….Dangote Sugar Refinery denies involvement in price fixing, asserts its strong participation in NSMP
…BUA accuses Dangote of campaign to shut down BUA, others
The trade war between Dangote Sugar Refinery Company and BUA Sugar Refinery and others over the latter’s accusation of efforts by Dangote to get its plant shut by government for price reduction has heightened with denials and counter accusations from both sides.
In its reply to the allegations of campaign to get the plant of BUA refinery another major stakeholder revoked,Dangote has denied such claims .
In a statement by it’s Group Managing Director, Ravindra Singvi,Dangote Sugar Refinery PLC denied such allegations and claims.
Said he, “Dangote Sugar Refinery PLC (DSR) is aware of an online publication claiming that Dangote Sugar Refinery PLC is engaging in price-fixing and is not honestly engaged in any geared Backward Integration Programme as claimed.
feared
DSR wishes to vehemently refute the allegations and assertions in their entirety as the false allegations are geared at tarnishing the good name and brand of Dangote Sugar Refinery Plc and Dangote Industries Limited.
“DSR does not engage in artificial price manipulation of its products, either during the Holy month of Ramadan or at any other time. We have never ever increased price of our food items or commodities during the Holy month of Ramadan in the history of our operations”, according to the Group Managing Director, Mr. Ravindra Singhvi.
He also added that the Company is socially responsible and considers price-fixing to be unethical. Such allegation is highly mischievous and a calculated attempt to smear the reputation of DSR. DSR can only sadly conclude that the online publication is mischievous and geared at creating some form of undue advantage to some Industry players, he said.
He said that the company began its Backward Integration Programme (BIP) with a 10-year sugar development plan, to produce 1.5 million MT per annum of sugar from locally grown sugarcane. The Project commenced with acquisition of large expanse of land in strategic locations such as Taraba State, Adamawa State and Nasarawa State. To this end, three (3) BIP sugar companies; Dangote Taraba Sugar Limited, Dangote Adamawa Sugar Limited, Nasarawa Sugar Company Limited were incorporated.
The Company had commenced rehabilitation and expansion of its Sugar Factory at Numan. Sugarcane planting has also commenced in the two other BIP locations.
DSR has a responsibility to the Government, the good people of Nigeria and the Sugar Industry and all other stakeholders to protect the integrity of the Sugar industry and wishes to assure its stakeholders as follows: It will do all that is necessary to vehemently protect the integrity of the Sugar Industry, it is not engaged in price fixing and it encourages healthy competition amongst the players.
DSR highlighted a matter (BUA’s operation of a Sugar refinery in the Free Trade Zone in Port Harcourt, exporting refined sugar into the Custom territory) which may circumvent the National Sugar Master Plan’s (NSMP) framework and jeopardize its objectives by taking advantage of the location of its Port-Harcourt Refinery in the Free Trade Zone. DSR made this notification to the Hon. Minister of Industry, Trade & Investments bona fide, via its letter to the Minister dated January 28, 2021 asking the Minister to investigate the matter.
We believe our action is in line with our responsibility as a major stakeholder to alert the supervising Ministry on activities that would derail the plan of the Federal Government in its drive to self -sufficiency in Sugar under the NSMP.
It will be recalled that an Online publication (not Newdawnngr.com) has published that BUA Sugar Refinery has accused Dangote Refinery of petitioning the Trade Ministry asking the latter to shut down its refinery over a Price War.
In the claim of the BUA Sugar Refinery industry based in Port Harcourt , it stated that Dangote action was as a result of its refusal to increase price of Sugar during Ramadan season.
The BUA refinery had claimed that,”In a letter dated 28th January, 2021 signed by Aliko Dangote himself as the Chairman Dangote Industries Limited, the billionaire claimed that when the BUA Sugar refinery was opened , he warned the Government and they told him that’ no new refinery would be allowed to operate in Nigeria’. Dangote accused BUA of operating with impunity by contavening the laws as laid down in the National sugar policy by selling it’s products locally instead of producing for export alone.
However,BUA in its own defence sent to the Honourable Minister of Trade however clarified issues by stating that the law allows it to sell inside Nigeria.
BUA also warned that DANGOTE group and the other major player have not been involved in any backward integration project, rather they depend on 80% raw sugar allocation which is detrimental to the Nigerian economy in long term analysis. BUA on the other hand has been involved in backward integration project with BUA’s Lafiagi Sugar BIP set to be completed in 2022.
The BUA group claimed that it has spent over 250million dollars on the export focused BUA sugar refinery already and it is also employing over 1,000 Nigerians.
The group also noted that at the centre of this fight to force FG to close BUA Sugar refinery down is the price war.
Investigation revealed that said last year, before Ramadan, sugar sold for around 18,000 Naira per bag. But as Ramadan fasting started the price jumped to 30,000 per bag. The people had no choice but to buy it because they needed a lot of it during the period. So the manufacturers were smiling to the bank.
However,as a result of this development,BUA group was said to have decided to change the trend stating that there was no reason to increase the price during Ramadan simply because the demand is high.
Usually the increase happens about one month to commencement of fasting.
It was alleged that when the other manufacturers got across to BUA groups chairman, Samad Rabiu he refuse to effect a change in price. They allegedly put pressure on him, saying it was the right time to make good money but the former put his feet down.
However,it was gathered that after failing to do that, they petitioned the Federal Government that he was breaking the law by selling sugar locally instead of for export.
