In a surprising revelation, Nigerian billionaire Abdul Samad Rabiu, chairman of BUA Cement, has disclosed how his company’s attempt to reduce cement prices to N3,500 per bag was thwarted by unscrupulous dealers who inflated the price, selling it for as much as N8,000 per bag to Nigerians.
Speaking at BUA Cement’s 8th Annual General Meeting in Abuja, Rabiu explained that the company initially slashed prices to make cement more affordable for consumers. However, dealers exploited this goodwill, doubling the prices and pocketing massive profits at the expense of ordinary Nigerians.
“We were selling cement at N3,500, hoping that dealers and retailers would pass the savings on to consumers. Instead, they took advantage, selling at N7,000 to N8,000 per bag. We sold more than a million tons at this reduced price before we realized what was happening,” Rabiu said.
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The situation forced BUA Cement to reconsider its pricing strategy, especially as the company faced challenges due to the naira’s devaluation, volatile exchange rates, and escalating business costs. Despite their best efforts, the company could not maintain the low price amidst these economic pressures.
Rabiu also pointed out that other cement manufacturers were unwilling to lower their prices, leaving BUA as the only company attempting to make cement more affordable. “The exchange rate worsened significantly from about N450 to as much as N1,900 to $1 making it impossible for us to continue at N3,500 per bag. Other manufacturers refused to reduce their prices, and we couldn’t meet market demand alone at that level,” he stated.
This revelation comes at a time when Nigerian consumers are grappling with the high cost of building materials, which has significantly impacted housing and infrastructure development across the country. The manipulation of cement prices by dealers has added an additional burden to the already struggling masses.
