House comittee to hold inquiry on cement pricing

The House committee on trade and industry holds an inquiry today on the alleged cartelized pricing scheme of local cement companies, raising curiosity in the business community on the real motive of the solons behind this move.

For instance, an industry source said cement companies have long complained of the dumping (selling at atrociously low price) here of cement products from Taiwan and Japan, yet none of the members of this House committee has taken notice of this problem which gravely endangers the viability of the entire Philippine cement industry.

The House committee initiated the inquiry on the proposal of Rep. Joey Sarte Salceda (LAMP, Albay) who accused domestic cement companies of operating like a cartel in raising their prices.

Salceda and company, however, ignored the plight of Philippine cement companies which have suffered huge losses due to unhampered importation and sale in the country of Taiwanese and Japanese cement at "dumped prices," a cement industry executive said.

The Taiwanese-owned TCC Cement Corp. and the Japanese-controlled Southern Cross Cement are behind the cement dumping. The firms reportedly enjoy the backing of middle-line officials of the Department of Trade and Industry (DTI). Available data show that ex-plant prices of cement in Taiwan average $65 per metric ton, and in Japan the average is $70 a ton, but their products are sold here at an average of only $20-$21 a ton, in clear violation of the country's anti-dumping laws.

Cement companies had earlier explained to Trade and Industry Secretary Mar Roxas that they raised their prices at an average of P8-P13 per bag to curb their losses which have racked up to P9.2 billion in the last two years. Local cement prices of P80-P85/bag however are still below their pre-Asian crisis level of P130-P160/bag.

They blamed their losses on the unhampered dumping in the country of cement products by Taiwanese and Japanese companies, which local cement industry officials claimed are out to push Philippine companies out of business and their employees out of work.

The Philippine Cement Manufacturers Corp. (Philcemcor) has filed with the DTI a formal protest to counter the "predatory pricing scheme" of the two foreign cement distributors.

It plans to elevate its complaint against TCC and Southern Cement to the Tariff Commission soon.