Dangote Cement Plc, Africa’s largest producer of the building material, cut prices in Nigeria in an attempt to boost cement consumption and compete with imports.
The price cuts, to its 3X cement brand by N6,000 ($30.23) per metric ton, will still allow Dangote to achieve strong returns, Chief Executive Officer, Onne van der Weijde, told Bloomberg.
According to Wejde, the cement giants are hoping the lower prices will help increase export sales to neighbouring nations.
The company has struggled with fuel shortages in its home market this year , which have hurt demand, and in December it raised prices to protect profit margins amid a devaluing local currency.
About 42 percent of Dangote’s cement sales by volume were sold outside of Nigeria in July, the company said in the statement, compared with 22 percent in the first six months of the year, and just 8 percent in 2014.
Before the price increase in December, Dangote had reduced the cost of cement in November, causing a more than 20 percent slump in the market. Paris-based Lafarge SA is Dangote’s largest competitor in Nigeria.
Dangote Cement shares have fallen 13 percent this year to N174 , compared to the 14 percent drop of the Nigerian Stock Exchange All-Share Index.