An increase in the price of cement of late has dealt a severe blow to the consumers across the State. The dealers too have been badly affected by the ₹40 hike in the last one week.
Dealers and consumers said that a one-time increase of ₹40 was unprecedented in cement price. Cement companies and the State’s failure to set up a price regulatory body have been blamed for the recent price increase.
Till last week, cement was available in the State for ₹355 to ₹360 a bag. Since Tuesday, it has been priced at ₹395-₹400.
When Ramco and Shankar cement is available for ₹395 to ₹400, ACC, Ultratek and Ambuja cement is sold for ₹405. Chettinad, Zuari and Bharati cement is available for ₹390.
During the monsoon, cement sale in the State usually witnesses a 20% dip because of rains. The price increase during this off-season has badly hit the dealers.
“Apart from the consumers, we too are badly affected. Dealers are struggling to pay wages to their staff during this festival season,” said Sirajuddeen Illathodi, State secretary of the Kerala State Cement Dealers Welfare Association.
Artificial demand
With the increased prices, cement companies have been blamed for reducing the product supply, and thus creating an artificial demand. “It’s a unilateral and arbitrary increase. An increase of ₹10 or 15 could have been understood. But this is too much. We want the government to intervene,” said Mr. Sirajuddeen.
Malabar Cements, the only public sector cement manufacturer in the State, is unable to tackle the price increase by the cement cartel.
Having a production capability of 40,000 tonne a month, Malabar Cements enjoys only five per cent stake in Kerala market.
Although Malabar Cement is available for ₹350 a bag, an unimpressive marketing policy this public sector unit makes it a poor contender for a slot.
Although there were demands for setting up of regulatory body to control the price, the State government is yet to wake up to it. “We are going to meet the Chief Minister on Monday to press this demand,” said Mr. Sirajuddeen.
Kerala has been maintaining a monthly demand for eight lakh tonnes of cement. The 1.6 crore cement bag movement has been producing a ₹560 crore business a month in Kerala.
When the government benefits from higher taxes from the increased price, consumers and dealers are at the receiving end.
