Editorial: Cement price to fall in accordance with cedi strengthening

The Ghana Standards Authority (GSA) is working with cement producers to ensure that prices reflect the cedi’s recent appreciation against major trading currencies.

According to the Director-General of GSA, Prof. Alex Dodoo, most manufacturers have already submitted their pricing for June.

However, the Cement Manufacturing Development Committee is expected to review and certify these prices while also engaging producers on the need to adjust pricing downward to provide relief for consumers.

The GSA boss spoke on the sidelines of a stakeholder engagement on construction materials, dubbed ‘Symposium on Science-Based Innovation for Robust Construction Materials in Ghana’, in Accra recently.

“Two things normally tend to happen when a currency strengthens: companies wait to see whether it’s just a blip or a long-term thing before they take action. In the same way – and also in fairness to the companies – when the currency was falling, the price changes were not daily.”

In view of this, he said, he has already been assured by manufacturers that if the cedi’s strengthening is maintained over the next few weeks, “we should expect prices to fall”.

In a related development, the Ghana Real Estate Developers Association (GREDA) also called for suppliers of building materials to reduce prices in response to improved macroeconomic conditions.

The GREDA president, Dr. James Orleans-Lindsay, noted that although the cedi has appreciated, cost of critical construction inputs – particularly cement and iron rods – remains unchanged.

Although housing developers continue to price homes in cedis, reflecting exchange rate movements,  suppliers have not adjusted their prices… which is undermining efforts to make housing affordable.

Prof. Dodoo disclosed that Ghana is the first country so far to have developed a standard for cement that replaces a large amount of clinker, adding that Ghana has the biggest factory producing this type of cement.

Thus, the country will save about half a billion dollars in terms of money that would otherwise be used to import clinker substitutes.

Prof. Doodo said  the country has now developed laws to ensure that cement on the market is of good quality.  “We have standards and GSA is doing a lot of surveillance.”

The stakeholder symposium was organised by GSA in partnership with the Federal Institute for Materials Research and Testing for Germany (BAM) and others.

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