Cross Udo
The BUA Group has blamed middlemen and other competitors for the current high price of cement products despite its decision to crash the price in the country by 10 percent.
Chairman of BUA Group, Alhaji Abdulsamad Rabiu, stated this while addressing State House Correspondents after a meeting with President Muhammadu Buhari at the Presidential Villa, Abuja. Alhaji Rabiu said his company had worked to make the product affordable by increasing production and slashing the price.
According to him, the group slashed the price per bag of its cement by N350, which he said is about 10% price reduction, but noted that despite this gesture, which was actually with the intent of dropping prices, distributors and other competitors had made it rather impossible to allow the effort show.
He, however, disclosed that the Group is holding talks with other cement producers to reduce the price of cement in Nigeria.
“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 percent 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 it, 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”, he said.
“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.
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“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.”
Asked if the recent policy by the Central Bank of Nigeria to discontinue the sale of FOREX to deposit money banks by the end of the year would not affect the company’s prospects as it still imports some of its materials for cement production, he said, “I think the CBN made it very clear that they will always be there to support.
“The CBN Governor was in Sokoto when we commissioned the Sokoto plant. And he promised that he stands ready to support the cement industry and any industry in Nigeria today that is ready to add value to produce what we have here in Nigeria”, he said.
