CMS promotes free and competitive trade in Sarawak

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CMS ensures that Sarawak’s market remains open and thus competitive in that there are no restrictions on cement players setting up plants or importing cement so long as they comply with the usual rules and regulations. — Photo by Chimon Upon

KUCHING: In response to a motion moved by Pujut Assemblyman Ting Tiong Choon, Cahya Mata Sarawak Bhd (CMS) says that it is erroneous to say the company has a monopoly over the production and sale of cement in Sarawak.

In a press statement, it affirmed that it has not increased the price of cement in Sarawak since January 2016, choosing instead to absorb the rising costs of producing cement itself and to improve its operational efficiency, without passing the burden to the customer.

It also pointed out that it ensures that Sarawak’s market remains open and thus competitive in that there are no restrictions on cement players setting up plants or importing cement so long as they comply with the usual rules and regulations.

It stated that contrary to the assertion made by Ting that since June 2016, one bag of 50kg cement is sold at RM21.50 in Sarawak, but at RM17.30 in Sabah, the true figure quoted by the Malaysian Department of Statistics is RM20.37 for a 50kg bag of cement in Sabah and RM21.14 for Sarawak – a difference of only RM0.77 and not the difference of RM4.20 stated by the assemblyman.

“The comparatively modest higher prices in Sarawak over Sabah can be attributed to discretionary mark-ups by dealers and retailers in view of the higher costs of living in parts of the state (such as Miri) and that prices in Sarawak cannot be expected to be the same due to the size of the State (124,451sq km vs 73,904 sq km for Sabah), which exponentially increases the cost of logistics due to longer delivery distances and double handling,” it said.

It also poitned out that as CMS has made clear on previous occasions, that there is only one manufacturer in the state with three plants reflect the limited size of the market and that it would not make financial sense for another player either to set up a plant or to develop a long term importing business.

“This is especially the case in Sarawak where CMS has ensured that its cement business efficiently meets all the State’s needs at a fair price,” it added.

CMS also attributes its cement division’s strength to being customer-centric and supplier focused providing quality cement reliably and at a fair price.

“This has motivated CMS to invest strongly in its quality controls and supply logistics – including plant upgrades, new equipment, jetties, barges and terminals, and, now, to anticipate future demand growth, in a one million MT grinding plant in Mambong, launched in November 2016,” it said.

It added, “CMS fully understands that our sole-supplier status gives us a responsibility and a duty to our customers. That is why we have invested in our cement business in the way we have, and we will continue to be very responsive always to the needs of our market and our state.”