BrandSpur Nigeria reports that Chairman of BUA Cement PLC, Abdul Samad Rabiu has vowed to support the Tinubu-led Federal Government (FG) in ensuring a reduction in price per bag of local cement in Nigeria.
As of the time of filing this report, a bag of cement currently sells between N5000 and N5,100.
Speaking with journalists in Abuja at the 7th Annual General Meeting (AGM), Rabiu elaborated on plans by his firm to reduce the cost of cement per bag effective from December this year when two plants lined up would come up. BUA Cement, he said will collaborate, and work with the government in achieving reduced cost of cement.
Rabiu said, ” I appreciate where the government is coming from. I can understand the frustration from all the issues we are having in the country. The price of cement is under N5000 per bag in Nigeria; is not really very high if you look at the rate of the dollar. To import into Nigeria today will be almost N5,000 per bag.
“The cost of cement, CIF to any of the ports in Nigeria will be in the region of around $100 today per tonne and that is something that can be ascertained. But then you have the protocols-; the transportation from the ports to wherever you are taking them to. It’s not that the government wants to import cement, it’s just that they are frustrated that the price of cement is high”.
“What I am going to do? what I told my shareholders is that we will support the government because even though we know the price of cement is high, it cannot be cheaper if we import it.
“But what we want to do is, because we have two lines that are coming on stream by the end of the year; Obu line3 and the Sokoto line7, which will give us a combined capacity of 6 million tons and then by the time we have those two lines, we will be having a combined volume of 17million tons. So, what we want to do, is to support the government. Sit down with the minister to see how we can bring down the price of cement once we have those two lines up and running by the end of the year”.
“Am happy to support the government once these two lines are up and running. I can assure you that we’ll do everything to support the government and to support Nigerians. It is true that the price of cement is high maybe because of the devaluation issue that we are having in the country now, hence the reason why we decided that we are going to support and bring down the price of cement.
BUA Cement To Support FG In Ensuring A Favorable Cement Price
“This is my promise from. I know my price expertise is about N4000 and N4, 300 per bag. The target is to reduce that substantially when we start regardless of what other costs are.
“I will engage the minister and we are not doing that because we are worried that the government will allow imports because we know that imports will not be any cheaper. We are going to do that because we want to support the government and we want to support Nigeria and Nigerians.
“The reason why we want to wait until when we have the two lines that are going to come on stream by the end of the year, is simply because we will have additional volumes so that if we reduce the price, even if others have not agreed to reduce the price, the market will compel them to come down because if you do not have enough volumes and you reduce the price the market may not take it. If you have the volume and you reduce your price, and with the huge volumes that we have the price must come down”.
Rabiu said that with a strategy mapped by BUA Cement, other cement firms would have no choice but to reduce the cost of cement.
” If others are not ready to support the government, to support the reduction of the price of cement they will be compelled because if they don’t reduce they will not be able to sell. That is why we are going to wait till the end of the year when these two lines are on stream. I will discuss with the minister and see how we can do that”, he assured.