Construction development company Business & Marketing Intelligence (BMI) Building Strategy Research Unit principal consultant Dr Llewellyn Lewis has called on the Competition Commission to reverse its decision to prohibit the centralised publication of cement use statistics.

The commission, in its cement producer Afrisam cement cartel ruling, in November, noted cement producers Afrisam, Pretoria Portland Cement, Lafarge Industries South Africa and Natal Portland Cement Cimpor submitted sales information to the Cement and Concrete Institute for South Africa (C&CI) and used the aggregated information received from the C&CI as a mechanism for maintaining a cement market share cartel.

However, Lewis questions the timing and vali- dity of the decision to prohibit the publication of cement use statistics, especially in light of the difficult conditions the industry continues to face following a slump in public and private construction spending after the completion of the 2010 World Cup and amid a stuttering recovery.

“The timing of this decision could not be worse for the industry, as the strategic importance of this data is enormous. These statistics constitute the most current and reliable indicator of building activity, because cement is the most widely used construction material.

“Having this information affords companies the ability to plan their capacity in real-time synchronisation with market activity, making it a significant planning tool – not a marketing tool,” he explains.

However, Competition Commission chief economist Dr Simon Roberts says the informa- tion needs to be collated and aggregated, possibly over longer time periods, such as quarterly, so that it still provides value for users but reduces its value to firms wanting to dampen competition between themselves.

“Where the line is drawn depends on the specific nature of the product and industry, including the number of firms. It is also impor- tant that the information is collated by an independent body,” he says.

Meanwhile, representations made by stakeholders to the commission are explicit “that the data provides information on volume and end-use product broken down by province”, and does not refer to pricing or market share, emphasises Lewis.

“The data cannot be seen as collusive because it provides no information on pricing, market share, profit of the various suppliers or any other information that could be used to collude on pricing or market allocation. Withholding it is akin to banning the publication of statistics on car sales or mort- gage advances, which have long been held up as critical economic indicators,” he states.

“The Competition Commission and banks need to be realistic about the impact of their actions on the building and construction industry, which is a major player in our economy and a key creator of jobs in this country. Anything that can be done to facilitate the market’s recovery should be a priority for every stakeholder.”

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