FTC order reduces local sand price from $42 to $37
This island’s trade regulator has forced the main supplier of sand to slash its price.
Following an outcry by distributors, truckers and players in the construction sector over a near-doubling of the price by dominant wholesaler Walkers Sand Quarry in St Andrew, the Fair Trading Commission (FTC) has ruled that the increase was not only “excessive” but “unreasonable”.
Walkers Sand Quarry, a division of Island Developments Limited (IDL), had thrown players in the construction industry in a quandry when it announced on March 10 this year that they would have to pay almost twice as much per tonne for the sand with immediate effect. The decision resulted in a hike in the sand price from $22.70 to $42.01.
However, following a review of all of the evidence available to it on the matter, including the written responses and oral presentations of IDL, the FTC ordered that an adjustment be made.
“The Commission directed that IDL cease this practice by reducing the per tonne price of sand to a level that bears a more reasonable relationship to its underlying cost,” the FTC said.
“The Commission found that . . . the dominant supplier of wholesale sand in Barbados, in increasing its price from $22.70 to $42.01 on March 10, 2014, imposed an unfair selling price on wholesale sand that was excessive and unreasonable,” it ruled.
The regulator also revealed that the company had since adhered to its directive to bring down the price.
“Island Development Ltd has complied with the Commission’s directive and reduced the price of sand to $37 per tonne. The Commission is satisfied that this price is reasonable.”
There was immediate reaction from stakeholders to the ruling.
“Not bad,” declared Collin Small, managing director of CS Construction at Chance Hall, St Lucy.
However, he said “we are not getting any work. Things are down, down, down, so any lowering of price is still good”.
Steve Powell of Rotherley Construction also told Barbados TODAY that “in this present climate, anything helps”.
While welcoming the reduction, Executive Chairman of Innotech Services Limited Anthony Tony DaSilva said he was still “a little disappointed” that the price was not much lower.
DaSilva said he was perplexed that the FTC could describe the previous price of $42.01 as excessive and unreasonable, but yet was satisfied that the new one of $37 was reasonable.
Pointing out that moving from $22.70 per tonne to $42.01 was roughly a 90 per cent hike, the executive chairman explained that the Commission had now allowed Walkers Sand Quarry to get an estimated 70 per cent increase, based on the $37 it had settled for.
DaSilva also questioned how the price of sand in Barbados could be about three times that for the same commodity in neighbouring St Vincent & the Grenadines where Innotech also operates.
“In St Vincent, we pay Bds$11 per metric tonne,” he noted.
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