Zimbabwe News and Internet Radio

PPC sweats over imports. . .Cement producer appeals for intervention

By Oliver Kazunga

The country’s largest cement producer, Pretoria Portland Cement (PPC) Zimbabwe is feeling the heat from imports and has called on Government to promulgate protectionist laws to promote local production.

Pretoria Portland Cement (PPC) Zimbabwe
Pretoria Portland Cement (PPC) Zimbabwe

Government lifted a two- year import ban on some basic commodities including cement last October as a measure to deal with rampant shortages that drove public into panic buying.

Cement was among the products in short supply despite insistence of adequate capacity by local producers.

PPC Zimbabwe managing director, Mr Kelibone Masiyane, has said their competitiveness has largely been affected by the opening of borders.

“What really has rendered us uncompetitive initially was the opening of the flood gates and then pricing became another issue.

“Definitely the price of imported cement is much lower than ours and we cannot compete because of high cost of production,” he said.

At the PPC Zimbabwe factory in Bulawayo, a minimum of 100 bags of cement are being sold at RTGS$30 each or US$7,50.

A snap survey carried out by Business Chronicle in Bulawayo has shown that most of the hardware shops do not have imported cement but locally produced cement, which is selling for between RTGS$28 and RTGS$36 per 50kg.

The price in US$ ranges between US$6,50 and US$8 or R120.

“We are coming from a point where we aren’t looking for a complete ban but what we are saying is we want to get to a level playing field so that people can choose cement type depending on quality. We believe we have got the best quality and we believe that is how we should be competing,” he said.

Mr Masiyane briefed Industry and Commerce Minister Nqobizitha Ndlovu about the issue during a recent tour of the company’s factory in Bulawayo.

He told the minister that at present his company has more than enough stocks of cement at its warehouses. In his response Minister Ndlovu said:

“I want to agree with you and leave a challenge, which l left with you the other time. At this point it won’t make much sense for me to push for protection unless we are satisfied that you can supply the market.

“I’m still not convinced and am told by people that they are failing to buy cement because it is in short supply. I am sure you know it”.

Minister Ndlovu said he was quite concerned about the cement sector and wanted it protected because the country was moving towards infrastructure development.

Against this background, he said protection of the cement sector has to lead to tangible results and, thus, Government and manufacturers needed to agree on strategies that need to be adopted to improve competitiveness locally produced cement.

Minister Ndlovu said he was pleased to note that PPC Zimbabwe as a leading cement manufacturer, had dealt with issues of packaging and also clinker, which was being transported from Colleen Bawn in Matabeleland South province to the Bulawayo plant.

“All these issues and power supply are tangible programmes meant to improve competitiveness and also as Government you need to tell us where we should consider adjustments,” he said.

On the pricing issue, he said this would not be addressed unless and until the supply constraint in the market was addressed adding that there were people who wanted to take advantage of the situation and benefit from arbitrage opportunities.

Minister Ndlovu said in Plumtree where he hails from, people were not able to buy cement in local currency.

Mr Masiyane said there were special prices for border towns meant to discourage imports.

“We have applied what we call a ‘border strategy’ Plumtree and Beitbridge and I think now we are moving to Victoria Falls. The idea is to discourage people who live especially around the border towns from going across to buy cement hence the special prices which are attractive. An individual has to take into account the troubles of crossing the border and then transporting it back and in some instances paying duty,” he said. The Chronicle