Dealers’ Actions Prevented BUA from Selling Cement at N3,500 per Bag – Rabiu

AbdulSamad Rabiu, Chairman of BUA Cement, has revealed that his company’s plan to sell cement at N3,500 per bag in 2023 was thwarted by dealers’ actions.

Rabiu explained that BUA had sold over a million tons of cement to dealers at N3,500 per bag, with the intention of these lower prices reaching consumers. However, dealers were selling the cement to customers at inflated prices ranging from N7,000 to N8,000 per bag.

He noted that BUA Cement had to abandon the policy because it was not meant to provide financial support to dealers. Rabiu highlighted that the company could not control dealer pricing, which resulted in significant profit margins for them.

Rabiu stated, “Many dealers exploited the policy by not passing on the lower prices to customers. Instead, they sold the cement at double the price we offered them, ranging from N7,000 to N8,000 per bag. Despite selling over a million tons at N3,500, we only realized later what the dealers were doing.

“Additionally, the challenges of currency devaluation and the removal of the fuel subsidy made it impossible to maintain that pricing policy. We wanted to keep the price low, but dealers’ resistance and the rising exchange rates—from around N600 to N1,800 to the US dollar—forced us to reconsider. We could not sustain the policy as it was not intended to subsidize dealers.”