Cement on the rise again
Stabroek News
July 16, 2004
Cement prices are on the rise again in part pushed up by higher freight costs attributed to the new maritime security measures.
Prices have jumped from $860 to $980, so far for July, as Trinidad Cement Limited continues to struggle to supply the Guyana market which is undergoing a construction boom. Figures from Anral Investment Ltd., for cement prices from June 2003 to July 12 indicate that the price has increased by some 23%. It comes at a time when world demand is up sharply with China consuming around 50% of the world's supplies.
Jacob Rambarran, of R&R International notes that prices have increased because freight charges have gone up due to a new International Ship and Port Security(ISPS) Code. Freight charges per container of cement have increased by US$300. TCL's prices have also increased.
At Toolsie Persaud Ltd., cement is being sold for $980 a sack and at R&R for $980 as of last Thursday. R&R International is not retailing cement and only sells wholesale quantities.
Four months ago, cement shortages, which saw prices reach $1000, caused the government to drop the Common External Tariff applied to firms importing extra-regional cement.
The shortage occurred after TCL, Guyana's major supplier, was unable to meet demand brought about in part by large infrastructure works.
However, local wholesalers have not been able to take advantage of this waiver since it is difficult to procure cement from alternate suppliers in Colombia and Venezuela. TCL has been importing cement from these sources and reselling to the local suppliers along with its own cement.
In addition, TCL's plants in the Caribbean have a large domestic demand. At TCL's plant in Jamaica the demand for cement is so great that cement is often not exported to other countries.
In TCL's Barbados and Trinidad plants, the prices are much higher than the exporting price. Cement is being sold for as much as US$10 in both islands compared to the retail price here of below G$1000, says Rambarran.
On April 7, an agreement was signed to establish a bagging plant at the Guyana National Industrial Company Inc. The terminal is to be open in November and while this could ease the shortage it is only to bag the cement and will not necessarily solve the supply problem, says Rambarran.
He adds that cement is perishable and the further you go to procure it, the cost increases, adding that they could bring cement from as far as the Middle East.