See dealers reaction to Abdul Samad Rabiu claims on cement prices at N3,500

• Cement dealers across Nigeria have weighed in on Abdul Samad Rabiu's remarks that his company sells a bag of cement at N3,500
• Rabiu, the Chairman of BUA Group, also alleged that middlemen are taking advantage of the price to earn high profits
• Dealers have responded to Rabiu, alleging that cement manufacturers are not ready to reduce prices

Legit.ng journalist Dave Ibemere has over a decade of business journalism experience with in-depth knowledge of the Nigerian economy, stocks, and general market trends.

In a recent comment, Abdul Samad Rabiu, the chairman of the board of directors of BUA Cement, accused middlemen of frustrating his efforts to crash cement prices to N3,500 per bag.

Speaking at the 8th Annual General Meeting of the company in Abuja, Rabiu said that the pricing was thwarted by dealers who exploited the situation, selling the same product at inflated prices of N7,000 and N8,000 per bag to Nigerians.

Rabiu accuses dealer of reselling cheap cement at high prices Photo credit: Bloomberg/contributor
Source: Getty Images

The billionaire also mentioned the foreign exchange rate, rising costs of operation, and the unwillingness of other manufacturers as some of the reasons the company decided to reverse its N3,500 per bag price.

Dealers reply BUA cement chairman

In response to the remarks of BUA chairman, Kayode Animashaun, a major stakeholder in the cement business, claimed that cement manufacturers in the country have deliberately refused to bring down the prices of cement, Tribune reports.

Animashaun noted that the claims of the Rabiu is true.

His words:

"The recent excuse advanced by the chairman of BUA Cement is unacceptable. There is no way dealers would buy at 3,500 and sell at 8,000.“We understand that gimmick they play most time. The big players want to outshine each other and one of the ways they do it is to make statements in the public that are not in tune with the reality on the ground."

Another, Ahmed Magaji, a stakeholder in the cement distribution value chain across the country, was quoted as saying:

"There is no way dealers would get a bag of cement for 3,500 and sell for 8,000. Don’t forget that most of us dealers buy on credit and remit monies when we come for a new stock"

Prices of BUA, Dangote, other cement brands rise

Legit.ng reported that the effects of naira devaluation and high inflation have caused a 121% increase in cement production cost, which analysts say might trigger higher prices in Nigeria.

Cement manufacturers also said smuggling is rising in Nigeria, hampering the chances of selling cheaper products.

The manufacturers say the product's price is higher in neighbouring countries than in Nigeria

Source: Legit.ng