Displaying items by tag: Ibeto
US investors visit Nigercem cement plant
07 August 2018Nigeria: A group of investors from the US have visited Ibeto Cement’s Nigercem plant in Nkalagu. The visit was part of an assessment to prepare Ibeto Cement for a listing on a stock exchange in the US, according to the This Day newspaper. Cletus Madubugwu Ibeto, the chief executive officer (CEO) of Ibeto Group said that Chinese contractors were due to work on upgrading the plant to a production capacity of 6000t/day with a 45MW waste heat recovery unit. In May 2018 Beta Cement signed an investment deal with US-based private equity firm Milost Global for US$850m.
Ibeto and Nigercem ownership dispute continues
07 January 2015Nigeria: The Ebonyi State Government in Nigeria has warned Ibeto Cement Company over an alleged illegal entry into the premises of Nigercem cement premises located at Nkalagu. The entry was perceived as an act of provocation by governor Martin Elechi of Ebonyi State, as Nigercem is still subject of an ownership dispute in the courts.
"Following dispute between the State government and Ibeto Group on the ownership of Nigercem, Ebonyi State Government exercised its illegal right of land ownership by revoking the certificate of all the land upon which Nigercem is situated," said Elechi. "By going into the premises of Nigercem without the permission of the State Government, the Ibeto Group has demonstrated an alarming desire to acquire the God-given mineral wealth of Ebonyi people for its interest".
Eastern Bulkcem Nigeria Limited owns a 65% stake in Nigercem. The origins of the current dispute arise from Eastern Bulkcem's failure to modernise the ageing plant, instead opting to use its ownership of the plant to obtain import licences for bulk cement. The Ebonyi State Government resorted to extra-judicial means to shut it down, revoking Nigercem's certificate of occupancy pending a Judicial Commission to investigate the state of affairs in the company.
Nigeria’s overly neat cement industry
09 January 2013Nigeria's Minister of Trade and Investment, Olusegun Aganga brought together warring parties from Dangote and Ibeto Cement this week to discuss their very public spat about the state of the country's cement industry.
Claims that Nigeria is facing a 'glut' of cement have been building since the Cement Manufacturing Association of Nigeria (CMAN) declared that Nigeria was 'self-sufficient' in cement in late 2012. So when leading cement importer Ibeto Cement questioned this narrative, leading cement producers Dangote and Lafarge hit back. Aganga then announced a review of the country's industry.
Despite Nigeria's potential to consume cement, something is stopping it. Yet, as Ibeto Cement rightly asked, if Nigeria is producing too much cement why isn't the price falling?
Hard facts about the Nigerian cement industry are elusive. This is what we know. Nigeria's population is apparently 170m. Its cement industry has the capacity to produce 28Mt/yr (Global Cement Directory 2013). Its production level was 18.5Mt/yr in 2012 according to CMAN. However figures compiled by the United States Geological Survey placed production much lower at 11.6Mt in 2011. Consumption is believed to be 17-20Mt/yr. In 2011 it was 17Mt. Ibete Cement, the sole importer into the country, is allowed to import up to 1.5Mt/yr.
Nigeria's main producers include Dangote (19Mt/yr capacity, 70% of the market), Lafarge WAPCO (4.6Mt/yr, 17%), Unicem (2.5Mt/yr, 9%) and Ashaka Cement (2Mt/yr, 7%).
Hype about Nigeria's potential as a cement-producing nation hinges upon its low per capita consumption (110kg) compared to some of its African neighbours and indicators of expected growth such as a housing deficit of 16 million homes.
CMAN boss Joseph Makoju addressed this head-on, blaming the high cost of haulage and energy. He said that the energy cost accounts for over 35% of the production cost and that the price of low pour fuel oil (LPFO) had risen by over 300% from US$0.16/l in 2009 to US$0.69/l in November 2012. It should be pointed out that Makoju is also the special adviser to the president of Dangote Group, Aliko Dangote. Unsurprisingly he has advised the Federal Government to impose higher taxes on imported cement to discourage imports.
The production boom of recent years has been threatened by a weakening increase in demand. The gap between production and lower consumption estimates is around 1.5Mt. Dangote and Lafarge WAPCO's combined unsold stock at the end of 2012 was also just below 1.5Mt. Both figures are suspiciously close to the amount Ibeto is allowed to import annually. As usual, the easiest target is the cement importer. Dangote's political clout as a key Nigerian company, large-scale employer and all round African success-story will doubtless help its argument.
Yet if imports are really more competitive than Nigeria's domestic product how can the country possibly hope to export cement? Also this week Liberia announced it has relaxed its tariffs on cement. As luck would have it Dangote is building a new cement plant in the country. Sounds ideal for tricky import negotiations.
Nigerian minister announces industry review
09 January 2013Nigeria: Nigeria's Minister of Trade and Investment, Olusegun Aganga has announced that he will conduct an independent assessment of the country's cement industry to make it more competitive. The move follows a dispute between importer Ibeto Cement Company and leading producer Dangote Cement.
According to Aganga, at a meeting for stakeholders from the cement industry held on 7 January 2013 in Abuja, by the end of the entire review the Federal Government will draw up with a new strategy for the industry with three goals. The first is to bring down the price of cement in the country, the second is increase consumption of cement and the third is work on policies to open up the export market.
Aganga defended Nigeria's 10-year implementation of the Backward Integration Policy (BIP). According to Aganga the BIP has resulted in about US$6bn of investment in the sector, with a growth from 2Mt/yr to 28Mt/yr, and it has saved the country foreign exchange of about US$1.4bn/yr. The Nigerian cement industry provides direct and indirect employment for about two million people.
"We have achieved everything we set for ourselves 10 years ago when the BIP was introduced; we want to take the next step as part of our strategy on the way forward," said Aganga.
Leading Nigerian cement importer fights 'glut' claims
02 January 2013Nigeria: Ibeto Group, the owners of Ibeto Cement Company Limited, has stated that the cement the company imports into Nigeria is not responsible for any market surplus. In a statement issued by Ibeto Cement the company proposed that the first sign of a glut in the market of a product is a 'drastic' reduction in price. There has been no drop in the price of cement in Nigeria.
The group, in a statement signed by its executive director of Strategy and Public Affairs, Dr Ben Aghazu, argued that since it imports 1.5Mt/yr or less than 5% of the annual cement supply to the Nigerian market it cannot be held responsible for any surplus on the market. Ibeto Cement became the sole importer of cement into the country following an out of court settlement following the closure of its bagging plant in Bundu Ama in 2005. Ibteo Cement was subsequently allowed to import 1.5Mt/yr bulk cement from October 2007 until September 2017.
Aghazu further accused Dangote Group of trying to influence the Federal Government to 'invalidate' Ibteo's import quota by raising the taxes on imported cement or by banning clinker imports outright.
"Unfortunately, in our country the antitrust laws probably don't exist or aren't enforced when it pertains to the Dangote Group, which holds a monopolistic stranglehold on several significant and strategic sectors of the economy," said Aghazu.