The erratic availability of cement on the market has triggered a surge in prices, with buyers spending as much as K43,000 per 50-kilogramme (kg) bag in some places in the Central and Northern regions.
The Nation random checks in Lilongwe City yesterday found that most outlets had no cement in stock while at Cashbuild, a multi-national hardware store, Tanthwe cement by Shayona Cement Corporation fetched K38 000 per bag.
On the other hand, at Nsungwi Market in Area 25, Lilongwe retail shops had no stocks, but the retailers said Tanthwe cement was pegged at K43 000 per bag. Few shops that had Akshar cement at Nsungwi were selling at K38 000 per bag.
The prices are double what the products were fetching in the first quarter of this year.
In an interview, an Area 25 resident Thomson Banda said his house project has stalled because the soaring prices are prohibitive.
” Just early this year, I used to buy a 50kg bag of cement at K17 000. I was determined to develop my plot at my pace but with the way prices have jumped, this is prohibitive,” he said.
In a separate interview, National Cons t r uction Industry Council (NCIC) chief executive officer Gerald Khonje said the rising cost of cement was a concern to the construction sector which anchors the country’s economic development.
He said: “Cement is very critical in construction and any price increase in cement affects infrastructure development so we are concerned as the industry.
“The scarcity of the commodity highlights the demand and supply imbalances because of many construction projects going on like the M1 and various water projects, but this is an opportunity for local cement producers to scale up production because the country has the raw materials.”
Commenting on suggestions of speculative step in and find ways to calm down the markets.”
Shayona Cement Corporation managing director Jitendara Patel asked for more time to comment.
However, Chamber of Mines and Minerals national coordinator Grain Malunga said escalating transport costs have contributed to the situation.
“Cement prices are increasing due to increase on transportation costs and prices of local raw materials. Coal prices have increased too at local and international level,” he said.
Meanwhile, Ministry of Trade and Industry spokesperson Patrick Botha said the ministry is aware of the current cement situation and it met key stakeholders on Tuesday.
He said: “As a key outcome, the ministry and the producers developed a targeted supply plan to address shortages in the Central and Northern regions, which have been most affected by the scarcity.”
Botha said the Competition and Fair Trading Commission (CFTC) will investigate reports of anti-competitive practices along the distribution chain, such as alleged hoarding and speculative pricing.
CFTC spokesperson Innocent Helema was not immediately available for comment, but in an earlier interview he said an investigation to establish the level of competition and consumer protection in the business was vital.
Malawi has three cement producers, namely Shayona based in Kasungu, Cement Products Limited in Mangochi and Portland Cement Malawi in Blantyre.
The three companies have a production capacity of 822 012 metric tonnes (MT) against an annual market demand of 1 782 000MT.
