Zimbabwe: cement price hike short lived

Zimbabwe: cement price hike short lived
Published: 19 October 2011

A temporary shortage of cement following a fault at the country’s largest cement factory gave some shopkeepers who had stocks the opportunity to raise cement prices and push the profit margin into the upper atmosphere.

A 50kg bag that should sell for between US$12,50 and US$13 suddenly was on sale for well over US$20. Some of those stocks had even been bought from reputable dealers at normal prices, not to use but for resale.This made the shortage even worse.

Many retailers sensibly organised cement imports, but thanks to the duty imposed at Chirundu and the extra cost of transport this made the cement price more expensive than local cement made in Harare. Local press report that decision to import might have been, in retrospect, a bad business call, but some of those who made it should be considered honest.

Lafarge is now making more than 1000tpd of cement, having brought its factory back into production, so the pent up demand for a reasonably-priced product will soon be satisfied.

Zimbabweans have been told that because of the currency reforms, the country simply does not have permanent product shortages any more. If the local supplier cannot cope, cement can easily be imported.