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Cement no longer scarce but costly
2008-04-27 10:55:41
By Business Writer
Cement may no longer be a scarce product but its prices still hurts consumers, this paper has learnt. Earlier, it was claimed that the shortage of the item was driving prices high, haunting the lucrative construction industry, but with the problem of shortage resolved, one would have expected prices to come down. Yet they have remained unchanged.
Two months ago, retail prices of cement stood at 14,500/- and 15,000/- for a 50 kg bag in Dar es Salaam, but latest survey shows the item now selling at 15,500/- and 16,000/-. In some upcountry regions, prices are even higher.
Business analysts blame transportation costs due to ever rising world oil prices which have made almost every commodity more expensive.
``We still cannot get consignments of cement to meet demand. But we are also forced to increase prices to cover increased transport costs,`` said Ali Mohamed, a construction material store owner.
Prices of cement began pushing up seven months ago as demand increased due to a booming construction industry.
Hardest hit by price-demand push were the ordinary people building living houses who stopped their projects due to increased costs.
``I suspended building my house after a cost review gave me a prohibitive budget.
I am hoping that cement prices will go down further to give us a relief,`` said Jackson Haule in Dar es Salaam recently.
Total demand of cement in the country is estimated to be 1.6 million tonnes per year while local production stands at 1.7 million tonnes.
The government in February had once again issued permits to six companies to import at least a total of 150,000 tonnes of cement in March and April.
The move came after it revoked permits of 15 companies for failure to import cement as agreed.
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