Nepal cement prices fall

Nepal cement prices fall
Published: 08 September 2009

The prices of bricks and sand, two major construction materials, have soared sharply in the market, as manufacturers and suppliers increased prices citing shortfall in supply. However, the prices of cement and steel rods have gone down, easing the overall cost of construction.

Retailers said the price of bricks have soared 25 per cent over the last couple of weeks and gone as high as Rs 10,000 per thousand units. Even the low grade bricks presently cost Rs 8,000 per 10,000 units. The new rate is more than twice the price in the market a year ago.

Likewise, the price of sand has increased to Rs 50 per cubic feet from Rs 21 about a month ago. Manufacturers and suppliers have attributed the rise in prices to damages of raw bricks and rapid depletion of stock and also the short supply of sand during rainy season.

However, contractors have tagged the new prices as ´unfair´ and a move of the manufacturers to extort higher profits. “It is a clear case of collective price fixing by the manufacturers and suppliers,” Roshan Dahal, a contractor, told myrepublica.com.

Despite the rise in price of bricks, Dahal noted that the overall cost of construction has presently gone down because the prices of cement and steel rods that occupy lion´s share in overall construction have dropped in recent weeks. For instance, the price of Nepali cement in the market has dropped to Rs 580 per sack (50 kilograms). The rate is inclusive of value added tax. Till a month ago, cement was priced at Rs 700 per sack. Unlike in the past, the price of Indian cement is currently priced higher than Nepali cement in the market. Indian cement is presently sold in the market at about Rs 650 per sack.

Retailers attributed this difference in prices to the recent changes in taxes and also the dwindling supplies. Since cement occupies some 29 percent weight in overall construction budget, Dahal noted that the drop in its prices have come as a relief to the customers planning new constructions.

The price of aggregates, which also occupies substantial weight on the construction cost, has remained unchanged at about Rs 42 per cubic feet over the past one month.

Source: Republica Business and Economy