Local cement manufacturers are again crying for help, seeking protection from the industry killer — the unabated entry of cheap imports from Vietnam. The ongoing infrastructure frenzy as development spreads throughout the country serves as a magnet for opportunism, disregarding the safety of individuals and the concept of fair play.

Thus, the need for government to step in and restore the level playing field. The Department of Trade and Industry (DTI) did just that of its own volition with its move to initiate an investigation into the suspected dumping of cement.

It initiated a preliminary investigation to determine if the surge in cement imports was causing injury to the domestic cement industry.

In a notice dated 28 October signed by Trade Secretary Ma. Cristina Roque, DTI invited stakeholders to submit comments on the proposal to impose a safeguard measure and on whether a protective tariff would be in the public interest. And in a report dated 31 October, the DTI said it found evidence to initiate a preliminary safeguards investigation.

Through its Import Surge Monitoring System, DTI said it recorded a surge in cement imports of combined Portland and blended cement from several countries from 2019 to June 2024.

Last 22 August, the Cement Manufacturers Association of the Philippines (CEMAP) was asked to provide data that could be used to evaluate the injury to the industry as defined under the Safeguard Measures Act.

The law allows the imposition of punitive tariffs to shield the local industry from cutthroat competition from imports.

On 28 August, DTI received submissions from CEMAP members Republic Cement Builders and Building Materials Inc., Holcim Philippines Inc., and Cemex Philippines, and non-member Eagle Cement Corp.

Aside from industry data, DTI secured information from the Bureau of Customs to establish the trend in imports.

DTI found the volume of cement imports in absolute terms increased during the period of investigation except in 2022. It grew by 10 percent in 2020, 17 percent in 2021, and 5 percent in 2023.

During the years covered, relative to domestic production, the volume of imports increased from some 30 percent in 2019 to 35 percent in 2020, and 36 percent in 2021 to 41 percent in 2022. In 2023, the share of imports to domestic production grew further to 47 percent and 51 percent in January-June 2024.

The trend showed imports progressively rising despite the capacity of local producers to amply supply the market.

Thus the share of local cement in the market showed a declining trend, except in 2021 when it grew by 14 percent. The share of domestic cement declined by 5 percent in 2020, down 11 percent in 2022, and lower by 6 percent in 2023.

The domestic industry’s revenues were affected, posting successive drops, from P79 billion in 2019 to P64 billion in 2023. Operating profit declined by 69 percent in 2022 and dropped further by 137 percent in 2023.

DTI’s investigation also indicated that the difference between the average selling price of imports and domestic products showed an undercutting of 24 percent. Domestic cement manufacturers have been forced to reduce prices by two percent to compete with cheap imports.

It noted that the significant increases in the volume of imported cement from 2019 to 2023 preceded the serious injury to the industry in 2023 and the market share of local cement producers decreased from 78 percent in 2019 to 68 percent in 2023 as a result of the flood of imports.

The timely action by the agency under Roque’s able leadership is expected to stem what is feared as the spiral of the local industry and prevent it from succumbing to the threat of the overwhelming deluge of imports.

Previously, the threat was shrugged off as the result of the opening of the economy but the current DTI leadership believed otherwise.