Last week's announcement by the Caribbean Cement Company of an increase in the ex-factory price of cement by 12 per cent was another body blow to Jamaica's construction industry still struggling to recover from the recent influx of sub-standard quality cement into the distribution chain. This is the second price increase announced by the company in seven months, making the total increase about 35 per cent. This will send up the price of housing and continue to contribute to a rising inflation rate.
The timing of the new cement price increase is unfortunate and we agree with the head of the Incorporated Master Builders Association that this seems to be an attempt on the part of the company to pass on to consumers some of the costs it incurred in recalling bad cement from the trade - costs which resulted from its own negligence and bad judgement. Nor is upping prices going to help in improving cement production at the plant to meet pent-up demand in the industry. We do not feel, therefore, that the level of price increase can be justified. The current price of cement in Florida ranges between J$225 and J$280 per bag compared with the new announced price of J$370 per bag.
All of this will have a negative impact on the overall economy. In other countries the velocity of the housing industry is an important statistic in charting economic progress. Construction is a large employer of labour and stimulates overall consumer spending. Official monthly economic data in America always feature housing starts, the number of units and their value. As far as we are aware, although the figures are available at the end of the fiscal year, neither the Statistical Institute of Jamaica or the Planing Institute of Jamaica routinely report housing starts and we think this is a serious omission, which needs urgently to be corrected.
If all individual houses as well as housing schemes have to go through an approval process, we see no reason why these approvals should not be collated, cross-checked and included in all official economic statistics. The public would then be in a better position to correlate fluctuations in the housing industry with performance and prices by the cement company.
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