Increased demand in both domestic and international markets has hiked the price of cement.
Penden Cement Authority Limited (PCAL) increased the price of a bag of cement to Nu 287.50 yesterday from Nu 277.25.
Cement agents in Phuentsholing are complaining that the increase has come as a surprise. “Our customers are unhappy when we give them the new price,” a cement agent said. Another agent said there is a need to explain if the revised rate is due to the increased cost of raw materials and transportation. Agents also said that since the capital they deposited was at the old rate, they should be supplied at the same rate.
However, there are also some agents who have not faced problems with the supply and the revised price. Proprietor of Jungship Cement Agent in Thimphu, Ugyen Penjor said his cement supply resumed from April 11. “We have no problem now,” he said.
Regarding the revised price, Ugyen Penjor said that since the agents take commission, the new price is a problem to the customers more.
Senior general manager for marketing with PCAL office, Pema Wangchen said that such a change was an outcome of their sales committee meeting.
“The demand has increased in markets both domestic and India,” the general manager said. He said 65 percent of PCAL’s production is supplied to the international market and the remaining 35 percent to the domestic market.
Although there is a huge demand in India, Pema Wangchen also explained that PCAL has shifted its supply more to the domestic market. “The increase in price is because of the law of demand,” he said. “If the demand for cement is less, the price falls.”
The price of cement for export has also increased by Nu 17.50 a bag compared to Nu 10.75 a bag for the domestic market.
Meanwhile, most agents said the shortage of cement exists because of limited supply from Dungsam. The Dungsam cement depot did not have cement in Phuentsholing depot yesterday. However, the cement is expected to arrive today, Kuensel learnt.
The increased demand has affected construction companies including government projects in Phuentsholing. A construction in-charge with a government project, Tshering said that the shortage has hampered the construction.
“We don’t get cement from PCAL, Dungsam, and Lhaki,” the in-charge said, explaining that most of the cement is supplied to other major projects and India.
The owner of Bhutan Concrete Bricks in Phuentsholing, Tenzin also said that there is a shortage in the market. “Construction activities in the country has increased,” he said.
Tenzin said that cement manufacturers prefer exporting than supplying to the domestic market because of better prices and consistent buying capacity.
Rajesh Rai | Phuentsholing