The ministry studied the situation in the cement market over the past six months and came to the conclusion it makes no sense to maintain tariffs for imported cement and clinker in favor of developers.
The bill proposes to establish a state tariff of about $37 (18,000 drams) per ton of imported cement and about $20 (10,000 drams) per ton of imported clinker.
The authors of the bill are convinced that this regulation will ensure equal conditions for local producers. Under the current law, imported clinker is not subject to tariff at all, and the cement tariff is about $29 (14,000 drams) per ton.
The cost of cement produced at Ararat Cement plant is about $75 (36,200 drams), and about 82 dollars (39,500 dram) at Hrazdan Cement plant. While — according to the Ministry of Economy of Armenia — the cost of cement imported from Iran is about $37 (18,000 drams). The cost of cement produced in Armenia (using Iranian clinker) is about $54 (26,000 drams).
An unprecedented amount of cement and clinker were imported to Armenia in Jan-Jun 2019 on the backdrop of the expected tariffs. Imports continued to grow in July-October. Armenia received 232,000 tons of imported cement worth $25 million over Jan-Sep. According to the Armenian Statistical Committee, this is two times more than a year ago and 6.5 times more than in Jan-Sep 2017.
At the same time, the local production of cement practically did not increase compared to last year: 431,000 tons of cement in 2019, and 401,000 tons in 2018.
Hrazdan Cement plant informed Cement and its Applications that they had to suspend production in the spring of 2019 and restart the kilns on July 30th.
