Ikeja, Lagos who spoke with The Guardian, Mr. Sunday Ilesanmi, submitted that they expected a fall in price of cement for the year, rather, it has remained at the rate of N2, 700 per bag for about two month now compared to N2, 800 and N2, 900 that prices rose to, in the past six months.
“The experience is quite alarming this year. We have seen so many instabilities in the prices of cement. This year alone, from January, we sold cement for N2, 200, N2, 450, even N2, 700. For the past six months, it was horrible, but from October to ending of November 2017, now two months, prices have remained constant at N2, 700. As a result of the hike in prices that we experienced in the year, the sales were so lull only one popular brand was moving amid other brands”.
“We learnt from the factory that the cost of production during the year caused the undulation of prices. If Dangote reduced its prices, we usually experience a boom in sales because our buyers like their products than the other existing brands in the market. For now, we buy 100bags from the factory inclusive of the cost of transportation for N260, 000”, Ilesanmi explained.
According to him, if government could rejig the economy in the coming year by making sure that manufacturers have less difficulties in accessing their basic production necessities, especially the foreign exchange and production materials, builders, developers and contractor would be happen for it. He stated that such a gesture would boost sales and caused a reduction in the sales prices.
The Chairman, Lagos State Block and Concrete Makers/Cement Dealers Association, Agege and Ifako Ijaiye Local Government Zone, Pastor Timothy Ayo’ola said the prices of blocks have were also affected.
“The big issue is on the instabilities in the prices of cement which is affecting the sales of our product. Last year, the nine inches was sold for N150/N160 while the nine inches was sold for N170/N180”.He advised that operators must learn to follow stipulated price that government has put in place while regulatory agencies should be empowered to monitor and ensure that people comply.
“What the government can do is to set up a special body of experts that would go from one area to another to make sure that the dealers maintain the same selling price. The government must sanction those who refused to comply. Government should also make the business environment friendly and provide basic infrastructure for the manufacturers,” he posited.
Prices of Steel rod also rose to the high heaven in the course of the year. Investigation for the year show that 1 whole length of 25mm steel rod sold for N4, 500, N5, 000 and above between May and October 2017. The one tonne (42pcs/tonne) of 25mm steel rod stood staggeringly at N180, 000 , N185, and above while a whole length of 20mm steel rod was sold for N2, 600, N2, 700 and N2, 800 respectively.
The paint industry was not left out of the hike in prices of building based product. The popular White Colour Eagle Paint brand, which was sold for N1, 500 and colour N1, 400 for four litres between January and May 2017 rose to N2, 000 and N1, 900 respectively during the year depending on the location. While the 20 litres drum sold for N7, 000 (white) and N6, 300 before, now sell for N10, 000 and N8, 900 respectively.
A dealer whose shop is located in Agidingbi, Lagos, Mr. Bolaji Akeem, said the increase in price by manufacturers caused a lull in sales for the year as he had to depend on other sources of income to meet up with his and family daily needs.
“ The Emulsion (colour) sells at present for N10, 000, the low goes for N5, 000, colour gloss high is N5, 000. The textcote is about N13, 000 which was N9, 000 before and the gloss which was N3, 500 before, now sells between N5, 000 and N6, 000. While Matt which was sold for N13, 000 before, is now sells for N16, 000 and Satin which was N17, 000 before, now sells for N25, 000”.
According to Akeem, the increase during the year was about 30per cent stressing it debars many people who would have loved to paint and repaint their houses from doing so stressing that patronage stood at about 40per cent for the year.He advised that the government and other stakeholders must find a lasting solution to the exchange rate problem.
On her part, the Chief Executive Officer of Builders’ delight, Lagos who sells the Precious Paint, Mrs. Oyinade Adeyemi, explained that the 20 litres of Emulsion sold for N3, 500 in the first and second quarter of the year rose to N4, 200 and N5, 500 depending on the colour while the four litres sold before for N700, now sells for N1, 000 per bucket.
She stressed the need for setting up of independent price monitoring body devoid of markers control to properly ensure that buyers are not unnecessarily exploited as well as to maintain uniform selling prices irrespective of locations.
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