Consumers should brace for higher cement prices following the decision of the Tariff Commission to raise the safeguard duties to P12 per 40-kilogram bag of imported cement from the provisional P8.40 per bag.
The commission concluded its investigation on the influx of imported cement in the country and found that imports were hurting the local cement manufacturing industry.
Cement importers, however, asked the Trade Department to review the duties recommended by the Tariff Commission, saying they would impact on the cost of construction and infrastructure projects.
“But somehow the increase will positively raise the revenues of the local manufacturing companies. We, as importers, can only earn so much. But we will continue to import if only to fill the shortage that local cement cannot serve,” said Philippine Cement Importers Association president Napoleon Co.
Cement companies argued that there was enough domestic supply of cement while Philcement Corp., one of the biggest importers, claimed that there was a supply deficit of 6 million metric tons.
Importers also cited other costs aside from safeguard duties. These include stevedoring, trucking and warehousing charges which are also factored into the total cement prices.
Trade Secretary Ramon Lopez said the department was open to evaluating the result of the Tariff Commission’s investigation, “but we welcome their findings that there was injury to the industry and that the safeguard duty should be P297 per MT or P12 per 40-kg bag.”
The Trade Department asked for a week to determine if the government should impose a cap or ceiling on the price of local cement.
Data from importers showed that demand for cement reached 34 million MT, while domestic production was only 28 million MT.
“On top of the additional cost we importers need to pass on, we still have to deal with price increases due to increased demand and insufficient supply,” Co said.
Cement imports account for 6 percent of local supply and most of the imports were procured by the cement companies themselves “but they shifted to clinker importation in 2017”, according to the importers.
Unlike cement, clinker imports are not subjected to safeguard measure as it is still a step away from producing cement.
Cement companies imported at least 4 million MT clinker and about 1 million MT cement in 2017, while cement importers bought only 600,000 MT from other countries.