The government of Malaysia has approved a 10% increase in the price of cement, the first rise in more than a decade, an industry executive said Friday.
His comments sent shares of cement makers sharply higher.
The executive told Dow Jones Newswires that the government has approved the sale of cement at MYR218 a metric ton from the current MYR198 a ton, which was set in 1995.
The government sets the ceiling price for many sensitive items such as cement, sugar, flour and petroleum. This year, the government has raised prices of electricity and petrol as well as highway tolls.
The Cement & Concrete Association of Malaysia - an industry group - said it will issue a statement after 0900 GMT and declined to comment further.
Lafarge Malayan Cement Bhd. (3794.KU), the biggest cement maker with an estimated 44% market share, has indicated it will raise cement prices from Saturday, the industry executive added.
Analysts said the cement makers had asked for a 20% increase in May, citing higher electricity and coal costs as well as inflationary pressures.
A building material analyst with a foreign research house, who declined to be named, said the price increase could make building bridges and roads 5%-10% more expensive. The move could also hurt sentiment in the laggard property market, he said.