1 month ago
8
Importers have denied reports of a significant increase in cement imports, warning that additional import restrictions could drive up prices for the essential construction material.
In response to the Department of Trade and Industry’s (DTI) motu proprio initiation of preliminary safeguard measures investigation on the importation of cement, several cement traders including Cohaco Merchandizing & Development Corp., Fortem Cement Corp., NGC Land Corp., Pabaza Import and Export Inc., and Philcement Corp., clarified that cement importation volume has been steady from 2019 to mid-2024.
These cement importers have submitted a position paper urging the DTI to halt the investigation launched on Oct. 28 last year, calling it unnecessary and counterproductive to the industry.
According to the importers, cement imports reached 5.33 million metric tons (MMT) in 2019, a figure that rose by 10.3 percent to 5.88 MMT in 2020, then by 17.2 percent to 6.89 MMT in 2021. The traders attributed the surge to the Covid-19 pandemic, which led to restrictions that curtailed domestic production as manufacturers struggled with stringent quarantine measures.
“Cement suppliers, particularly importers, were compelled to increase the volume of imports to meet the demand for cement in the country,” their position paper read.
However, with restrictions easing, local cement producers quickly resumed operations, leading to a 2.9 percent decrease in imports to 6.69 MMT in 2022. Imports then saw a modest rise of 4.7 percent to 7.01 MMT in 2023.
Projections for 2024 indicate imports will reach 7.36 MMT, marking a slight 4.9 percent hike. The importers argue that this increase does not meet the threshold for safeguard measures under World Trade Organization (WTO) standards.
Despite acknowledging the increase in cement imports, the traders argue that the figures do not reflect the amount of imported cement actually sold in the Philippines. Some of the imported cement is used as raw material in the production of locally manufactured cement, meaning the surge in imports may not be as significant as reported.
Importers pointed out that all cement shipments undergo stringent quality checks before being sold in the Philippines. Foreign suppliers must undergo inspection by the DTI’s Bureau of Philippine Standards (DTI-BPS) to ensure compliance with Philippine National Standards. Only cement that passes these inspections is granted a Philippine Standard (PS) license for importation.
Each cement shipment is also tested twice—once before leaving its country of origin and again upon arrival in the Philippines—by DTI-accredited laboratories to ensure it meets the required standards.
The traders also disputed claims made in the DTI’s preliminary report that local cement production has declined as imports have risen. The report showed that imports accounted for 30 percent of the market in 2019, rising to 35 percent in 2020, dropping to 26 percent in 2021, and then increasing to 41 percent in 2022, 47 percent in 2023, and 51 percent in the first half of 2024.
They, however, noted that domestic cement production capacity has been increasing, as members of the Cement Manufacturers Association of the Philippines (CeMAP) and non-CeMAP members alike have expanded their operations. For instance, Eagle Cement Corp. recently built a new manufacturing plant in Bulacan with a capacity of 1.5 MMT. Additionally, six new cement plants, including facilities in Cebu and Davao, have further increased domestic capacity.
The domestic cement industry has also focused on producing Type 1T cement, while imported cement has mainly composed of Type 1 and Type 1P products to ensure a consistent supply for the market.
“Clearly, the increase in importation is not due to a surge warranting the imposition of safeguard measures. Instead, it is primarily a consequence of reduced domestic production coupled with the necessity to meet ongoing demand,” the cement importers’ position paper emphasized, stressing that the imposition of safeguard measures is unjustified.
