One local contractor does not believe the increase in cement prices from one local supplier will have significant negative impacts on the construction sector.
NH International executive chairman Emile Elias said the new prices of Rock Hard Distributors Ltd posed no threats to the cement supply and Trinidad Cement Ltd (TCL) can fill the gaps.
He told Newsday on Thursday, “There is nothing that Rock Hard cement either does or can do that will impact on the local construction sector. They are a peripheral player and some of the allegations they made against the government are simply not true."
In January this year, Rock Hard said it was not able to supply the commodity after government imposed “crippling restrictions that have adversely affected our company.”
The restrictions were published in the Ministry of Trade’s Legal Order 415 and 416 of the Customs Act, Chap 78:01 introduction of a quota, import licensing regime and registration system for building cement – grey and other hydraulic cement. This went into effect on January 1.
The ministry said the new system would be in place for three years. It also implemented a maximum quota of 75,000 tonnes of cement to be imported. It said people who wished to do so must be registered first with the Trade Licensing Unit at the ministry.
The original tariff was zero per cent, which the government then increased to five per cent and in 2020 to 35 per cent.
Rock Hard Distributors Ltd has since challenged the quota on imported cement and a proposal to increase import duties.
A hearing of the judicial review has been set for February 25.
The company also challenged the government’s proposal to the Commission for Trade and Economic Development (COTED) for a further suspension of the Common External Tariff (CET) on other hydraulic cements and its intent to apply a 50 per cent duty. That matter was referred to the Caribbean Court of Justice (CCJ).
Elias said TCL had sufficient resources to supply demand for the commodity, which provided foreign exchange, because of its reach in the region.
“We have a local cement factory that uses 95 per cent of its input for locals, exporting and earning foreign exchange. I support local industries and will not buy Rock Hard or hard rock or whatever it is called.
“I hope they lose their case. I think the government has been very lenient for a long time and I think that the local construction sector should strongly support the local factory that uses 95 per cent local materials to generate local products.”
Elias added that TCL had a huge excess capacity which makes it adequately able to supply the markets with high quality cement.
“We do not know what comes across the ocean and the age of the cement when it is stored before we use it. It (Rock Hard) is being imported from Turkey and it could be old by the time a customer uses it.
“Disguising the importing from St Lucia to evade taxes or avoid taxes is another matter. The government enjoys no tax revenues from this,” he said.
Elias also believed that retail consumers would not be affected.
But president of the contractors’ association Glenn Mahabirsingh said the sector cannot afford another price increase.
In a WhatsApp message on Thursday afternoon he said it had already been hit hard with price increases in steel and other increases posed serious risks.
Mahabirsingh said, “With the recent increase in steel prices the industry cannot afford any further increases in the basic raw materials needed to fuel the country 's economic revival through construction.
“We intend to initiate discussions with stakeholders to further ascertain their intentions for the short term.”
He said the association continued to monitor wholesale and retail prices for all building materials.
“At the moment we have not seen the quoted prices being reflected in the market and we remain vigilant in the interests of our members and clients,” Mahabirsingh added
Rock Hard’s managing director Ryan Ramhit said his new wholesale prices to hardware stores was $65.25 VAT inclusive. The previous price was $39. The same price is charged to Tobago purchasers as they provide their own transport. TCL's wholesale price is $45 VAT inclusive.
One hardware owner who wished not to be named said the quality of both cements was good but he would not be able to carry Rock Hard any longer.
He said, “I will not be selling it any more because the retail price would now be $75 per bag. This does not make sense for us, and besides, the customers just cannot afford it. Everything just keeps increasing unnecessarily.”