Cement prices up 23% year-on-year

Cement price, one of the key construction materials, went up around 23 per cent in October, compared to the same period last year.

Manufacturers say the dollar crisis, hiked raw material prices and production and transportation costs have led to the increased rates, even though the price of a 50kg local cement bag fell by Tk 70-80 in the last week of November compared to last month across the country.

According to the latest Bangladesh Bureau of Statistics (BBS) data, cement prices in the retail market increased by 22.73 per cent in October this year compared to the last corresponding period.

The data showed that the price was Tk 550 on average in October this year, which was Tk 448.13 in October last year. It also showed the price was Tk 463.09 in FY22. It was Tk 447.62 in FY21.

However, the real picture is different than the BBS data as cement bags are sold at higher price in the retail market.

A visit to the retail markets in Dhaka showed that a 50kg cement bag was sold between Tk500-560 on Monday.

Md Aman Ullah, the proprietor of Anika Enterprise at Old Dhaka, said he was selling Holcim and Scan cement at Tk 560; Crown, Akij, SuperCrete, Fresh, Shah and Premier cement at Tk 520-530; and Metrocem and Bashundhara cement at Tk 500.

“In August and September this year, we sold a bag between Tk 600-650. The price dropped a little this month but we think the rates may increase further next year,” he said.

He also pointed out that the price had increased by at least Tk 100 per 50kg cement bag in recent times compared to last year.

Talking to The Business Post, Crown Cement Company Secretary Md Mozharul Islam said cement prices have gone up because of the dollar rate abnormality, rising raw material prices, and increasing production and carrying costs.

“Our cement market depends on the international market because we have to import all raw materials from different countries. The cement companies won’t sustain if prices do not go up,” he said.

Metrocem Cement Ltd Managing Director Md Shahidullah said Bangladesh has to import all five raw materials — clinker, limestone, slag, fly ash and gypsum — to produce cement.

“The price here has gone up due to the rising prices of raw materials and transportation costs in the international market. However, the price went down recently compared to the last several months’ thanks to a bit of normalcy in the global market,” he added.

According to Bangladesh Cement Manufacturers Association (BCMA), there are 76 large, medium and small cement manufacturing companies registered in the country. Forty-two are currently in operation and seven of them are listed with the share market.

Currently, these 42 companies have a total yearly effective capacity of about 58 million tonnes against the demand of approximately 31 million tonnes.

Of the 42, the cement industry is dominated by only 10 companies, including two multinationals, holding around 75 per cent of the total market share, according to BCMA.

BCMA projection says that per capita cement consumption will stand at 250kg in 2022. The industry employs around 60,000 people directly and 5 million people indirectly.