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Paint makers raise prices, seek FG’s forex window

By Chinedum Uwaegbulam and Victor Gbonegun   |   10 October 2016   |   4:12 am


With declining stock of imported raw materials, paint operators are fighting for survival by increasing prices and contemplating job losses. To forestall a complete shutdown of factories, they are urging the government to grant them access to foreign exchange to facilitate the importation of raw materials.

The last is yet to be heard about the recession and its brutal effects on Nigeria’s manufacturing sector, as paint makers are currently increasing their prices to contend with the high rate of foreign exchange in the market.

The paint operators under the aegis of Paints Manufacturers Association of Nigeria (PMA) confirmed the development to The Guardian, revealing that the scarcity of dollar has impacted on their production process as 80 per cent of its raw materials are imported and supplied by associated member-companies.

They lamented that the stock of raw materials by members are dwindling, making it impossible to meet orders. According to the Executive Secretary, Mr. Jude Maduka, the government should wade into their plight and provide paint manufacturers access to foreign exchange as being done in other industrial concerns.

He foresees halt in production in several factories, which will lead to job losses in the sub-sector and associated industries such as resin manufacturers, raw materials suppliers, haulage companies, applicators and other service providers, if the government ignores their plea for assistance.

The Guardian investigation revealed that the major paint companies including President, Berger, Finecoats, Prestige Paints and Chemical and Allied Products (CAP) Plc manufacturers of Dulux paints have already reviewed their prices several times. Infact, Finecoats is adopting another new price from today while Prestige and President Paints increased prices few days ago.

Speaking on the development, a dealer with stores in Oko’Oba, Agidingbi and Ikeja area of Lagos, Mr. Bolaji Akeem said the increase in price by manufacturers has impacted on patronage negatively.

He explained that for Eagle Paint, white colours, which  was sold for N1, 500 and colour N1, 400 for four litres before but now goes for N2, 000 and N1, 900 respectively. While the 20 litres drum sold for N7,000 (white) and N6, 300 before, now sell for N10, 000 and N8, 900 respectively.

“The textcote is about N13, 000 which was N9, 000 before and the gloss which was N3, 500 before, now sells between N5, 000 and N6, 000. While Matt which was sold for N13, 000 before, is now sells for N16, 000 and Satin which was N17, 000 before, now sells for N25, 000”.

For him, the increase, which was about 30per cent, is too abnormal for the market. He recalled that patronage was as high as 70per cent before the increase, but now stood at about 40per cent.

He advised that the government and other stakeholders must find a lasting solution to the exchange rate problem.

The Managing Director of Yem Yem and Company, Ikeja, a dealer in Precious Paint, Mr. Adeyemi Ayoade, revealed that the 20 litres of Emulsion sold for N3, 000 before the hike to  N3, 200 and N3, 500 depending on the colour while the four litres sold before for N700, now sells for N1, 000 also depending on the colour.

He explained that developers, contractors and government are more familiar with the product, which they still classified as less expensive, relatively new but of high quality, unlike other popular brands in the market.

“The textcote for Precious sold for N4, 000 before but now sells for N4, 500.The increment started between January and February, 2016. Throughout 2015, we sold 20 litres at the rate of N2, 800 but as soon as dollars rate went up, it started affecting the price and the patronage”, he said.

An official of Soar Investment Limited, Lagos, said the exchange rate was largely responsible for the recent increase in prices as the raw materials are mainly sourced abroad. The dollar as at last week sold for about N470 to a dollar in the parallel market.

She said the prices across different products have increased as a four litres of Fine-coats been sold for N600 is now been sold for N700, 20 litre of Emulsion sold for N2, 700 now sold for N3, 000, Prestige paintwhich sold for N2, 800 increased from N3, 200 to N3, 300 and N3, 500 as at last week.

“The prices are becoming unstable as it change monthly and even twice within a month. When you have made quotation, you must call the factory to find out if the price was still the same unlike before when there is stability in price.

“Textcote is not a movable product, and so there is no much increment. Like before we sell for N3, 800, N4, 000, now it sells for N4, 500, that cheapest in the market. But for President, that has witnessed a drastically change. I just received an SMS this morning that their Text-coat earlier been sold for N10, 000 is now N15, 000.The one selling for N9, 500 is now N13, 000. Eagle Paint that we sell for N7, 500 is now N10, 000 for Emulsion.

According to her, the colours sold before the increase at the rate of N7, 000 is now N9, 500 and gloss sold for N2, 800 is now N3, 500 while the President Paint sold for N4, 000 before is now N6, 000, the CAPL red sold for N6, 000 is now N7, 500.

She revealed that the President paint rose by 50per cent, the Prestige Paint rose between 20 and 15per cent, for Eagle Paint increased by 40per cent and CAPL by 30per cent, amongst others, depending the quality of the product, adding that the gloss type of paints increased by 50per cent.

“The Matt price is almost the same thing with Emulsion but in the Satin, the price increased drastically. For instance, the President we sell for N17, 500 and N18, 000, we learnt from the company that it has been increased to about N30, 000. Satin for Eagle, which was earlier sold for N18, 000 is now N26, 000.”

According to her, some paint companies increased their prices and also increased the quality of their products.”

She pointed out that paint dealers are holding on to faith that if the dollar rate crashed, the price would come down noting that before there must be a stability, adding that patronage is now very low.

She said: “We are experiencing a shaking in Nigeria and I want to encourage others to be patient and be positive”.

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