Ashford W. Meikle, Staff Reporter
Anthony Haynes (left), general manager of Carib Cement Company Ltd., and Dr. Omar Davies, Minister of Finance and Planning, tour the Cement Company quarry in Bull Bay, St. Andrew, in July. - NORMAN GRINDLEY/DEPUTY CHIEF PHOTOGRAPHER
CARIBBEAN CEMENT Company Limited (CCCL) says that it will import some 40,000 metric tonnes (MT) of cement to plug the shortfall in demand which customers have been experiencing over the past month. The imported amount is
equivalent to just over two weeks' supply of cement.
Speaking at a press conference at the company's Rockfort offices, General Manager Anthony Haynes said the import "will close the backlog and restore inventories to their previous levels."
According to Haynes 16,000 MT will arrive by mid-December with the remainder by the first quarter of 2006. He said the cement would be sourced from within the Trinidad Cement Limited (TCL) group - specifically Arawak Cement in Barbados - and its partners, Cemex, in Mexico.
FULL APPLICABLE DUTIES
The company says that it will pay the full applicable duties on imported cement (currently 40 per cent) and will absorb the full costs. Customers, therefore, would continue to purchase the product at the existing price of Carib Cement Plus.
Since October, Carib Cement has had difficulty in satisfying the local demand of cement because of what the general manager described as force majeure circumstances, which precluded Carib Cement achieving its full production capacity. Haynes pointed specifically to the three-day industrial strike in October, during which there was no production at the plant. This was followed by eight days of continuous rainfall caused by Hurricane Wilma.
These factors, he said, "did considerable damage to stockpiles as well as raw materials in storage [and] resulted in severe disruption in production, of and depletion of inventories."
He pointed out that prior to the interruption in its production CCCL started the month of October with 25,000 MT of cement, or the equivalent of one and a half weeks' supply.
The managing director, who repeatedly expressed Carib Cement's regret at the inconvenience to customers, said the company "recognises its responsibility in ensuring that the Jamaican market is adequately supplied with cement." He said the Carib Cement "plant is now back to normal production."
According to Haynes, the cement manufacturer began consulting with its 200 customers on November 4 with a letter, which was followed up by islandwide meetings to monitor the situation. This process, he said, "would continue to ensure careful management of supplies until full normality [is] restored to the market."
Caribbean Cement controls just over 90 per cent of the local cement market and has, according to Haynes, "fully supplied the demand for cement up to October this year," since the imposition of the 40 per cent import tariff on cement in December 2003.
While Haynes declined to quantify the losses suffered by CCCL since October, he admitted that the company had managed to supply 80 per cent of the demand. Typically, at this time of the year the demand for cement is about 17,000 MT per week.
Emphasising that CCCL "will be very much prepared in the future," he said the company has begun to implement plans to deal with similar, future challenges. For example, the company had signed an MoU "with the unions to foster improved industrial relations."
As well, there would be additional storage areas for raw material and clinker, plus "extensive work to be done on access roads to quarries to improve accessibility during continuous rainfall."
The company acknowledged that a price increase is imminent, given the rise in raw material prices and electricity costs - which CCCL has absorbed over the past few months. However according to marketing manager, Alice Hyde, there will be "no price adjustment until the supply returns to normal."
