How dealers sabotaged plan to slash cement prices to ₦3,500 _BUA CEO

BUA Cement Plc’s Chairman, Abdul Samad Rabiu has disclosed how his company’s attempt to reduce cement prices to ₦3,500 per bag was thwarted by unscrupulous dealers who capitalised on the situation, inflating prices to as much as ₦7,000 or ₦8,000 per bag while purchasing from BUA at ₦3,500.

During the 8th Annual General Meeting on Thursday, August 29, Rabiu detailed how the dealers exploited the company’s price reduction policy to profit.

Rabiu explained that many dealers failed to pass on the savings to customers despite BUA Cement’s decision to lower prices.

“A lot of the dealers took advantage of that policy. Rather than pass the low prices to the customers, they were selling at even double the price we sold to them,” Rabiu stated.

Also Read: BUA announces 40% slash in cement price
The chairman further noted that the manipulation was so widespread that BUA had already sold over a million tons of cement at the reduced price before realising the extent of the undercutting.

He revealed that external economic factors, including the devaluation of the naira and the removal of the fuel subsidy, also contributed to the unsustainability of the pricing policy.

Rabiu emphasised, “We wanted that price to stay at that level, but dealers refused. So, we could not sustain that simply because we did not want to be in a situation where we are subsidising dealers.”

Recall BUA Cement Plc’s Chairman, Abdul Samad Rabiu after meeting with President Bola Tinubu in Abuja had announced the reduction of the country’s cement price by 40%, from the initial N5,500 to between N3,000 and N3,500 per bag.

Rabiu said the price crash is part of his company’s contribution to supporting the efforts of the Federal Government to stabilize the prices of essential commodities.

Rabiu said the company could only do this because it produces it locally.

“Eighty per cent of the raw materials we use to produce cement in Nigeria are mainly limestone and gypsum, and of course, energy is part of it. Of course, we have gas in Nigeria,” he said.