Abdul Samad Rabiu, chairman of BUA Group, says middlemen and other manufacturers of cement are responsible for the high cost of the product in the country.
Rabiu said this over the weekend while speaking with state house correspondents after the group’s delegation met with President Muhammadu Buhari.
In December 2021, prices of cement rose to N4,600 from an average of N3,800 per bag in the building materials market.
In January 2022, Godwin Emefiele, governor of the Central Bank of Nigeria (CBN), had urged manufacturing companies in the construction sector to reduce the prices of cement and steel.
According to Rabiu, despite the company’s effort to increase cement production and slash prices, the impact has not been felt in market prices.
“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,” he said
“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, 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.
“If you don’t have the support of all the players, it would not be possible. We actually thought that by reducing the price, 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. So, distributors and the dealers are making almost N800 to N1,000 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.”
