Prices of Dolomite to change only after June 2023

The current fixed price shall be valid only till 30th June 2023. The new price may be fixed by the MSPFC after review of the costs, prices, and market dynamics for dolomite and dolomite products

In a meeting that was held on December 13, 2022, the multi-sectoral price fixing committee (MSPFC) fixed the prices of dolomite, coal, and gypsum for supply to the domestic market/ industries. Following this, the price of Gypsum boulder will now be Nu 650 per metric ton (MT). Crushed gypsum in Khothakpa Gypsum Mine Stockyard, Shumar, Pemagatshel will cost Nu 1,373.08 per MT and the same from the Samdrup Jongkhar stockyard Nu 2150 per MT.

Meanwhile, the price of dolomite has been fixed at Nu 1,250 per MT. Operators and owners of industries involved in the dolomite business had been crying foul stating that dolomite rates soared after State Mining Corporation Limited (SMCL) took over dolomite mining from Jigme Mining Corporation Limited (JMCL). But Nu 1,250 per MT was claimed as the unofficial price and the domestic industries expected the committee to fix a price sooner and at a price lower than Nu 1,250 per MT. Earlier they paid Nu 100 per MT under JMCL.

Meanwhile, the Department of Geology and Mines (DGM) secretariat, which heads the MSFPC and fixes the domestic prices for the minerals said that the disparity in rates is due to the quality of dolomite supplied.

An official from DGM said, “Considering the existing information on market dynamics, cost of productions, and sales prices, fixing the price at Nu 1,250 per MT was assessed to be reasonable, feasible, and justifiable for all the parties involved.”

He added that in the past, JMCL supplied dolomite as a raw material to domestic powdering units at Nu 100 per MT as per the auction terms and conditions and to auction till the end of the operation. However, SMCL is currently supplying export quality dolomite to domestic powdering units at Nu 1,250 per MT. Additionally, the DGM also confirmed that the price fixed by MSPFC for domestic markets/industries is Nu 1,250 per MT which currently is the same as the export price of SMCL.

However, the DGM also stated that the current fixed price shall be valid only till 30th June 2023. The new price shall be fixed by the MSPFC after review of the costs, prices and market dynamics for dolomite products.

When asked why the committee took long to fix the price of the minerals for the domestic market, an official from the DGM stated that “the price of the minerals is fixed only after considering all the economic factors that best fit our country’s economy.” “Fixing the price for minerals requires detailed review and study on the market trends, cost of production and sale price of the minerals product,” he said.

 He also added that the information relating to market dynamics, cost of production and sales prices are difficult to obtain.

“Cross-verification of costs and sales from the Department of Revenue and customer (DRC) was required.

Further, he underlined that it was necessary to consider the mining costs, the cost of dolomite crushing powdering, packing, and transportation, etc, before any decision on prices was made, which took some time.

 Meanwhile, Section 28 of the Mines and Minerals Management Regulations (MMMR) 2022 mandates the Ministry to regulate the production, sale, export and import of minerals at fair market price in the domestic market. In compliance with the above sections, the Ministry constituted a Multi-sectoral Price Fixing Committee to review and fix the price of minerals sold in the domestic market.

According to the DGM, the Muti-sectoral Price Fixing Committee was instituted by the Ministry on 18 th August 2022 and immediately worked on composition of members, adoption of Term of Reference (ToR), and others. The first committee meeting was held on 13th October 2022 during which ToR has adopted and the first review of the data on costs and prices were completed. On 13th December 2022, the Committee fixed the price of dolomite for the domestic market/industry which was notified on 26th December 2022.

 Following the announcement on the prices of dolomite, coal, and gypsum from the Ministry of Economic Affairs, now known as the Ministry of Industry, Commerce and Employment (MICE) on December 26th, 2022, numerous local Industries which deal with dolomite as their raw materials are dissatisfied.

Tshering Pelden from Thimphu