BUA Cement’s Plan to Lower Prices Foiled by Dealers: Cement Prices Remain High
Thank you for reading this post, don't forget to subscribe!Abdulsamad Rabiu, Chairman of BUA Cement Plc, revealed at the company’s 8th Annual General Meeting that a plan to reduce cement prices to ₦3,500 per bag last year was thwarted by dealers who exploited the situation for higher profits. Rabiu indicated that while BUA Cement aimed to offer lower prices, dealers increased prices significantly, selling at ₦7,000 to ₦8,000 per bag instead.
Rabiu attributed the failure of this pricing strategy to two main factors: the devaluation of the naira in 2023 and the removal of the fuel subsidy. He explained that despite BUA Cement’s efforts to maintain lower prices, the actions of dealers and the economic conditions made the policy unsustainable.
“We had sold over a million tons at ₦3,500 per bag before realizing the dealers were capitalizing on the policy,” Rabiu said. “Ultimately, we could not sustain the low price due to the dealers’ refusal to pass on the savings to customers and the broader economic challenges.”
