Chairman of BUA Group, Rabiu Abdulsamad, has faulted Dangote Cement and Lafarge for the rising cost of cement, stating that the situation will force his company to raise price by 11.47%.
Abdulsamad revealed that his company, BUA Cement, had reduced its product price by 10% per bag, in order to compel his rivals to cut their prices, but none followed suit.
He made this comment during his visit to President Muhammadu Buhari over the weekend. Abdulsamad’s statement trailed the price of cement bag rising by 21.05% in December.
The market price rose from an average cost of N3,800 per bag to N4,600. The hike had forced the governor of the Central Bank of Nigeria (CBN), Godwin Emefiele, to appeal to manufacturers in the construction sector to cut cement and steel prices in January 2022.
While speaking with state house correspondents, Abdulsamad said his company wiped off N350 from its cement bag price, with the ex-factory cost standing at N3,000 or N3,050.
Dangote, Lafarge to blame for current Cement cost
Abdulsamad stated that the reduction was intended to cause a price war or competitive pricing between BUA Cement, Dangote Cement and Lafarge. However the rivals held on to their high cost.
He explained that their decision not to budge could compel BUA Group to raise its product cost to meet the current market price, because the “dealers and the distributors are the ones that are actually making the money.”
It was gathered that distributors and the dealers are making almost N800 to N1,000 per bag, a situation Abdulsamad described as “unacceptable”.
He said the situation had put BUA Cement in a quagmire, and the company is contemplating on increasing its price level to about N3,350 or N3,400 to compete with Dangote and Lafarge.
This is the second price hike accusation against Aliko Dangote’s companies by BUA, as Ripples Nigeria had reported two weeks ago that BUA Foods alleged price fixing against Dangote Sugar and Flour Mills of Nigeria – both companies denied the statement.
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