Production slumps at Diamond Cement

Production at the Diamond Cement Ghana Limited (DCGL) at Aflao appears to have slumped, supposedly in the face of lopsided competition from cheap imported cement lately.

The Ghana News Agency (GNA) got the hint, observing the declining number of haulage trucks at the vicinity of the factory at Aflao-Akporkploe. The Management staff of DCGL when contacted refused to comment on the issue, passing-the-buck from one officer to the other.

A contract Agent of the DCGL told the GNA that, the company had a serious marketing problem, having to adopt a bonus regime on purchases lately, to entice clients. He declined further probing by the GNA.

The Aflao Cement Factory is perhaps the only large manufacturing firm in the Volta Region, after the demise of the Juapong Textile Limited, a grey-baft firm, and reactivated under new ownership, but remaining below the bottom-line.

A Dealer, who also has social stakes in the operations of DCGL agreed to speak to the GNA about the situation at the Aflao Cement Factory strictly on conditions of anonymity. He said the DCGL is currently not in full production and had indeed resorted to alternating production days to allow for the glut in the market and factory to be cleared.

“Production is done for three days, then it is stopped for a while and resumes for another three days and so on, that is how things are going. And the cut in production could be 40 per cent or thereabout,” he stated. GNA checks on the market indicate that the competition was coming from SOL-Cement of China, cement imported from Kankan in Iran and Dankote Cement from Nigeria.

Their prizes per bag range from Gh¢15.80 to Gh¢16.20. DCGL produces two different packages of cement, paper bag and polypropylene, and costs Gh¢15.94 and Gh¢16.17, respectively. The prices include transport and off-loading at the destinations.

The Dealer said the Ghana Cement Limited (GHACEM), with production lines in Tema and Takoradi, whose cement per bag cost Gh¢16.14, was also being affected by the influx of imported cement on the market. The source said it appeared interplay of pricing and proximity could be working against the DCGL products, especially.

He said competing products come through the seaports, which are nearer the markets but Aflao was further away, located on the Ghana/Togo border. The source alleged that these competing products could be enjoying some official support in terms of low taxes at the ports, making those products cheaper; a situation he said, if true was “grossly unfair”.

He observed that DCGL was the “breadwinner” of Aflao, directly employing 100 people, scores of others on contract and thousands indirectly. He said should the local cement factories go the same way as the textile companies, flushed out of the market by cheaper imports, “it would be catastrophic for Aflao, especially, and the country in general.”

The dealer appealed to government to tackle the impeding “local cement debacle,” considering the socio-economic cost to the nation, as the local companies, besides giving jobs to many, contribute to the national kitty through various taxes, levies and fees.

He said in the case of the DCGL, it was a major client of the Electricity Corporation of Ghana (ECG) in the Volta Region, where a huge percentage of power users were in the lifeline category.

Diamond Cement (Ghana) Limited received its certificate of incorporation on 3rd August, 1998 and commenced business in April, 2000. DCGL has a subsidiary at Buipe, in the Northern Region; Savannah Cement, producing both clinker and cement.