Trade Minister: No support for cement $$ hike

Trade Minister Paula Gopee-Scoon has said the government does not support Trinidad Cement Ltd's (TCL) latest proposed price hike and is calling for more suppliers in the market.

She said increasing cement prices had been a challenge for the government over the past few years and remained a hot topic. If the price hike is implemented, it will mark the fifth price increase since December 2021by TCL.

"At the Trade Ministry, we're not happy," she said.

On February 6, the Contractors Association (TTCA) announced a price hike for cement, effective February 17 for retail users and March 5 for bulk users. The association said the increase will affect the overall cost of construction.

TTCA president Glenn Mahabirsingh said a cement price increase is expected for retail users by February 17 and for bulk users by March 5, and would increase the overall cost of construction.

Speaking during a tour of Creamery Novelties at the Diamond Vale Industrial Estate in Diego Martin on February 18, Gopee-Scoon said she had been in discussions with TCL.

"The government will not countenance the continued increases by TCL in the marketplace."

She said two main concerns of the government are the consumer and the industry. Gopee-Scoon said her ministry wants to ensure the industry remains viable.

There are 500 direct employees at TCL and another 1,500 indirect employees. Our priority in the last five-six years was to ensure business stayed in TT and businesses remained operational.

The second priority is quality cement, which has always been a matter of concern for the government.

"One only has to look at the disastrous effects of earthquakes in other parts of the world and ask if the loss of property and lives was the result of questionable cement."

She said TT has in place a compulsory standard for cement, which the government intends to abide by as it tries to open the market again.

Gopee-Scoon said her ministry has been working on reducing the Common External Tariff (CET), and her ministry has gone before the Caricom to reduce the CET from 50 per cent to ten per cent over time.

"We're looking at all sides. We are in discussions, we've spoken with TCL, and we've also spoken with the Contractors Association."

Gopee-Scoon said the government “understands the impact the price increase will have on the market” and will make “some kind of decision" shortly.

She stressed the government is keeping in mind the balanced interests of both the consumer and the industry so both can survive.

"We're anxious to have other players coming into the market. I don't want to say too much about that; we know some entities are looking. Although we are anxious for other players, we want to ensure they too abide by the compulsory standard."

She stressed that her ministry insists on the quality of cement brought into the country, as well as ensuring all environmental requirements are met.

Asked if the ministry has data to suggest the price increases are unjustified, she said a look back at the prices, along with a close examination of the industry's viability, shows the industry is back.

"We have to take inflation into consideration, but it's probably where it was before. Still, in the interest of the consumer, we would like to see better prices for cement. That's what we're working on. We believe new market entrants are needed."

In a November 1 release, TCL reported $210.6 million in profits after tax in its condensed consolidated interim financial report for the year ending September 30.

The results represent a significant increase in profits as compared to the same period the year before, when it garnered $169.2 million. The company earned $170.1 million in after-tax profits in 2023.

Gopee-Scoon expressed hope that cement prices would improve in the coming years, but stressed her ministry's focus is also on quality and ensuring jobs are not lost.

"Jobs are important and the process of finding other suppliers has already started. It remains for the private sector to see the opportunity and intervene: not just the local private sector, but external players too."

She said the government hopes TT CET is attractive enough for new investment and new players in the market.

Gopee-Scoon concluded, “As a cabinet member, as a ministry responsible for the industry, we take this seriously. We are addressing this and seriously looking at all possible actions to ensure that there’s a balance, as we want to see prices go down.”

Rock Hard Distribution Inc, which operated in TT for five years, withdrew from the market on September 17, 2021, after legal disputes with the government.

A TCL spokesperson told Newsday the company was encouraged by Gopee-Scoon's concerns about the importance of local industries and the jobs of direct and indirect workers.

"TCL remains fully committed to its socio-economic responsibilities, mindful of the company's significant role in the construction sector and to delivering a reliable supply of high-quality cement as needed to support the country's growth," the spokesperson said.