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TC raises duty vs imported cement

August 15, 2019

Trade Secretary Ramon Lopez on Wednesday welcomed the Tariff Commission’s (TC) report which slapped higher and definitive safeguard duty on imported cement, but noted his department is still reviewing the evaluations made.

TC raises duty vs imported cement 1

“We just got the full report of Tariff Commission on cement and will study the evaluations made. But we welcome their findings, after a series of public consultations, that there was injury to the industry, and that the safeguard duty should be P297 per metric ton or P12 per 40-kilogram bag,” Lopez said in a Viber message late Tuesday.

The TC report said the P12-safeguard duty ‘is the difference between the weighted average landed cost of imported cement and the average domestic ex-plant selling price of the local cement industry for 2018.

“Since it addresses the extent of price undercutting by cement imports based on the latest available data, the Commission believes that this level of safeguard may prevent the occurrence of serious injury to the domestic cement industry and will facilitate said industry’s adjustment to the adverse effects of increasing cement imports,” the report said.

The definitive safeguard duty will be applied for a period of three years starting from the date when the provisional measure took effect, the TC said.

In January this year, the DTI slapped a provisional safeguard duty of P8.40 per bag on cement imports to address shipments surge said to be hurting the local cement industry.

The amount, equivalent to just under 4 percent of the average retail price of P220 per 40-kilogram bag, should be paid in the “form of a cash bond” and will remain in effect for 200 days.

Lopez earlier claimed that “imports of cement increased from only 3,558 metric tons (MT) in 2013 to more than 3 million MT in 2017. The share of imports increased from only 0.02 percent to 15 percent during the same period.”

Following the imposition of provisional safeguard duty, the TC conducted several public consultations to determine whether a definitive safeguard measure should be in place.

“We shall review this [P12] safeguard duty,” said Lopez.

In a statement, consumer group Laban Konsyumer Inc. (LKI) said DTI should make sure retail prices of cement are always monitored.

“The mandate now to DTI is to monitor retail prices and show the lower price edge in pricing for local cement manufacturers vis a vis imported cement,” said LKI President Vic Dimagiba.

“There should be clear and regular price monitoring report of retail prices. If necessary, DTI should now implement an SRP (suggested retail price) in cement when the lower price of local cement is not prevailing in the retail market,” he added.

Dimagiba said the DTI must also make sure there is steady supply of cement in the market. “On supply, it is dictated by demand. The supply side should remain steady and stable. All importers will continue to import when their math shows that they will make profit but taking into consideration the safeguard duty and other administrative costs,” he said.

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