Sugar War: Dangote Moves To "Edge Out" Competition, Demands Sanction Against BUA

Facts have emerged on how Nigeria's biggest sugar producer, Dangote Industries Limited, alongside another producer, flour mills of Nigeria plc, approached the federal government to reprimand BUA, their rival in a bid to shut down its business.

Correspondences exchanged between the companies and the federal ministry of trade and investment were exclusively obtained by POLITICS NIGERIA.

Their grouse is against BUA's most recent sugar refinery plant in the Bundu Free Trade Zone, Portharcourt, Rivers state capital, which they accused of importing raw materials against regulations and the National Sugar Master Plan (NSMP) hinged on the backward integration plan.

The development of NSMP commenced in 2008 under the administration of the late President Umaru Musa Yar’Adua but was approved and adopted in 2012 by the administration of former President Goodluck Jonathan.

The implementation of the plan took off in 2013 with an estimated target of producing 1.79 million tonnes of sugar locally by 2020 aimed at helping the sugar industry in Nigeria meet the national sugar demand through local production. Meanwhile, POLITICS NIGERIA’s findings have revealed that the somewhat malicious letter spearheaded and signed by the Chairman of Dangote Industries Limited, Aliko Dangote was targeted at stopping the new plant, which poses a threat to his business.

While the intent of his actions are not immediately clear, industry experts who spoke with our reporter posited that although BUA's new plant is majorly for exporting refined sugar, it can intervene in the local market and pay relevant duties when there is an increase in price as there is a subsisting approval for companies operating in Export Processing Zones – a law which Dangote is also a beneficiary of in his Lagos Petrolchemical Refinery in the Lekki Free Trade Zone.

"This may not augur well with Mr Dangote who wields much influence in the sugar industry. He'll not like a competitor that will checkmate him. We have seen this happen in the Cement industry and we hope they will realise that it is better they work together to expand the industry than bring anyone down," an expert said.

With the new refinery, the country's refining capacity goes from 2.75 million metric tons to 3.4 million metric tons per annum.

Alleged violation

In a letter addressed to the minister of trade and investment, Niyi Adebayo, the Chairmen of Dangote Industries Limited and Flour mills of Nigeria plc, Aliko Dangote and John Coumantaros respectively, on January 28, prayed that the government should sanction BUA. It should be noted that as part of their obligations to the NSMP, all refinery owners in Nigeria were expected to invest in significant local production through Backward Integration Project. Dangote bought Savannah Sugar, Flour Mills Golden Sugar bought Sunti Sugar and BUA bought Lafiagi Sugar.

The two companies – Dangote and Flour Mills, hinged their request on an alleged violation of the NSMP by their rival.

"As the Honourable Minister is aware, the Sugar Industry in Nigeria has been governed for a while now by the National Sugar Master Plan (NSMP) which is a well-designed policy to encourage Backward Integration in the Sugar Industry with the ultimate objective of attaining self-sufficiency in Sugar production locally.

Following the mid-term review of the NSMP, we recognize that there is a tremendous amount of work that is required by all stakeholders to achieve the intended objective behind the policy. It also became clear that if the policy is to have any chance of success, then efforts must be stepped up by the regulator, the National Sugar Development Council (NSDC) to ensure a disciplined and fair implementation of the policy

Honourable Minister, with this in mind we wish to humbly bring to your attention an important issue which we believe threatens and poses a threat to the attainment of the National Sugar Master Plan (NSMP) and the sustainability of Nigeria local sugar industry, of which our Companies are the best investors. Publicly available Information suggests that BUA International, one of the players in the Sugar Industry. has commissioned a sugar refinery plant in Port Harcourt, Rivers State. With the new refinery, the Country's refining capacity goes from 2.75 million metric tons to 3.4 million metric tons per annum, or from 170 percent over capacity over the last year's import quota to over 210 percent capacity," the letter read.

