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A number of manufacturing companies have shut down because they cannot have access to annealed cold rolled—their major raw material— from Western Metal Products Company Limited (WEMPCO) Group, the only company authorised to produce the input.
Right from the government of Goodluck Jonathan, Wempco has been the only company allowed to produce annealed cold-rolled steel and supply to other downstream firms which use it to make aluminium products and wheel barrows. But for a long time, the company has been unable to produce the steel and is even accused of importing the product.
The implication is that manufacturers using the input cannot import it because they are not allowed to, and cannot get it from Wempco which is currently battling survival.
Already, Grif, maker of aluminium drums, has exited Nigeria for this reason.
The cold-rolled steel is one of the items on the Central Bank of Nigeria’s list of 41 items banned from accessing foreign exchange since 2016.
Also, Federated Steel from China, maker of iron rods, has exited Nigeria and sold its assets to MNIL Limited.
Another iron rod maker, Universal Steel, has shut down.
BusinessDay gathered from reliable sources in the steel sector that Industrial And Farm Equipment Company, a maker of wheel barrow, has exited.
A big aluminium maker Wahum is on the verge of shut-down as it can’t produce because it is unable to get cold-rolled steel.
“This is not how to run an economy,” an affected steel sector player, said.
“It is counter-productive and helps nobody,” the steel sector player said.
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