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27.03.2007 General News

Cost of cement creates controversy

The increasing cost of cement on the market has generated controversy among manufacturers, distributors and retailers.

Whereas the Ghana Cement (GHACEM) Works Limited and the United Cement Distributors Association have declined complicity in the high cost of cement, retailers contend that the situation is a result of the shortage of the commodity and transportation cost.

In an advertiser's announcement, the management of GHACEM insists that it has not increased the ex-factor price of cement which remains 61,000 cedis in Accra, 61,900 cedis in Cape Coast, 63,000 cedis in Winneba, 63,895 cedis in Koforidua, 64,850 cedis in Hohoe, 66,500 cedis in Kumasi, 68,650 cedis in Sunyani, 74,800 in Tamale, 77,800 cedis in Bolgatanga ad 79,800 cedis in Wa.

However, retailers in Accra are selling the commodity between 75,000 cedis and 90,000 cedis and 100,000 cedis up from 65,000 cedis it was selling at 3 months ago.

According to them, they had to travel long distances before getting their supplies, adding that the increase was to help them to redeem their transportation cost.

A visit to some retail areas at Kaneshie, Odorkor Tipper, Macarthy junction, Mendskrom and on the Abeka Motorway, many of them had run out of the stock.

According to them, it took about one month to get new consignments from distributors, unlike the situation was it prevailed in the past when it took just one week to do so.

Some of them also accused the distributors of favouritism and underhand dealings as a result of the shortage of the commodity.

An official of Atala Limited, distributors of cement, iron rods and nails dismissed the allegation explaining that because the company did not get adequate supplies from the manufacturers, it had become difficult to meet the increasing demand of its customers as frequently as it used in the past.

The UCDA has also refuted the allegation that distributors are the cause of the shortage of cement and the price increases.

The Chairman of the UCDA, Felix Nyarko said that GHACEM had adopted a rationing system which made it impossible for the members to supply a backlog of about 47,000 tonnes since January 16, 2007.

He said most distributors had had to sleep overnight in the open in long queues for delivery.

According to Nyarko, the issue was that GHACEM had complained about clinker imported by the company but which was found to be in bad condition and extremely hard to grind at the mill.

He stated that the allocation and loading system had been divided into three categories to cover government projects, companies and distributors.

Mr Nyarko said the distributors had only eight hours within which their membership of about 210 had to be loaded but noted that sometimes the few trucks which went to load stayed overnight.

Source: Daily Graphic

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