Industries have lowered cement and iron rod prices citing reduction in production costs due to reduced power cuts in industrial areas.
Raghunandan Maru, president of the Cement Manufacturers' Association of Nepal, stated that cement prices have dropped by up to Rs 15 per bag. Similarly, Pawan Sharda, operator of Premier Steel Industries, announced that the price of iron rods has been reduced by Rs 2 per kg.
In November, a bag of cement was priced at Rs 500, but repeated price hikes pushed it up to Rs 850 by mid- March. Now, the price has fallen slightly. Maru attributed this to a reduction in daily power outages from 12 hours to 7 hours, which has lowered production costs.
The Nepal Electricity Authority (NEA) had limited power supply to industries since mid-March due to India’s refusal to supply electricity at night. However, a few days ago, India resumed supplying power for an additional four hours at night, easing the situation for the NEA and enabling better power distribution to industries.
As a result, industrialists in the eastern region, where power supply has improved, have reduced prices.
The industrialists were earlier accused of creating an artificial shortage to inflate the prices due to a lack of government intervention.
The steel industry had earlier raised prices of iron rods by Rs 12 to 18 per kg (excluding VAT) since March 2, with rates reaching Rs 105 per kg by the third week of March. The price of iron rod was Rs 87 in mid- February.
The Department of Commerce, Supplies, and Consumer Protection had previously warned of action if cement and iron rod prices were not adjusted. In response, the department has now instructed cement, steel, and iron industries across the country to disclose the details of their production cost. Some industries have already submitted this information, while others have pledged to do so.
Meanwhile, the Federation of Contractors' Associations of Nepal has long been accusing the manufacturers of creating an artificial shortage to hike the prices. The umbrella body of construction entrepreneurs argues that inflated cement and iron rod prices could drive up construction costs and delay ongoing projects.
