ECONOMYNEXT – Sri Lanka’s INSEE Cement, a unit of Siam City Cement of Thailand said it was adding two ships to boost supplies as forex shortages cut off imports to the island disrupting construction.
INSEE which has an integrated cement plant Puttalam and also a grinding plant in Galle said it was already producing and importing 3.6 million metric tonnes to meet demand.
Sri Lanka’s government initially created a shortage by imposing price controls as the rupee fell and forex shortages were created by printing money.
However though price controls were lifted, importers were finding it difficult to resume supplies and forex shortages continue to be experienced.
“Unfortunately now, they are struggling to revive the interrupted supply chain due to cement exporters struggling to meet the demand in their own countries,” Gustavo Navarro, Chief Executive Officer at INSEE Cement said in a statement.
“Therefore today, even with the Government lifting controlled pricing, we have a shortage of cement imports to Sri Lanka.
“INSEE is once again stepping up to meet this challenge by introducing two more additional import vessels to our logistics operation.”
The US Federal Reserve is also printing money amid a post-Covid recovery, triggering an indiscriminate aggregate demand bubble which has pushed up commodity prices, disrupted supply chains and is also pushing wages up in the US.
Several prudent reserve currency central banks have started to tighten monetary policy.
Sri Lanka’s consumer minister Lasantha Alagiyawanna said a decision has been taken to allow several hundred thousand tonnes of cement to be bagged in plastic packs amid a shortfall in standard bags, to ease shortfalls.
INSEE Cement is optimizing its express logistics, delivery channels and bulk carrier fleet to ensure uninterrupted market supply to customers as well as winning business from competitors.
Jan Kunigk, Executive Vice President, Sales, Marketing and Innovation, claimed the country should reduce dependency on imports as exporting nations traded opportunistically.
However observers say the right to free trade is an important economic freedom of both businesses and individuals. (Colombo/Nov03/2021)