Cement demand, imports seen rising; supply enough for projects

Cement demand in the country is expected to further rise from the 6-7 percent annual average growth as the Department of Trade and Industry is starting preparation to ensure that construction materials are sufficient to support the government’s massive “Build, Build, Build” program and the R10-billion reconstruction budget for Marawi City.

Ernesto M. Ordoñez, president of the Cement Manufacturers Association of the Philippines (CeMAP), said during a press conference following the National Price Coordinating Council (NPCC) meeting that cement demand last year reached 26 million metric tons (MMT) as against local cement plants’ total production capacity of 30 MMT.

According to Ordoñez, demand of cement has been growing an average of 6-7 percent annually over the past five years.

In 2016, total cement demand already reached 26 MMT, including imported cement, but Ordoñez would not venture to say how much of this total cement consumption were locally produced. Instead, Ordoñez quoted other sources who told him that imports have been growing between 7-8 percent annually.

Imports are coming in to augment local supply in light of robust demand. According to Ordoñez, even members of CeMAP are also importing cement, mostly from China and Vietnam.

DTI Secretary Ramon M. Lopez told reporters after the NPCC meeting that after ensuring stable supply and prices of food in Mindanao, the government is now preparing for the rehabilitation of the region thus, government is ensuring there is enough buffer stock of construction materials, especially cement, steel, and roofing materials.

Prices of cement in the country range from a low of R215 to R240 per 40-kilogram bag. Ordoñez said cement prices have not really moved up for the past few years. He said that two firms are now completing their documentation for the registration of their cement plants in the country.

The R 10-billion rehabilitation budget for Marawi, which has been heavily bombed by government forces since May 23 this year to eliminate the terrorist Maute Group, will only cover the physical structures of the city.

The livelihood programs and other rehabilitation efforts for Marawi residents will come from other agencies, including the P3 program, a R1-billion fund for micro and small enterprises.

Overall, Lopez reported that prices of basic goods and prime commodities have remained stable even in areas surrounding the conflict areas of Marawi. Except for garlic prices which are sold at R350 a kilo in two markets in Davao, supply and prices remained stable.

Lopez said that should Marawi be placed under a state of calamity even after Martial Law is lifted, there will be an automatic extension of the price freeze order in the region. Stephen Cua, president of Philippine Amalgamated Supermarkets Association, said some items have increased by 2-8 percent but said this is more of a pricing strategy by some companies. (BCM)