Nepal | May 22, 2019

Producers raise cement price due to clinker crunch

Cost of OPC and PPC cement has been hiked by up to Rs 115 per sack

Himalayan News Service

Kathmandu, May 4

Price of cement — a major construction material — has soared significantly in domestic market over the last one-month period.

Seizing the opportunity of rapid reconstruction works taking place across the country, cement manufacturers have increased price of cement by more than Rs 100 per sack (50 kg) within last one month.

Despite their commitment to government not to hike price of cement, manufacturers have increased price of Ordinary Portland Cement (OPC) by Rs 105 to Rs 915 per sack. Also, price of Portland Pozzolana Cement (PPC) has been raised by Rs 115 per sack to Rs 815.

Three weeks ago, cement manufacturers had expressed their commitment to Industry Minister Nabindra Raj Joshi not to increase price of cement.

Officials of Nepal Nirman Samagri Byapar Sang (NNSBS) have said that manufactures are increasing cement price unnecessarily due to the lack of a state mechanism to fix the price.

“Manufacturers have already increased cement price twice in the last one month. Such increment in price at a time when demand for cement has increased manifolds might even affect the construction and reconstruction activities in the country,” Dipak Shrestha, vice-president of NNSBS, said.

Meanwhile, manufacturers have said recent deficit and surge in price of clinker and coal — two major ingredients for cement production — have compelled manufactures to hike price of cement.

“Cement factories are currently facing scarcity of clinker as supply from India has been halted since almost one month,” Tara Pokharel, general secretary of Cement Manufacturers Association of Nepal, said, adding that 35 per cent of domestic demand of clinker is fulfilled by imports from India.

As per Pokharel, Indian traders are facing crunch of railway racks to supply adequate quantity of clinker and coal to Nepali traders, which has resulted in reduced supply of Indian clinker and coal in the domestic market.

“Due to the supply constraint of coal from India, event domestic clinker producers have reduced the production of clinker,” added Pokharel. He said cement manufacturers are currently producing only half of their total production capacity due to clinker crunch.

However, manufacturers claim that they have increased cement price by only Rs 30 to Rs 40 per sack. They added that the current increment in price of cement is of temporary nature and will come down within a few months.


A version of this article appears in print on May 05, 2017 of The Himalayan Times.


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