The cement consumption and pricing that went down late last year have started to climb up and a bag of the construction material, which is presently available in retail at Rs.225 could soon go up to Rs.240.
Though the real estate has been badly affected due to various reasons in the last year or so, industry sources point out that cement consumption has not been impacted that badly due to this. The average consumption did take a nosedive during September-December 2009, but the causative factors for this were entirely different and not related to the troubled times faced by the real estate.
Infrastructure work in the form of roads, school buildings, primary health centres and even those related to agriculture related infrastructure such as godown and storage facilities do take away a chunk of the cement production. However, in the wake of political uncertainty that prevailed after the helicopter crash leading to the death of the then Chief Minister Y.S.Rajasekhara Reddy, these works too were affected for nearly four months.
According to the industry, the cement consumption in the State went down to 15.50 lakh tonnes during September 2009 and as the political situation began to resolve, registered an incremental growth.
Thus if November saw the consumption rise to 18.50 lakh tonnes, it was 21 lakh tonnes in January, 2010, and primary figures for March look at crossing 23.50 lakh tonnes.
The pricing per bag too had gone down during the period and touched Rs.140 in September and the same took the upward curve to touch present Rs.225 in the city.
“The prices are poised to go up a bit and could touch Rs.240 soon,” says a leading figure of the industry. The installed capacity in the State is put around 36 to 40 million tonnes per year.
The price varies in different parts of the State depending upon transportation cost and demand there. Accordingly, if the retail price per bag in the city and Vijayawada is Rs.225, then the same is around Rs.250 in Srikakulam and Chittoor.
Keywords: Cement prices