Spike in cement price will have impact on construction industry, says SUPP man

Dato Sim Kiang Chiok

KUCHING (Feb 24): The increase in cement price as reported recently will undoubtedly cause an impact on the construction industry, said Sarawak United People’s Party (SUPP) Stakan branch chairman Dato Sim Kiang Chiok.

“In my personal opinion on the announcement of the cement price increase from Feb 17 and as a contractor and developer with 35 years of experience, this will have an effect and impact on our industry.

“Cement is the basic material for all construction of buildings and infrastructure, just like steel which is also a basic material for construction,” he said when prompted for comments.

Sim, who is also Sarawak Housing and Real Estate Developers’ Association (Sheda) Kuching chairman, said cement is used in building structure, plastering, screening, concrete drain, concrete roofing tiles, concrete piles and ceramic tiles application.

However, Sim said developers would have to absorb the increase in costs if the construction works were already in progress and the properties were sold.

For unsold units, he said the selling price might be adjusted upward to cater to the increase in cost and the revised concrete price will be factored in for new contracts and development.

“For contractors, if their contract has a price adjustment clause for increase in building material price, they are safe. But for those without the price variation clause, they will have to absorb the price increase which will reduce their profit margin,” said Sim.

He added that cement could be imported from Peninsular Malaysia but the suppliers there too have increased their price.

“And with additional freight cost from there, their price will be dearer than the cement produced locally, even with the present price increase,” said Sim.

On Feb 12, CMS Cement Industries Sdn Bhd announced that cement prices will be revised upward by an average of 10 per cent, subject to product type and location effective Feb 17.

The company attributed the increase to significant and sustained rising cost of raw and packaging materials, and freight charges.

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