Cement sector to see fall in output
By Express News Service | Published: 17th September 2017 08:18 AM |
COIMBATORE: With the country’s construction industry witnessing a slowdown, production of cement is expected to remain at 70-75 per cent of installed capacity this financial year, according to M P Rawal, administrator and advisor to JK Cement.
Stating that the cement industry does not want to take risk, he pointed out that nearly 130 tonnes of cement went either unsold or unutilised. This could lead to production reducing drastically this year considering the lesser demand. The industry has a total installed capacity of close to 430 million tonnes a year in the country. Production last year (2016-2017) was about 300 million tonnes, indicating that that almost 30 per cent of capacity was not used.
“This financial year too, the capacity used so far is just 70 per cent to 75 per cent,” he told the reporters. “Our growth depends directly on construction activity. If it slows down, the cement industry also faces slow down,” said Rawal in the city to attend the 26th Edition of Architect of the Year Awards scheduled to be held on Sunday.
As far as company was concerned, of the 10.5 million tonne capacity, it may produce seven million tonne, he said, adding that the company was not selling its grey cement to Tamil Nadu in view of high transportation cost. Rawal also said that there was no proposal to set up a plant in this region, due to the availability of raw materials like lime stone.
On ever increasing prices and cartel reportedly being formed by a few cement manufacturers, Rawal said, “First of all this is a competitive industry and nobody trusts each other.. In this situation there is no truth in forming cartel to increase the prices.”
Rawal also said that the demand is picking up in India and large infrastructure projects are expected to increase demand for these products. “Investments are being made for their production,” he added.