Santo Domingo.- The jump as high as 30 pesos on the price for a bag of cement stems from the control which one of the six manufacturers has over the association which groups them, Dominican Chamber of Construction (Cadocon ) president Diego de Moya affirmed Thursday.
"The company Cemex controls the Dominican Cement Producers Association (Adocem) and therefore applies price increases wherever and whenever it pleases without control," the business leader said.
"I tell it like it is. And that’s basically an association managed by Cemex and it’s doing what Cemex wants here. That's a disaster, because without control and every time they want, increases cement in Dominican Republic, led by Cemex," the annoyed executive said.
De Moya’s affirmation comes one day after Housing Builders and Developers Association (ACOPROVI) president Femin Acosta called "suspicious that the bag of cement rose around 10% to welcome the administration which takes office August 16."
Hardware Dealers Association president Domingo Diaz also agrees with those who’ve complained of higher cement cost. "It’s certainly a rise which won’t sit well with the next government just starting, and manufacturers, instead of promoting this disproportionate increase, they’ve should’ve conducted an analysis (to realize) that it isn’t consistent with the country’s current reality."
Newspaper El Caribe reports that prices varied yesterday among companies in the in the industry, from 320 to 330 pesos per bag, jumping from RD$295 just a few days ago.
But Adocem executive director Julissa Baez justifies the increase, calling it an adjustment of cement prices from earlier this year, adding that it’s a decision by each manufacturer, and doesn’t involve the Association, which in addition to Cemex, groups Cementos Colon, Domicem, Cementos Cibao, Cementos Andino and Cemento Santo Domingo.
It’s the coke, not the crude
In a statement, Adocem noted that though the price of oil has dropped, the fuel for cement furnaces, called coke, has jumped from US$40.0 the ton earlier this year to US$140.0 today.
"I don’t want to comment on the rise in fuel Adocem says they use. If that’s so I’ll admit they’re right, but I don’t believe Cemex much, because they increase prices often," de Moya said.
Cemex denies “manipulation”
Cemex called the allegation it manipulates cement prices unfounded and affirms that its actions comply strictly with the law.
It said its more than 17 years in the country, and over one century globally is proof of that, which has led it to become the local market’s leader and among the world’s top producers.
"Cemex recognizes and supports the Government’s right to promote free competition and open markets, through full and strict enforcement of antitrust laws. For these reasons it categorically rejects public statements voiced in that regard."
In a statement to DT, the Mexico based company said Dominican Republic’s is a competitive market where prices are set by the dynamics of supply and demand, and a local cement industry with the largest number of competitors and at 6.2 million tons per year, the hemisphere’s highest installed capacity per capita. “In the last three years the behavior of the company’s cement prices have been kept relatively stable, with an annual average growth similar to inflation.”
“Finally, it’s Cemex’s wish that the statements made on the issue at hand be characterized by the seriousness and respect it merits, to avoid confusions with possible problems among individuals.”