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Competition shuts mini cement plant

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Many of the mini cement plants in Gujarat have closed down, due to internal and external competition among major players and unviable raw material costs. Major players like Ambuja, UltraTech, Sanghi, Jaypee and Digvijay have their units in Gujarat and with better strategies they have cornered the cement business. This has made small cement manufacturer unable to survive amidst competition from bigger players. Added to the woes of mini cement plants are raw material cost that have increased by at least 30-40 per cent in the past two years. As a result production costs have gone up by 30 per cent. Due to competition, there is only marginal difference of Rs 10 to 15 per bag between the product of the big plants and those from the smaller units. With the consumers preferring branded cement and slowdown in cement consumption due to lack of real estate and infrastructure projects, the mini cement owners have switched over to other businesses like real estate and engineering. Plants with capacity less than two million tonnes are classified under the mini cement plants category.

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