The UAE will not heed calls by dealers to intervene in stopping a decline in cement prices on the grounds they must be determined by the market, a senior economy official said in remarks published on Thursday.
Mohammed Al Shehi, ministry of economy undersecretary, said the ministry would intervene only in case of manipulations or other illegal practices that will harm the interests of dealers and consumers.
Shehi, quoted by the Dubai-based Arabic language daily Emirat Alyoum, was reacting to calls by suppliers on the ministry to intervene in lifting cement prices following a steep decline over the past period because of a downturn in the construction sector and a fall in public infrastructure projects.
“The ministry’s strategy is that cement prices should be left to be determined by market conditions, including supply and demand…we will not intervene in setting its prices as long as there are no reasons justifying intervention,” he said.
“So far, there is not evidence of any manipulation or dumping in the market…we have not seen any illegal practices that justify our intervention.”
Shehi warned that interference by the ministry to push cement prices back up could result in a “sharp and illogical” increase that will destabilise the market.
Emirat Alyoum quoted dealers as saying prices have dropped to one of their lowest levels of AED12.75-13.50/bag (US$3.5-3.7) although the ministry of economy have previously set them at AED18/bag (US$5).