N1,000 Profit Made By Distributors On Each Bag Of Cement Unacceptable—BUA Boss

The Chairman of BUA Group of Companies, Alhaji Abdul Samad Rabiu has accused middlemen and dealers of cement as making over N1,000 profit on each bag of the product.

He also blamed other manufacturers of cement for the high price of the commodity in the country.

Rabiu said described the N1,000 profit made by middlemen and dealers of the product as high as N1,000 and unacceptable.

The price of cement had risen by 40 per cent one year after Nigeria’s largest cement manufacturers boated of crashing cement prices in the country.

Dangote Cement and BUA Cement had locked horns in February 2021 following the increase in the price of cement.

During the period, cement prices were trading between N3,200 to N3,400. In 2020 the prices of cement went up to N4,000.

Few days into 2022, cement went as high as N4,800 per bag. The development had triggered a surge in the overall cost of construction projects causing panic among developers.

But the BUA Boss lamented that despite efforts made by his company to reduce the price of cement by ten per cent and make the product affordable to Nigerians, such efforts are being frustrated by middlemen and other competitors.

He said, “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.”

He further said the Group was holding talks with other cement producers with a view to reducing cement price nationwide.

According to him: “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.”