According to Messrs Dangote and Coumatanros, the mid term review conducted by the national sugar development Council indicated that BUA has failed to invest substantively in local production or comply with its undertakings under its BIP.

"Even before this surreptitious investment in additional refining capacity Nigeria already has enough refining capacity to satisfy demand today and well into the future. So, the business logic behind this investment is clearly defective. BUA intends only on importing and refining raw sugar whilst claiming to to investing in developing sugar plantations in order to qualify for quotas to import raw sugar."

"This investment in the Port Harcourt Refinery, was clearly done with the intention to undermine the NSMP We are particularly surprised by the brazenness as we believe that the choice of location and the publicity campaign behind the investment has been deliberately engineered to provoke public sentiment and pit the Federal Government of Nigeria against its people," the letter further stated.

While seeking the intervention of the federal government, Messrs Dangote and Coumatanros, demanded a level playing field that provides for fair competition in the local sugar market.

"An investigation should be conducted to determine the quantity of Raw sugar imported by the Refinery in Port Harcourt and the appropriate penalty in terms of duty (60%) and level (10%) be levied on the company," they demanded in the letter.

POLITICS NIGERIA learnt that BUA, apart from the new port harcourt refinery, has a 720,000 mt sugar refinery in Lagos and a 20,000 hectare Lafiagi Sugar Plantation and Ethanol Production Complex, all covered by the Backward Implementation Programme of the National Sugar Master Plan.

According to reliable sources, its flagship Lafiagi BIP project, despite being the last to be handed over by the federal government amongst the 3 producers, has seen significant progress which is measured at scheduled intervals by the Nigerian Sugar Development Council and also via peer reviews with the other players in question - In line with the dictates of the Nigeria Sugar Master Plan. The company recently completed an ethanol plant at the plantation and currently almost done with their sugar mill and refinery.

Although focused on exporting refined sugar, it could intervene in the local market following an arbitrary increase in price by the protesting companies as allowed by the laws of Nigeria. With its Nigerian Export Processing Zone Authority (NEPZA) licence, obtained by this newspaper, it can intervene locally in order to stabilise the price.

This newspaper could not immediately get the reaction of BUA as of the time of filing this report.

https://politicsnigeria.com/how-dangote-moved-to-edge-out-competition-demanded-sanction-against-rival-sugar-business/

Dangote and his silly monopoly. He can't compete fairly (even against his own people). I use to respect this man before now until I begin seeing him as a greedy individual. He is worst than a capitalist.

Na to deh short-change everyone cos he get people for high places. No be say na so him product good, they just give him the market and push down his substandard goods down on everyone.

Paadi paadi govt.

na them sabi, na same two brothers case so e no consign me

This Dangote man seems to be extremely greedy.

I am an Architect and a builder, I always prefer BUA cement to Dangote. The two no be mate for quality.

Finally, here comes a stiff competition for wicked and monopolistic dangote.
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If not for Abdulsamad Rabiu strong northern roots and political connections, Dangote would have as usual frustrated him out of business, but today Rabiu is a Forbes billionaire.
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I looking forward to BUA breakIing whatever left hegemony the Dangote establishment has on the nation.

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I also look forward to when Nigerians would realise Dangote for the devil he is and attack his trucks nationwide. I wonder how many trucks he can protect.

Dangote again? He should go and cover his bare ass all over the internet first.

Just like What they did to Ibeto.

I'm sure if Nigeria was not for the North, Dangote wouldn't have been the Richest Man in Nigeria, not to talk of Africa.

Dangote wants to monopolize every industry he can be able to with the help of Corrupt northern Cabals in Nigeria.


Infact no need, Biafra we move!

Just imagine. Useless entities always after their own self interest

Dangote should stop this bullying attitude and engage in productive competition.

Nigerian government should wake up from this nepotic act of monopolizing almost every production sectors under the control of a man, if such a man has a problem or demises, that will pose a great danger to the county's economy. The late business mogul MKO is a typical example. Free-trade system should be encouraged in our production sectors.

big man problem. Oligopolist at War. poor man still suffers...

