Domestic cement manufacturers claimed that price suppression from imported cement has prevented them from recovering additional logistics cost.
In a statement on the recent definitive safeguard duty hearing by the Tariff Commission on imported cement, the Republic Cement President John Reinier Dizon explained that the increased production cost from 2022 to 2023 was primarily due to the company’s initiative to increase delivered sales, aimed at ensuring the safety of products. The Commission is determining whether or not to impose a definitive safeguard duty on cement imported beyond the provisional 200 day safeguard duty.
Dizon, who is also president of Cement Manufacturers Association of the Philippines (CeMAP), they were unable to recover these additional logistics costs due to price suppression caused by imports. “While we advocated for safer and more reliable delivery method, the influx of low-priced imports prevented us from fully selling, passing on these costs to the market,” Dizon said.
Local cement manufacturers even claimed that their expansion programs and initiatives are primarily aimed at staying competitive in light of the surge in imports.
In the same hearing, the Strategy Manager of Holcim Philippines was asked to confirm whether the company posted a PHP1-billion profit during the nine-month period from January to September 2023.
Ms. Maria Isabel Cleto, Holcim strategy manager, acknowledged that the company did record the said profit. However, she emphasized the importance of examining year-on-year trends and the overall bottom line. “Our EBIT also showed a declining trend over the POI because of the surge of imports affecting our sales volume” Cleto stated.
During the same hearing, Trizia Mistica, industry manager of Concreat Holdings Philippines, was asked whether their expansion plans were merely a continuation of previous initiatives—implying that these would have proceeded regardless of import competition. In response, Mistica firmly clarified that the company’s current efforts are directly driven by the challenges posed by imports. “We are undertaking these measures to address our main concern, which is the surge of imported products,” she emphasized.
CeMAP also reiterated that the Tariff Commission’s own Staff Report confirmed an 8 percent cumulative aggregate growth in cement imports during the period of investigation. “This surge has placed considerable pressure on local manufacturers, many of whom have invested heavily in expanding capacity and improving sustainability practices,” CeMAP added.
Due to the influx of imports, CeMAP emphasized that the local industry has more than enough capacity to meet national demand.
Total installed capacity now stands at 51 million metric tons, following new capacity
additions by both CeMAP and non-CeMAP members over the past two years, the group said.
Notably, Solid Cement Corporation invested in an additional 1.5 million metric tons of capacity and recently commissioned. Meanwhile, Taiheiyo Cement with its new line increased its capacity by 3 million metric tons per annum.
Despite these expansions, capacity utilization is currently only at 53 percent, indicating significant underuse of local production capabilities.
This low capacity utilization is allegedly caused by the influx of imports, according to CeMAP pointed out.
