BUA Foods Plc, owned by Nigeria’s second-wealthiest man, Abdul Samad Rabiu, has spent over $200 million in its integrated sugar plantation in Lafiagi, Kwara state, to lessen reliance on FX and its influence on raw materials.
Ayodele Abioye, managing director of BUA Foods, said this during a press meeting at the company’s headquarters in Lagos.
According to the speaker, the majority of the company’s raw materials rely on foreign exchange due to Nigeria’s lack of industrialized sugarcane production.
BUA Foods is part of the BUG Group, which includes BUA Sugar Refinery, BUA Oil Mills Limited, IRS Flour, IRS Pasta, and BUA Rice Limited.
The corporation is owned by Nigeria’s second richest man, Abdul Samad Rabiu.
The sugar estate covers 20,000 hectares and contains a cultural estate, a 20,000 metric tons refinery, and the capacity to crush 15,000 tonnes of sugarcane each day.
- The estate also contains:
- An industrial ethanol plant.
- Schools.
- An estate under construction.
- A three-kilometre airport.
BUA Foods reported a 74% growth in sales, but experienced difficulty in strategic planning due to exchange rate volatility and increased exchange rate by the Nigeria Customs Service.
On February 15, the exchange rate increased by 59.15% to N1,515 per dollar, which significantly impacted the corporation, according to Abioye.
The Nigerian Customs Service bases its FX rates on recommendations from the Central Bank of Nigeria (CBN), and the recent modifications mark the sixth time in February that the top bank has adjusted FX for cargo clearance.
BUA Foods’ CEO lamented the difficulty in planning caused by FX volatility, claiming that the company suffered four changes in the exchange rates in one week.
Abioye told stakeholders that the corporation actively manages variations to keep product pricing low.
According to Legit.ng, BUA Group’s head, Abdul Samad Rabiu, has approved a 50% increase in staff salary to prioritize employee welfare.
Mohammed Wali, the head of Human Resources at BUA Group, made the decision public in an internal memo.
It came after reports that the price of a 50kg bag of cement had risen to about N9,500 in several sections of Lagos and across the country, highlighting Nigeria’s crippling inflation.
