JEDDAH, 24 April 2005 — In its continued efforts at monitoring the availability of products in the market and their prices, the Ministry of Commerce has noticed the increase in the price of cement. The ministry attributed the price rise to an increase in demand and a limited number of truck owners taking advantage of the situation by selling cement at higher prices.
Deputy director of internal commerce at the ministry, Abdullah Al-Homudi, announced yesterday that the ministry is following up on the issue and that it is keen on stabilizing the market and not raising the prices. “There is coordination between the ministry and the cement producing companies which are working at full production capacity and some of them in fact have increased their output to meet the increase in demand and keeping the prices at their regular range,” said Al-Homudi.
He added that the Ministry is currently coordinating with all the cement companies to guarantee that the distributors and truck owners receive enough cement without delay to supply the local market. “The ministry will continue to monitor the prices on a daily basis in all the local markets to make sure that the prices return to their regular range and that it will take all necessary regulatory measures against those who violate the regulations on raising prices,” he said.
Arab News reported last week that the prices of cement and other construction materials have been on the rise in the past few weeks. The price of a sack of cement went up to SR16 as opposed to the regular SR12 to SR14 price range due to an increase in demand with all the construction projects around the country.
In addition to natural disasters which affected imports from Asian countries, reasons for the price increase are also attributed to the increase in oil prices, shipping expenses and currency rate exchange which are all factored into the price of imported materials. There are eight cement companies in Saudi Arabia and the Ministry of Commerce has recently licensed seven more cement factories in Riyadh, Jeddah, Dammam, Hail and Badr. The investment capital for the new factories is around SR4 billion with a total production capacity of 8 million tons annually. In addition, several of the current eight cement companies are also expanding their factories.
