DTI seeks public input on cement safeguards probe

MANILA, Philippines — The Department of Trade and Industry (DTI) is seeking inputs from interested parties as it is set to start its probe on whether safeguard measures should be imposed on cement imports.

In a notice posted on its website on Oct. 31, DTI said it will initiate, motu proprio, a preliminary investigation to determine if increased cement imports are causing serious injury to the domestic industry and if safeguard measures should be imposed.

Under Republic 8800 or the Safeguard Measures Act, the country may impose a  safeguard measure like increased tariff on certain imports to provide relief to the domestic industry when there is serious threat or injury caused by a surge in imports of like products.

 The same law provides that the trade secretary may launch a preliminary safeguard investigation, if there is evidence that increased imports of the product under consideration are a substantial cause of or are threatening to bring serious injury to the local industry.

“Interested parties are invited to submit their comments and position on the matter including their views on whether the imposition of a safeguard measure is in the public interest,” the DTI said.

Comments and position papers will have to be submitted to the DTI Bureau of Import Services within five days from the publication of the notice.

The DTI is conducting a preliminary probe on the possible imposition of safeguard measures as cement imports continuously increased from 2019 to 2023.

In particular, cement imports went up from 5.33 million metric tons (MT) in 2019 to 5.88 million MT in 2020 and rose further to 6.89 million MT in 2021.

While cement imports went down to 6.70 million MT in 2022 from 2021, it increased to 7.01 million MT in 2023.

For this year, cement imports are projected to go up and reach 7.36 million MT.

The DTI also said a review of evidence made available to the agency showed the domestic industry suffered serious injury caused by increased imports as its share in the market showed a declining trend from 78 percent in 2019 to 68 percent in 2023 and 66 percent in the January to June period of this year.

Revenues of the local cement industry also dropped from P79 billion in 2019 to P64 billion in 2023.

The DTI said operating profit of the domestic cement industry dipped by 11 percent in 2020, increased by 12 percent in 2021, dropped significantly by 69 percent in 2022 and declined further by 137 percent, recording an operating loss last year.

As the weighted average landed cost of imports is lower than the average selling price of locally made cement, the DTI said there is also an indication of price undercutting.

To compete with the lower-priced cement imports, the DTI said cement manufacturers in the country have been forced to bring down prices by two percent.

To promote public interest, the DTI will consider whether imposing the provisional measure could lead to a political and economic crisis and whether it might cause a shortage of cement in the domestic market.