FCCPC Probes Pricing Manipulation as Cement Majors’ Profit Hits ₦1.17tn in H1

The Federal Competition and Consumer Protection Commission (FCCPC) has summoned major players in Nigeria’s cement sector, demanding detailed information on pricing methodologies, production, capacity utilisation, exports, and commercial relationships.

The move comes ahead of a formal industry investigation prompted by a three-month cross-border study suggesting possible price manipulation in the domestic cement market.

The probe follows concerns over the robust financial performance of the three largest cement producers—Dangote Cement Plc, BUA Cement Plc, and HBM Nigeria—in an environment where demand has slumped, and purchasing power is under pressure.

Analysis of their unaudited H1 2026 financials reveals combined profit after tax exceeding ₦1.17 trillion and revenues rising by about ₦752 billion year-on-year to approximately ₦3.92 trillion.

Dangote Cement remained the sector’s biggest earner, posting revenue of ₦2.51 trillion (up 21.4%) and profit after tax of ₦638.5 billion (up 22.7%). BUA Cement reported revenue of ₦728.9 billion (up 25.6%), with profit after tax surging 79.6% to ₦324.9 billion, driven by stronger operations and lower finance costs. HBM Nigeria posted the fastest revenue growth—up 31.2% to ₦678.4 billion—with profit after tax rising 57% to ₦208.3 billion.

Domestic Price Concerns Amid Excess Capacity

The scrutiny by the FCCPC is heightened by the continued rise in cement prices. A 50kg bag of cement, which sold for between ₦9,300 and ₦9,700 in January 2026, rose to ₦10,500–₦13,000 by mid-year, reaching as high as ₦15,000 in some locations by July.

This price escalation is occurring despite Nigeria’s substantial limestone deposits, reported installed production capacity exceeding 60 million metric tonnes, and domestic consumption of about 25–30 million metric tonnes. The FCCPC notes that such excess capacity should ordinarily exert downward pressure on prices in a competitive market.

Industry operators cite high energy costs, currency depreciation, costly machinery and spares, and rising logistics expenses as drivers of prices. However, the FCCPC is testing these claims against verified data on production costs, pricing, and market conditions.

The investigation will assess whether cement prices are justified by legitimate costs and market realities, or whether there is evidence of coordinated conduct, abuse of market power, supply restrictions, or anti-competitive distribution practices.

Notices and Summons Issued

The Commission has issued Notices of Commencement of Investigation and Summonses to leading cement firms, directing them to supply information on their pricing, production, capacity, exports, and commercial arrangements.

Strong Earnings and Continued Investment

Despite pricing concerns, the H1 2026 results show that major manufacturers continue to expand their productive capacity. Dangote Cement invested about ₦354.2 billion in property, plant, and equipment; HBM Nigeria increased capex to ₦141.5 billion (from ₦28.9 billion a year earlier); and BUA Cement maintained spending on expansion projects—demonstrating confidence in domestic demand and infrastructure growth.

Profitability is also rising faster than revenue for some firms, reflecting improved cost management, operational efficiency, and lower finance pressures. HBM Nigeria, for example, benefited from higher finance income and reduced finance costs.

Regulatory Focus and Economic Implications

FCCPC Executive Vice Chairman and CEO, Tunji Bello, said the intervention reflects the strategic importance of cement to the Nigerian economy, with prices influencing housing, commercial property, infrastructure costs, and the broader cost of doing business.

“Cement occupies a strategic place in the Nigerian economy. Its price affects the cost of building a home, developing commercial property, delivering public infrastructure, and, ultimately, the cost of doing business,” Bello said.

He stressed that the probe is not intended to dictate business decisions but to ensure the cement market is functioning competitively and consumers benefit from effective competition.

The outcome of the FCCPC investigation could have significant implications for Nigeria’s construction and manufacturing sectors, particularly as the government seeks to accelerate infrastructure development and lower the cost of housing and construction.