Findings on cement overpricing out shortly. Philippines

Findings on cement overpricing out shortly. Philippines
10 April 2007

The Department of Trade and Industry is set to release within the next few days its findings on alleged overpricing of cement by local producers.

Trade Secretary Peter Favila said the department had drawn up a chart plotting the prices imposed individually by local cement producers against their separate production cost.

“After the Holy Week, we will determine if they are really overpricing,” he told reporters in a briefing before the Lenten break.

Favila, in an earlier meeting with the top officials of the local units of Cemex SA of Mexico, Holcim of Switzerland and Lafarge of France, asked them to submit their individual production cost and factory prices. The three foreign cement companies account for a majority of the supply of the commodity in the Philippines.

He said the three companies had submitted a bundled presentation showing industry figures as a whole. Favila, however, asked them instead to present individual reports, which would serve as the basis for the trade department in determining whether there was overpricing on cement.

Trade Undersecretary Zenaida Maglaya earlier said the department and the Board of Investments would review cement production costs to determine if prices imposed by producers and margins were reasonable.

While it “does not make good economic sense to impose price controls,” Favila said, the trade department was weighing the possibility of setting a certain percentage of margins that cement producers could impose in pricing their products.
Published under Cement News