CEMENT consumption is growing at record double-digit rates. In the Apr-Feb 06 period, cement dispatches were 127 million metric tonne showing a growth of 10.9% as compared to the previous year. The Southern and Eastern regions have shown strong consumption growth in FY06.
In the Southern region, Andhra Pradesh (37%), Tamil Nadu (16%) and Karnataka (15%) have seen a major rise in cement consumption. Chhattisgarh (52%), Bihar (18%) in the eastern region has been among the major consumption drivers for the region.
South has been the major consumption driver of cement in the country. While Central region has actually shown a decline in consumption, in the Northern region cement consumption has been strong, while in the western region cement consumption has been low. With not much of capacity likely to come till the second half of FY08, analysts expect prices in India to be firm in the coming year.
There is expected to be a substantial demand and supply mismatch of cement in the coming year. In the April-February 06 period, the incremental growth in cement consumption has matched the production. However, in the coming year there is not much of capacity addition expected, which is putting pressure on cement prices as demand growth is set to continue.
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| Posted : 4/6/2006 |
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