CEMENT DEALERS WORRIED OVER PRICE HIKE (MIRROR, PAGE 27)

From Rose Hayford Darko, Tema

Dealers and users of cement in Tema and Ashaiman have expressed dismay at the increase in price of the commodity without any prior information.
They have as a result threatened to stop doing business with Ghacem and look for other sources of supply where the same product will cost cheaper.
They were of the view that the increase in price had come at a time when Ghacem claimed to have achieved a record increase in production as at the end of December 2008.
Market survey showed that cement was being sold in Tema for between 10 and 12 Ghana cedis.
Some insiders said the increase had been the highest throughout the 41-year history of Ghacem.
They said the increase was not commensurate with the percentage depreciation of the cedi to the dollar.
The survey revealed that the world financial crisis had resulted in a decrease in freight and clinker prices, which rather called for a decrease in the price of cement.
The dealers and users wondered why the price of the commodity from West African Cement (WACEM) had remained unchanged.
They claimed that as partners in the business, Ghacem could have sought their concern and discussed with them before imposing the new price on them.
The Commercial Director of GHACEM, Mr Erik Wartemberg, confirmed the increase in prices of Ghacem cement to the mirror.
He said the price had been raised from GH¢ 8.05 to GH¢8.74 ex factory price, representing 70Gp difference but explained that it was basically because of the current exchange rate, where the cedi had depreciated against the dollar.
He said Ghacem imported about 70 per cent of its inputs, which compelled the company to increase the price by about 7 per cent.
Mr Wartemberg said the company was reacting to the global financial crisis, whose effect the country had started experiencing.
He said in spite of the increase in production in December 2008 and January 2009 the company made loses.
Mr Wartemberg denied that the company had enough stock that should last for over six months, noting that there were other additives that contributed to the production process.
The Corporate Strategic Planning Director of Ghacem, Dr George Dawson, noted that distributors had expressed dissatisfaction with the increase.
He appealed to them to accept the new price because “the increase was inevitable”.
Attempts to talk to the distributors’ association failed because according to them they had plans to come out appropriately because anytime there was increases, distributors were blamed for the shortages and increase in prices.
Meanwhile various projects that have cement as input could be affected if distributors decide to withdraw their services.