The Cement Industry Employers’ Union (CEIS) explained the increase related claims in cement prices. CEIS Board Chairman Tufan Unal said:
“Although our union is not a direct addressee of the update in cement prices, I would like to present some explanations on the subject as chairman of CEIS Board of Directors.
The news that some cement companies have been going for a price update from January 1, 2019 has been published in the press. However, pricing with a collective decision cannot be in question. Each company makes independent decisions with its discretion. Therefore, if a price update is realized, this update will be in the company’s own decisions.
On the other hand, there are significant cost increases in cement production as in many other industries. The cement sector has two major cost items. The first one is energy and the second one is labor.
In terms of energy costs, the petroleum coke cost increased by 170 percent in TL terms in the last two years. Electricity costs increased by 76 percent in the last two years. In the same period, the rate of increase in coal cost was 182 percent. In general, the producer price index increased by 73 percent from the beginning of 2016 until the end of November 2018.
Despite the increase in production costs, when we look at the last two years, it is seen that the cement prices have increased by only 27 percent in average. However, cement companies have supported the Total Fight Against Inflation Campaign by the Government and the cement prices have decreased in the last year.
Another important element for our sector is labor cost. Our sector, employing 17 thousand employees, pays utmost attention to all legal rights, salary updates and occupational health and safety practices of its employees. Due to the 26 percent increase in the minimum wage, all employee wages also need to be updated.
We would like you to know that this is a sector which never sacrifice on occupational health and safety investments and works with the principle of “Zero Work Accident” under all circumstances. Our sector, which has invested approximately 150 million TL in occupational health and safety in the last 10 years, will continue to make these investments without compromise.
The cement industry is a sector that attaches great importance to solidarity with other sectors in which it does business, and it is seen that the increases in energy and labor costs have not been reflected in the prices for the last two years. The most important indicator is that the cement prices in Turkey is the cheapest in the world, including China.
