Certainly, these are not the best of times for distributors and retailers of BUA Cement, they have expressed discomfort over the alleged increase of ex-factory price of cement product by N200 per bag by the company. The cement manufacturer allegedly unveiled its new price increase from N2,800 to N3,000 per bag over the weekend.
The price review by the company is contrary to what it has repeatedly asserted that it does not have any justification to increase the price of cement as it is currently making enough returns.
It would be recalled that BUA Cement, in various statements issued between April 24 and June 18 this year, had refuted any claims of increase in the ex-factory price of its cement products by N300 per bag, stating that, “the company had no plans to increase prices of its cement now or in the near future.”
According to a statement issued on April 24, 2021, the company stated that, “the solution was not in an increase of ex-factory price at this period.”
The company, in its statement, had “reiterated its stand that the timing was not right for any increase in the price of major commodities, especially not at this period whilst Nigerians are still trying to recover from the economic consequences brought about by the Covid-19 pandemic – especially for a product for which all raw materials are locally sourced.”
On June 17, 2021, BUA Cement had issued a fresh statement titled ‘No Further Increase in the Price of BUA Cement’ in response to numerous clarification requests from its distributors and the public that the company does not seek to increase the ex-factory price of its cement in the foreseeable future.
“We are aware of the feedback and outcry from the public, and the government on the high retail price of cement in a period of economic recovery. BUA is also of the firm belief that the current retail prices of cement are higher than normal, hence our earlier communication not to increase ex-factory prices in the foreseeable future.
“As a responsible corporate entity, we refuse and reject associations with any actions that are deemed capable of projecting any industry we operate as a cartel. Hence, whilst we respect that the said company has decided to increase their prices, we are not questioning the reason(s) why, but would like to make clear BUA’s position on a price increase.
“The timing is not right for any increase on BUA’s part, and we do not have any justifiable business reason to increase our prices (ex-factory) anytime soon. We therefore urge our distributors not to panic as well as not engage in any arbitrary hike in the retail price of BUA Cement,” the statement read.
The alleged increase in the company’s ex-factory price of cement has generated ripples among distributors, retailers and consumers across the country, with many wondering at the sudden change of mind of the manufacturer.
In a market survey carried out on the price review, a cement distributor in Kano, who does not want his name mentioned, wondered why BUA Cement changed its cement price, contrary to expectations and its promise. “I don’t understand why BUA did this review at this particular time. The chairman of BUA, Abdulsamad Rabiu, personally promised us that his company will not increase the price of its cement. Honestly, this is not good for our business and the industry,” he lamented.
Another cement distributor based in Asaba, Delta State Sunday Odogwu, expressed anger at the price increase by BUA Cement, despite all his repeated promises of no further increase in the price of BUA cement.
According to Odogwu, “BUA told us several times before in their statements to distributors that they are not ready to increase their cement price. The last notice was just last month in June. Why are they doing this now? It is so not fair, and we are disappointed. Our customers will not understand all these and will be blaming us!”
“Initially, we believed the management of BUA as having sympathy for the populace. But this current position is not good for or business.”