Cement, steel rod prices go up after elections

Published On: December 29, 2017 02:00 AM NPT By: Santosh Neupane  | @santyneupane

KATHMANDU, Dec 29: Cement producers have increased the price of cement by at least Rs 100 per sack (50 kg), citing a rise in demand for cement after the parliamentary and provincial elections. 

The price of steel rod, which also widely used in the construction of houses and other infrastructure, has also gone up by Rs 5 per kilogram. “

"Cement prices, as well as truck fares, have increased significantly over the past 10 days," said Shree Krishna Rijal, president of Nepal Construction Material Dealers Association“ "There is no concrete reason for the hike in cement prices. Industrialists have hiked the prices even twice a day like that of bullion market."

Industrialists usually raise the price of construction materials when winter -- the peak season for construction activities -- approaches. This time the problem in import of clinkers has favored them.

A retailer told Republica that the prices have increased by Rs 30 per sack in comparison to the last year. He requested for anonymity.

According to retailers, the price of OPC and PPC cement has been increased by up to Rs 100 and Rs 80 per sack, respectively. Price of OPC cement, which was around Rs 850 per sack last year, now stands at Rs 950 per sack. OPC cement of reputed brands are being sold at up to Rs 980. 

Similarly, PPC cement saw a price rise of Rs 100 per sack. PPC cement is now available at Rs 800 to Rs 830 per sack depending on brands.“

"Cement manufacturers have pointed out a problem in the import of clinker as the main reason for the price rise," Rijal said, adding "It is strange that such a small problem has immediately made impact in cement prices in the market."

Moreover, transporters have also increased the charge of carrying cement. Rijal said that truck owners have increased the cost of transporting a sack of cement by up to Rs 30. According to retailers, truck owners have increased the charge as per their will without any concrete reason.

Steel rod, which is also an essential component in construction, has also become dearer. The price of a kilogram of steel has increased by up to Rs 5 over the past 10 days. Retailers said that there is no basis for price hike as the country is self-sufficient on steel rods. 

Dhruba Thapa, president of Nepal Cement Manufacturers' Association (NCMA), however, said that manufacturers have not increased the price“. "Price can fluctuate with the seasons even if the manufacturers do not make any increment," said, adding“, "We have not officially increased cement prices. Seasonal variation could have occurred in this case."

Thapa further added that cement industries could also be shut down because of the problems in import of coal and clinker from India. 

India has said that it would stop unloading dusty cargo like clinker at Raxaul due to protest by locals. It has decided to unload such cargo at the dry port.

Thapa also said that India has hiked the price of coal “. "We are facing hurdles in import of clinker. Also, the price of coal has increased," he added.

About 30 percent of clinker needed for cement production in Nepal is imported from India. Cement manufacturers using locally produced clinker have also increased prices.
Pashupati Murarka, former president of Federation of Nepalese Chambers of Commerce and Industry (FNCCI), told Republica that that cement prices have increased by six to 10 percent due to obstruction in the import of clinker“. "Long-term problem in clinker import is the main reason behind the surge in cement prices. Despite our repeated request, the government is not taking any initiative to resolve the issue. This has put the cement industries in trouble," added Murarka.

Though cement manufacturers have said that clinker can be imported from other border points like Biratnagar and Bhairahawa, the government is not taken any step in this direction.

Retailers also said that there is no concrete reason for manufacturers to increase cement prices at the moment. They also alleged that cement manufacturers were taking advantage of the weak government.

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