The Monopoly

Topics: Monopoly, Portland cement, Marketing Pages: 3 (1006 words) Published: January 20, 2013
The Monopoly
Ahmed El-Zeini, chairman of the division of building materials in the Chamber of Commerce in Egypt, says: "Some analysts believe that the cement industry has suffered too much from the monopoly of certain local manufacturers, not to mention the manipulation of prices. The Egyptian Authority for the protection of competition and prevention of monopolistic practices has begun to study the cost of cement production in the local plants, to make sure no monopolistic practices are being carried out by the companies, which could be harmful to the consumer or the market." Mr. Zeini also asked the traders to provide the cement delivery notes issued by the plants, to match them with the copies kept by the same plants, to prove that the plants are selling cement for two prices, one written down on the bag and ranging between EGP 500 and 565, and the other sold to the agents and ranging between EGP 350 and 450 per ton, thus violating the law. Mr. Zeini added: "Foreign cement plants account for 80% of the cement production in Egypt, and are fighting the new national plants, in particular the Army Cement Plant in Al-Arish, the Wadi El Nile plant in Beni Suef, El-Sweidi plant in Suez and El Nahda cement plant in Qena, by the means of a tacit agreement to cut prices by an average of EGP 180, so that new plants pull back the prices they announced 4 months ago when they decided to sell the ton of cement for EGP 375, ex-factory. He explained that there is a protocol between foreign plants to avoid competition in the export of cement from Egypt, even if they had committed not to export cement to countries where Egyptian plants exist. A statement issued by Suez Cement Group, owners of Tourah, Helwan, Qutemiah and Suez plants, accounting for 25% of the Egyptian cement production, said that the prices written on the bags are the maximum limits for the authorized end-consumer sale price and ex-factory sale price, while the cement price actually sold to customers may differ...
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