We are buying a bag of cement @ 3800, middle finger for you dangote

Because he can't buy them over.

I doubt if what they are giving us today is Sugar.

In the days of St. Lious, once you get the sugar pack open, there is this big ants that comes to eat the sugar. But in today's sugar, if bring out the sugar and keep on the desk, the big ants doesn't come. Even if you take the sugar outside and still urinate on it, the big ants doesn't come.

Back in those days, when you dip a cube of sugar in water and put in pap, you can easily dissolve it with a plastic spoon. But today's sugar is as hard as stone. Even after dipping it in water, iron spoon still finds it difficult to dissolve it.

Two cubes of St. Lious use to turn my tea very sweet but three of these new generation sugar doesn't get my tea as sweet as before?

Is what we are taking today really sugar?

lol

Dangote....Warn yourself...make we no #enddangote....na only you.?? You wan enslave us with monopoly??

Plus Dangote, why are your truck drivers reckless?? Are they above the law ?

extol1:
na them sabi, na same two brothers case so e no consign me

They are both from Kano. But Rabiu is 100 times better than dangote. Rabiu gives back to the society. The significant roles he played in covid19 palava cannot be overlooked. But same can't be said of dangote... He just wanted everything to himself while others goes with nothing.

I remember when he fought this Rabiu on okpella limestone mining rights.

THE LATEST INSTALLMENT OF NAIRALAND’S NOW WEEKLY ANTI-DANGOTE “NEWS” STORY....LMAO!
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so dangote will not rest until he sends bua back to village?

Yh

An ordinary mai suya or okada rider has more business acumen than Dangote. Give a blind and deaf man monopoly in business and he will do better than Dangote.

Dangote has failed in all the businesses where he doesn't have monopolies. Noodles, juice, tomatoes. Even his pasta is the worst in the market with excess starch.

His sack-making company has folded up, he assembles trucks and they are the worst in the market as no one buys them. If you ever tasted Dangote Noodles, it tastes exactly like Dangote's business acumen. Terrible.

Even Dangote cement is the worst in the industry. Dangote has his major factory in Ogun state. Do you ever see Lagos or Ogun state Governments use Dangote cement on any of their projects?

Go and pull up pictures of buildings under construction in Lagos that collapsed. Check the brand of cement bags seen on the ground.

Outside Nigeria, Dangote's businesses are failing and not able to pull profit like Nigeria. That is because their governments are sensible enough to protect their citizens from a destructive monopolist.

Meanwhile, I don't pity BUA. When Dangote was doing same to Nkalagu cement company, Ashaka Cement, Benue Cement company, Ibeto cement and others, BUA and others kept quiet. Today, he has turned against his own brother from Kano.

Business rivalry

Selfishness in display

Na wa, you fight the guy over cement, fight him over sugar, now the guy is building his own refinery you go still fight am

Ogun kill dangote there.




Divide this shithole abeg

Nothing wrong in practicing a fair competition, or do u want to monopolise the sugar market

So that's how he became the "richest man in Africa"?

Before I think dangote is a genuine hustle but nao I understand better. His policy is killing Nigerians. Very soon we will hand over nigeria to dangote. Na to open school remain for am.

H

Dangote is number one problem of this country

BUA and others who are willing to go into any type of legal business in NIGERIA should be giving the same floor/right like Dangote, if not Dangote will put everyone in his pocket .

In Ghana Dangote Cement is not up to 2800 but in NIGERIA Dangote Cement is 4k, why is he this wicked to NIGERIANS ?.

So Dangote want to shut down someone business cos it a competitor,


if person wan come do biz wey dangote dey do make d person hold enough jazz for government to support cos d kind herbalist wey dangote dey use strong ooo

Dangote is a lazy business man...

Some Yorùbás Say something like "Owo o 'n tolowo"
True in these people's cases.



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