Alhaji Kabiru Rabiu, the Group Executive Director of BUA Group, has shed light on the company’s decision to lower the price of a 50kg bag of cement to approximately N3,500 last year. He explained that this reduction was implemented as a bonanza for consumers.
Rabiu confirmed that the price reduction initiative lasted for over five months. However, he noted that middlemen capitalized on the gesture, depriving end-users of the intended benefits in the industry.
He stated, “Our chairman made the commitment, and we executed a reduction in price, maintaining it for five months across our plants, selling cement for N3,500 ex-factory. But, as is common in the Nigerian cement industry, when such commitments are made, we expect other players to follow suit.”
READ ALSO: Rising Cost Of Living: BUA Announces 50% Salary Increment For Staff
Rabiu emphasized the challenges faced when other manufacturers did not lower their prices in tandem. Despite BUA Group’s efforts to support the economy by selling cement at a reduced rate, the lack of participation from competitors hindered the direct benefits to end-users.
The decision to revert to previous prices was influenced by rising production costs and challenges encountered in one of BUA Group’s production plants, which experienced reduced output. This situation placed significant pressure on cement supplies, exacerbating the gap between factory prices and market rates.
Rabiu highlighted, “One of the plants faced challenges with reduced production, leading to increased demand and widening the gap between our factory prices and market rates.”