Close down cement factories producing substandard products - Trade Minister authorises GSA

The Minister of Trade, Agribusiness and Industry, Elizabeth Ofosu-Adjare, has authorised the Ghana Standards Authority (GSA) to close down all cement manufacturing companies producing substandard products for the Ghanaian market immediately.

She said shutting down such factories would stop them from putting dangerous products that posed serious threats to consumers, industry, professionals and property owners on the market.

“Close down companies that are defaulting with substandard products to stop production till they can demonstrate that they can produce quality products consistently and until you are satisfied that they are not circulating substandard products,” Mrs Ofosu-Adjare said.

Disturbing data

Data on cement quality submitted by the GSA at a stakeholder meeting of the nine-member Cement Manufacturing Development Committee (CMDC) and industry players on March 5, this year, showed that some cement companies are producing cement which does not meet the Ghanaian standards.

But the Cement Manufacturers Development Committee Regulation L.I. 2480 authorises the minister, through the committee, to withdraw the licence of any company producing cement that does not meet Ghanaian standards.

Besides, Ghana Standard Authority Act, 2022 (Act 1,078) also authorises the authority to stop the sale, production or distribution of any product that does not meet Ghanaian standards. 

Suicide mechanism

At a stakeholder meeting at the ministry in Accra last Friday, Mrs Ofosu-Adjare said safety was key, and as such pricing should never be used as a suicide mechanism to produce substandard products.

“Because when there are substandard products, especially building materials, they are at risk of collapsing on everybody”.

“We all stay in hotels and guesthouses and our families, our relatives and our friends stand a risk if cement quality is not checked,” she said.

The meeting, chaired by Mrs Ofosu-Adjare, followed the recent unilateral cement price increases announced by cement companies without the input of the nine-member CMDC.

The committee, chaired by the Director-General of the GSA, Professor Alex Dodoo, was set up in line with LI 2480) which mandates it to oversee the development and growth of the local manufacture of cement as well as to monitor and coordinate activities in the manufacture of cement.

Those at the meeting were Prof. Dodoo, Executive Secretary of the Chamber of Cement Manufacturers Ghana, Rt Rev. Dr George Dawson-Ahmoah, who is also a member of the committee, a representative of the Association of Ghana Industries and an independent expert.

Others were the Deputy Minister of Trade, Agribusiness and Industry, Sampson Ahi, and the Chief Director of the ministry, Noah Tumfo.

They also discussed the challenges facing the cement industry, particularly the recent cement price increases and the quality of cement on the market.

At the meeting, the industry players admitted that they took a unilateral price increase and would reduce their prices and abide by the law in announcing future prices in good faith. 

Fair pricing

The minister said unequivocally that while pricing of cement should be fair, companies must desist from using inferior materials in production.

Mrs Ofosu-Adjare, therefore, pledged to undertake frequent visits to cement producing factories to ensure that issues of substandard cement would be “a thing of the past”.

“We will police pricing to ensure that there is no substandard product because if industry wants to produce substandard in order to be competitive, that will be suicidal, and it will not happen.

“We will ensure that the industry is well regulated to protect everyone, including professionals, engineers, homeowners and consumers,” the minister assured.

“We want to protect consumers and also facilitate industry; we are not here for price control but we want fair pricing,” Mrs Ofosu-Adjare added.

Abide by the law

On the issues of price increases, the minister said the law was clear that cement prices were to be declared by the CMDC and not by the industry.

Thus, at the beginning of every month, the committee shall publish the maximum ex-factory price of the two main types of cement on the Ghanaian market — 32.5 R and 42.5 R — to ensure that consumers were carried along, she said.

“If the prices declared by the companies are not satisfactory to the committee, it will refuse and if your price is not approved, you cannot sell,” she stated.

“The law is that your retail prices shall be certified by the committee and then you proceed to sell,” Mrs Ofosu-Adjare added.

Reduction in price  

Prof. Dodoo, for his part, said the committee had given every cement company the eighth of every month to declare their prices whether there was an increase or not for the committee to publish to consumers on the 15th of every month.

He said there was an agreement that while exchange rate fluctuations affected cement prices since almost 70 per cent of their inputs were imported, they must be mindful of the difficult times Ghanaians were going through.