Distribution difficulties push up cement prices in Colombia

Distribution difficulties push up cement prices in Colombia
Published: 27 May 2011

Colombian cement retail prices have increased by about 10% above the expected level of inflation as winter rains affected distribution.

Earlier this year, prices were adjusted by 6% and in the past few days, Holcim, Cemex and Argos, which account for 95% of the market, raised them an addition 4%.

According to Miguel Ángel Rubalcava, president of Holcim Colombia, the cost of transporting cement to distributors and concrete plants has risen by around 15% due to the diversions caused by road infrastructure affected by the rain. The companies have to some extent absorbed the costs, but eventually needed to raise their price to protect profit margins.

Holcim’s plant in Chia, where night-time movement restrictions have been in place due to the flooding by the Bogotá River, has cut production by around 30% with the shortage being met by units south of Bogotá.