Ministry of Trade & Industry threatens to take administrative and legal measures against traders of cement involved in hoarding and price gouging practices.
Currently, there is a critical shortage of cement in Ethiopia, while the item is being sold as high as 800 Birr a quintal, more than twice the ceiling rate set by the Ministry.
In a consultative meeting held with the producers of cement, regional trade bureaus, and law enforcement bodies, including high-level officials of the Federal Police Commission and Intelligence Office, Melaku Alebel, Minister of Trade & Industry, warned that the government will take serious actions on traders who charge unreasonable price.
"Traders can increase the price of cement if only the government undertakes a study and allow them to do so," said Melaku.
Factory price of cement now costs between 233 Birr and 290 Birr, according to the ceiling rate set by the Ministry, which says the profit margin of retailers and wholesalers should not exceed from 20 to 30 Birr a quintal.
"We will give only one month period to stop their malpractices, including price gouging. Otherwise, we will take any measure that is appropriate to solve the shortage faced by citizens and companies involved in the construction sector," said Melaku.
Ethiopia has 14 cement factories, having a production capacity of 15.1 million tonnes annually. Currently, the actual production of cement stands around 9 million tonnes a year, which is lower than the 11.5 million tonnes demand a year.