KARACHI, Feb 28: While the government is yet to come out with a decision regarding ban on cement exports or allowing import to cut prices, builders and manufacturers have made conflicting claims. The former has claimed rise in prices while the latter reporting decline over the last week.
The builders informed the government on Tuesday about cement price hike in the last few days in Karachi. They said that time has come that the government should allow import of cement and impose a ban on exports in order to control the prices at the domestic level.
However, the cement dealers in Karachi said the prices had been on the decline since last week and may come down further due to the government’s stern warning to the cement manufacturers.
Chairman Association of Builders and Developers (Abad) Hafiz ur Rahman Butt said that the association had informed the industries minister that cement prices in Karachi had increased by Rs10-15 per 50 kg bag.
“Prices of cement should come down to Rs200 per 50 kg bag but it has not happened yet,” he said urging the government to implement the measures it had promised during the February 20 meeting in Islamabad between the cement makers, builders and contractors.
Butt urged the government to break the cartel of cement makers so that prices could come to a reasonable level. He said that cement prices had been increased to Rs230-235 from Rs220-225 in just few days.
However, Convener Karachi Cement Dealers and Welfare Association, Shaukat Hussain said that the wholesale rate of Dadabhoy cement had come down to Rs215 from Rs240-250, while Falcon cement had plunged to Rs240 from Rs265 followed by a decline in Lucky cement price to Rs227 from Rs250.
It depends on the retailers as to how much profit they charge ranging between Rs5 to Rs10 per 50 kg bag. He was of the view that the cement prices should hover between Rs200-210 per 50 kg bag.
Chairman All Pakistan Cement Manufacturers Association (APCMA), Aizaz Shaikh told Dawn from Lahore that cement prices had tumbled down from the average retail price of Rs260 per 50 kg to Rs235 in Punjab. Even in Karachi cement is selling below Rs235.
However, he sounded a note of caution that increase in power tariff by 10 per cent would lead to increase in cost of production. The impact of increase in power rates may result in increase of Rs5 per 50 kg bag.
He said that the cement makers were unlikely to pass on this impact of power rates to the consumers because of the current slump in demand. The recent rains in various parts of the country had resulted in a slowdown in sales of cement.
To a query over future government’s move to put a ban on cement export or allow its import, Aizaz said that the government did not have any justification right now for taking such harsh actions when the prices have fallen in the market at retail level. He also rejected the builders’ claim that the cement prices had gone up again.
Based on the retail price of Rs235 per bag, the ex-factory price hovers between Rs200-210 in which the government eats up Rs70 in terms of taxes and duties, APCMA chairman claimed.
