(Business in Cameroon) - Yesterday September 14, 2021, in Yaoundé, Minister of Commerce Luc Magloire Mbarga Atangana granted an audience to a delegation of LafargeHolcim Maroc Afrique (LHMA), the majority shareholder in CIMENCAM, one of the main cement producers in Cameroon. During the audience, the delegation, led by LHMA’s President and CEO Xavier Saint-Martin Tillet, informed that because of the rise in international clinker prices, cement prices should normally go up by XAF1200.
Due to the rising clinker prices, CIMENCAM is currently facing between XAF2 to 3 billion additional expenses monthly. If we were to pass those expenses, the price of a cement bag would exceed XAF6,000. We have come to exchange with the Minister of Commerce on how we can reduce part of those additional expenses via tax incentives or even by passing part of the expenses onto cement prices. (…) The issue here is how we will manage the additional production cost of XAF1200 per bag of cement," declared Xavier Saint-Martin Tillet.
"Cement production costs are fluctuating due to health and economic constraints. We are here to discuss how the government can help the company continue to produce cement at acceptable prices," added Yves Mbele Ndoe, Chairman of CIMENCAM’s administrative board.
On September 2, 2021, the Minister had contacted the World Trade Organization, through correspondence sent to its director-general Ngozi Okonjo-Iweala. In his correspondence, the official reported the unprecedented deregulation of international trade. "For instance, between January and June 2021, the prices of clinker, rebar, and gypsum rose by 100%, 95.54%, and 60% respectively, compared with their rates during that same period in 2020. At the same time, the prices of wheat, soybean, and corn rose by 31.6%, 6%, 73%, and 98.4% respectively and maritime freight rates rose three folds," Luc Magloire Mbarga Atangana wrote.
So, "in the future, price adjustments could come into play, notably in the construction material industry where the last price controlling measure was issued over ten years ago in a much different context," he added.
For the time being, the government is maintaining the official price of XAF4,900 per 50-kg bag in Yaoundé and XAF4300 in Douala where CIMENCAM has its main plant.