A critical shortage of cement is hitting East London builders as suppliers battle to get stock. As a result, prices for a 50kg pocket have skyrocketed as local building supply companies are forced to ship cement in from other areas.

Buffalo Build It owner Lyndre Meyer said the situation was so desperate they had resorted to trucking cement in from Port Elizabeth and Johannesburg.

“We used to take an average of seven loads a week, now we’re lucky if we get one,” she said.

Meyer said a 50kg pocket of cement normally sold for around R65. Bringing it in from Port Elizabeth increased the price to around R75, and from Gauteng to R82.

“I’ve spoken to builders who are desperate for cement and will pay up to R100 if they could just get their hands on a pocket,” she said. “They can’t work without it and many of them have penalty clauses if they are late.”

John Friend, manager of Buildrite in Gonubie, said they were also bringing in cement from Johannesburg.

“We used to get about a load a day in, now we’re only getting one load a week. It’s definitely impacting business and building sites. I’ve heard of some shutting down for a few days because of the problem.”

Rory Cox, a director at WBHO Construction, said the company was busy with a stabilising project at the East London Industrial Development Zone and were struggling with a short supply of cement.

“We’re building a parking area for the IDZ and are battling to get cement for the project.”

Rod Phillips, owner of Lewcon Construction, said the shortage had affected him directly. “You can’t work without cement and it’s a real problem,” he said.

The Border area is traditionally supplied by AfriSam (formerly known as Holcim), who would only respond to the Daily Dispatch’s questions via a short statement from the company CEO, Charles Naudé.

“The main cause of the current cement shortage is logistical and production challenges which we have been experiencing over the past few weeks. AfriSam is running its production plants as hard as possible to address this problem.

“To ensure consistent supply to our customers, we have been subsidising the supply of imported cement in the first half of the year. However, cost pressures and volatile fluctuations in the exchange rate have made ongoing imports highly risky and unsustainable.”

In their desperation to get cement, some local suppliers tried to turn to PPC Cement in Port Elizabeth for supply, but the company is not able to meet the demand.

“Our Port Elizabeth factory is our smallest, producing about a quarter-of-a-million tons of cement per year,” said chief operating officer Orrie Fenn. “Demand has increased significantly, though, and at present the PE market is bigger than what we can supply.”

Fenn said another reason for not supplying East London was the cost of transport.

“Cement doesn’t travel well. It’s a high-weight, low-cost product and transport raises the costs considerably.”

Fenn said the current demand for cement was being driven by a number of infrastructure projects taking place around the country, including the Gautrain in Johannesburg and stadiums for the 2010 Soccer World Cup.

PUBLICATION: Daily Dispatch Online
AUTHOR: ANDREW STONE
DATED: 11th November 2008