Cement prices seen stabilizing

BusinessWorld

Posted at Feb 03 2010 12:16 AM | Updated as of Feb 03 2010 08:16 AM

MANILA, Philippines - Cement prices are stabilizing, the trade department yesterday said, as several manufacturers have either backtracked on plans to raise prices or are being made to explain reported cases of overcharging.

Cemex Philippines has taken back an announcement to slap a 5% increase for its cement products after the Trade department demanded justification, Undersecretary Zenaida C. Maglaya told reporters yesterday.

Lafarge Philippines, meanwhile, has been ordered to refute a dealer’s claim that the manufacturer was selling cement above the P190 government suggested ex-plant price for per 40-kilo bag.

"Prices have stabilized and supply has normalized," said Ms. Maglaya.

Earlier, the department had at one point issued 150 notices of violation to retailers found selling beyond the reference price and even threatened to impose a price cap, as consumers seeking to repair storm-damaged homes complained of cement priced as high as P270 a bag and inadequate supply. It went on to consult manufacturers to gather suggested ex-plant prices to be used to police dealers and retailers.

The three manufacturers -- Cemex, Lafarge, and Holcim Philippines, Inc. -- then wrote the department in early January on their plans to hike prices, Ms. Maglaya said, which the department in turn asked to explain.

"[But] Cemex took back their 5% increase early last week," Ms. Maglaya said.

Lafarge, meanwhile, has gone ahead with its P2-P3 price hike, as did Holcim for cement delivered in Northern Luzon, she said.

The price levels could not be confirmed with the cement firms as of press time.

Despite this, she noted that prevailing prices now match the P205-P210 suggested retail price.

The department, she added, is waiting for Lafarge to explain a dealer’s claim of having bought cement at a price higher than the suggested ex-plant cost. "It’s their word against the receipt," Ms. Maglaya said.