- BUA appears to have pointed a finger at Dangote and Lafarge in the ongoing dispute over who is to blame for the country's soaring cement prices
- After a visit to Aso Rock, Abdulsamad, the chairman of BUA Cement, disclosed to journalists that the company has cut its product price by 10% per bag, but could make changes soon
- In the first three and a half months of 2021, the three cement giants made over N1.4 trillion in revenue from cement sales
The price of cement could increase further in the coming months as the Chairman and Chief Executive Officer of BUA Group, Abdul Samad Rabiu contemplates an upward review of cement prices.
Rabiu revealed this over the weekend to state house media after the group's team met with President Muhammadu Buhari, according to the Punch daily.
According to him, his company increased cement output and reduced prices by 10% per bag, but he was unable to gain the backing of other cement makers, who he blamed for the high cost of the product in the country.
In December 2021, prices of cement rose to N4,600 from an average of N3,800 per bag in the building materials market according to TheCable.
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What is Rabiu saying
Nigeria's second richest man said:
Everyone is complaining about the exorbitant cost of cement in Nigeria. That is, of course, due to a lack of available capacity.
We decided to cut the price of cement by N350 per bag when we started production on the fourth line at Sokoto a few weeks ago, when Mr. President went there to commission the facility. And that amounts to around 10% of the whole price."
So, today, our pricing is N3,000 or N3,050 ex-factory, but it hasn't been reflected in the market since the other two producers haven't decreased the price of cement, so we're in a dilemma.
Rabiu added that his company is holding talks with other cement producers to reduce the price of cement in Nigeria while stressing that it is impossible to achieve desired results on its own.
Expected change in prices
Rabiu however expressed disappointment that all the players are actually not giving support.
"We genuinely expected that by lowering the price by N350, other companies would likely follow suit. That has not occurred. And we've seen a situation where the price of cement is still high, so distributors and dealers make between N800 and N1000 each bag."
"That is completely unacceptable. Because our initial goal in doing so was to create a situation in which end-users would profit from the price drop.
He further revealed that his company are contemplating an increase our price to the level of the other producers, which I think is N3,350 or N3,400.
Cement giants record N1.4 trillion revenue in 9 months
Meanwhile, a check on the financials of the Dangote Cement, BUA Cement and Lafarge Cement shows that in the first 9 months of 2021, the three companies made over N1.4 trillion.
Dangote made over N1.02 trillion followed by Lafarge Cements N219.19 billion and BUA cement's N186.9 billion revenue.
Dangote, Rabiu companies dominate the list of most valuable manufacturing companies
Legit.ng had earlier reported that Dangote cement and BUA cement are the two most valuable listed manufacturing companies in Nigeria.
BUA foods another company owned by Abdulsamad sat in the third position while Nestle Nigeria completed the list of top four valuable manufacturing companies.
The ranking of the banks is according to data from the Nigerian Exchange Group (NGX) and compiled by Nairametrics.