Cement: BUA blames competitors, middlemen, for profiteering
...says middlemen making N1000 profit per bag
The BUA Group has blamed middlemen and other cement producers for manipulating the prices of cement out of the reach of ordinary Nigerians despite government’s efforts to make cement affordable for the people.
The Chairman and Chief Executive Officer of the Group, Abdul Samad Rabiu, said this recently when he led his company on a courtesy visit to President Muhammadu Buhari.
Alhaji Rabiu while speaking to to State House Correspondents in Abuja noted that his company has always ensured adequate supply of cement at a reasonable price but activities of middlemen have not allowed the benefit to get to Nigerians.
According to him, BUA had increased cement production and reduced the price by 10 per cent per bag adding that other cement manufacturers must take necessary steps ensure Nigerians are not unduly ripped off.
According to him, “I know everybody is talking about the high price of cement in Nigeria. And that is, of course, because we do not have enough capacity. When we started production, the fourth line in Sokoto a few weeks ago, when Mr President was there to commission the plant, we decided to actually reduce the price of cement by N350 per bag. And that is about 10 per cent of the price.
“So today, our price is N3,000 or N3,050 ex-factory, yet, that has actually not been reflected in the market, simply because the other two producers have actually not reduced the price of cement, so we’re having a challenge. We are actually in a quagmire now. We are discussing this because what is happening is that we have reduced, but the dealers and the distributors are the ones that are actually making the money. So, it’s a bit of an issue for us.”
The BUA Group Chairman revealed that his company is working with rival cement producers to stabilise the market.
He further explained, “If you don’t have the support of all the players, it would not be possible. We actually thought that by reducing the price of N350 that the other companies would probably follow suit. That has not happened. And we have seen a situation where the price of cement is still high, you know, so distributors and the dealers are making almost N800 to N1000 per bag.
“That is unacceptable. Because the idea initially when we did that was that we want the situation where the end-users will benefit from the price reduction. So now we are contemplating whether probably we have to increase our price to the level of the other producers, which I think is N3,350 or N3,400.”
