Surge in imports of roofing materials and rising cement prices mark the resumption of construction activities following the lockdown.
The Department of Trade and Industry (DTI) has initiated a preliminary investigation on the application for safeguard measures or additional duties on imported aluminum zin (GL) sheets, coils and strips.
“Increased imports of GL sheets, coils and strips are the substantial cause of serious injury to the domestic industry in terms of declining market share, production, sales, capacity utilization, profitability, employment, price depression, suppression and price undercutting,” said DTI in its report dated June 15, 2020.
The DTI was acting on the petition of Sonic Steel Industries Inc. which produces both zinc coated galvanized and GL coated steel sheets in Cavite.
In its analysis on the period of investigation (POI) 2014 and 2018, the DTI determined that the average landed cost of imports is lower than the average selling price of the domestic product, indicating a price undercutting of approximately 9 percent in 2018.
The DTI report added there were significant increases in the volume of imported GL in 2015 (3,090 percent), 2016 (300 percent), 2017 (7 percent) and in 2018 (20 percent) preceded the serious injury to the industry in 2018. The industry suffered declines in sales, production, utilization rate, profitability and employment. Inventory increased from 2014 to 2018.
The report added the market share of domestic product decreased during the POI from 99 percent in 2014 to 25 percent in 2018, as share of imports in the domestic market displaced locally produced GL.
It noted that there has been a recent, sharp, sudden and significant increase in imports from 770 metric tons (MT) in 2014 to 126,000MT in 2018.
From just 1 percent in 2014, imports share increased to 35 percent in 2015, to 145 percent in 2016, and to 156 percent in 2017. The share peaked to 198 percent in 2018,
In contrast, production declined continuously that led to a 40-percent cut in employment from 2014 to 2018.
Meanwhile, prices of cement spiked across the country by P20 to almost P50 per bag depending on the brand, a consumer group said in a statement.
“We are concerned because we saw a recent spike in cement prices, as they shot up to the dismay of many consumers, both household and corporate,” said Vic Dimagiba, president of Laban Konsyumer Inc., citing data from DTI.
Dimagiba urged DTI to closely monitor cement prices especially at this time when construction of private and government projects restart.
He said stable prices will enable consumers to prepare long-term on their construction and will reatly affect the progress of the government’s Build, Build, Build program.
“We hope some action can be taken, and customers can be reassured the prices they are paying for in cement are fair, above-board and commensurate to what they are acquiring,” Dimagiba.
