A bottleneck in the national supply chain risked the cement market emptying stores and retailers last week. Shops in the Megenagna area, a hub for cement retail in Addis Abeba, were closed due to the scarce supply.

“Only two retailers’ were open in Megenagna,” a salesperson who requested anonymity said.

Those opened were selling gypsum.

According to the retailers, the shortage has been an issue for over three months. Stores were sitting idle while overhead costs caught up with them. The shops are rented for up to 40,000 Br in monthly rent in the area.

“We don’t know how long we can keep our doors open,” another store owner told Fortune.

Retailers take up to 1,000 quintals of cement a day on regular days. Prices soared to 1,800 Br for a quintal in the retail market, with distributors such as the Ethiopian Industrial Input Development Enterprise and the Ethiopian Trading Businesses Corporation supplying retailers with 1,300 Br. The distributors buy directly from factories for 770 Br and 870 Br.

“People have become idle and lost their jobs because of supply shortage,” said Zekarias Tsegaye, a truck driver who delivers cement for buyers. “It’s become challenging for me to support my family.”

Trade officials told retailers three months ago to be patient. Still, retailers had no supply last week from an industry with over 14 cement plants having an aggregate production of 8.4 million tonnes annually. Demand is estimated to have reached 12 million tonnes.

A few of the largest factories have ceased production, attributing their decision to security issues where their plants are located. For over a week, Derba Cement has stopped production. The Nigerian Dangote has also stopped supplying cement to the market following sharp disagreements with trade authorities who cap wholesale prices at factory gates.

Three months ago, authorities at the Ministry of Trade & Regional Integration (MoTRE) reintroduced price caps, compelling cement factories to sell a quintal of cement to designated distributors, increasing the value by close to 67pc. The authorities' attempt to regulate the supply chain faced a backlash and pushed retail prices to an unprecedented 1,500 Br a quintal.

Retailers blame intermediaries for playing a significant role in the dramatic rise of cement prices. Earlier this year, the Ministry’s officials attributed the shortages to the intermediaries, pledging that there is no shortage of the product.

However, the Enterprise tasked by federal authorities to distribute cement says it has not received a supply for a week.