HomeNewsCement prices decline further in September

Cement prices decline further in September

Pricing weakness seen in August when prices corrected almost by 3-4% continued in September too due to an extended Monsoon in some parts of the country. As a result, prices corrected, on all India basis, by about 1.5-2%. Apart from the Monsoon, higher COVID-19 cases in some states, such as Kerala, lower availability of sand, increased farming activities and the ongoing & inauspicious Pitru Paksha were region-specific issues resulting in soft demand.

In East India, Bihar, Jharkhand and Odisha saw price cuts of Rs 5 per bag each, followed by Rs 10 per bag fall in West Bengal while in Chhattisgarh it remained largely flat MoM. However, in October Chhattisgarh may see spike in cement prices as transporters, after March, have once again gone on strike demanding increased rates. Dealers expect at least Rs 20/bag increase in prices in the state during October.

In North region, Punjab and Rajasthan saw largely flat trend but prices in Delhi were up by Rs 5 per bag. In Southern region manufacturers tried to hike prices in September but only to be rolled back subsequently. In fact, prices went down further by Rs 5-20/bag MoM basis. While prices in Karnataka were down Rs 5 per bag, Andhra Pradesh and Telangana saw price cuts of Rs 10 per bag each. In Kerala and Tamil Nadu prices fell by Rs 15-20 per bag each.

West saw flat to minor decline in prices during September. While price remained relatively flat in Mumbai, other centres in Maharashtra saw price decline of Rs 10/bag. In Central India, prices were flat in Uttar Pradesh but Madhya Pradesh witnessed price correction of Rs 5 per bag.

In October, cement manufacturers are likely to go for price hikes to take advantage of festive season demand. Also, sustained increase in the cost due to elevated price level of fuel and pet coke will also force them for a price hike. However, sustainability of the price at higher level will largely depend upon early withdrawal of Monsoon, revival of construction activities and containment of the pandemic.

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