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Thursday, May 22, 2008

Malaysia to open up cement market

The government has decided to open up the cement market, just like it had for steel bars, said Domestic Trade and Consumer Affairs Minister Datuk Shahrir Samad.

"For steel bars and cement, it does not seem right that price controls should be set at a level that is not reflective of the cost and market price," he said.

However, he declined to say when this would take effect for the cement industry.

Similar to the steel industry, local builders complain that cement is being sold to them above the ceiling price.

Producers argue that the extra charges include transport costs.

The government opened up the steel bar and billet market on May 12.

Cement is still being sold at RM219 per tonne in Pahang, Selangor, Malacca, Negri Sembilan, Kuala Lumpur and Putrajaya.

In Johor, however, cement costs RM224 a tonne. In Perlis, Kedah, Penang and Perak, it is priced at RM217 a tonne. But in Terengganu and Kelantan, it is sold at RM233.

Cement producers via the Cement & Concrete Association of Malaysia (C&CA) had put forward a few proposals to the government.

They requested that the government raise the ceiling prices for cement by 10 per cent.

There was also a recommendation for an automated price mechanism based on an index that incorporates pricing of coal, electricity and diesel, the main costs to manufacture cement.

By New Straits Times (by Ooi Tee Ching)

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