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EPC concept could be the future when it comes to retrofit projects

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Manoj Thakur Head – Mechanical, Penta India Cement and Minerals.

We at Penta would like to participate in the growth of our clients in cement plants by picking the right and most effective solutions for them, assures Manoj Thakur, Head – Mechanical, Penta India Cement and Minerals. Excerpts from the interview…

How important is predictive maintenance?
In the past few years, capacity utilisation of cement plants have been low in the range of 60-70 per cent. As a result, the machinery was not stressed to its maximum potential and plants also got more time to take care of breakdowns. It is expected that with the Government of India providing enough scope in infrastructure development, there will be a rise in demand. Once cement plants are pushed to achieve 90-100 per cent of their design capacities, there will be no more cushion available for unexpected breakdowns or shutdowns. This is when predictive maintenance will start playing an important role.

Indian cement industry has realised that implementing the predictive maintenance leads to a substantial increase in productivity. Concept of online monitoring is well understood and accepted by cement manufacturers wherein the state of health of a machine is known before taking it for the maintenance. In recent years, many examples of predictive maintenance have been seen, for example, many existing storage silos and structures have been taken for additional strengthening based on the results from non-destructive tests, process fans have been taken for balancing on the results from vibration monitoring tests etc. Not only major players but even medium players use regular services of consultants for carrying out predictive maintenance.

What are the challenges in retrofitting a cement plant?
The most critical challenge is that cement plant retrofits are expected to be carried out without affecting the production. In consequence, the cement players prefer technologies that require the least downtime. However, there are very few contracting agencies to take up such challenges. Another challenge is the plant layout. Many old plants were designed with no provision for the future expansion and thus retrofit projects could not be carried out. At some plants, projects were executed at huge costs for layout reasons. Though Indian cement industry is very traditional, EPC concept could be the future of it when comes to retrofit projects, keeping the existing plant in operation or with very minimum time required for the interface. Keeping pace with newer and compact technologies is essential to accommodate retrofit projects in poor layouts. This is where smart engineering comes to play.

Consulting firms like Penta excel in these niche areas and have the expertise to work out customised solutions for cement plants.

How does one decide between retrofitting and switching completely to a new system?
Penta usually assesses the potential of an existing old plant for the possibility of capacity increase before suggesting retrofit solutions. For capacity increases on a larger scale, letGC?s say doubling the plan capacity, switching to a complete new system becomes necessary. However, execution of a new cement plant has a long gestation period right from the day of conception.

There are various reasons in India taking too much time for pre-project activities including approval and procurement of land, acquisition of mines, access to coal reserves, environmental clearances, etc. Once these pre-project requirements have been met, project-related activities take their routine pace to accomplish the job. Retrofit solutions are sometimes seen as the compromise in these difficult situations.

Which type of retrofit can have greater impact on production efficiency?
Each type of retrofit, whether enhancing production efficiency, electrical, mechanical or monitoring and automation, has its respective justifications and goals. It would be unfair to compare them as they are apples and oranges. Of course, it ultimately results in improving the plant availability. Moreover, upgradation in the mechanical domain may have to combine with a retrofit in electrical and automation domain. To choose, it greatly depends on the condition and requirement of different areas i.e., mechanical, electrical and control and automation.

To achieve the benefit of a retrofit in totality, it needs to be the combination of all. A mechanical retrofit alone cannot enhance the production efficiency if existing motor control bucket, panel board or switchgear are of older designs. Likewise, retrofit for monitoring and automation are inadequate if existing machinery/equipment do not keep margin for the increased outputs. Hence, it could be advisable not to implement short-term solutions in one domain without exploring the implications in another.

How does one keep pace with the advancements in sub-systems like automation?
Cement manufacturers need to assess the need of such upgrades with a close look at their current plant availability. A balance can be achieved with regular maintenance schedules for existing equipment and opting for necessary automation upgrades. World-class suppliers develop and come up with newer technologies in automation year after year. Automation upgrades certainly help in improving the plant efficiency by various automated solutions. However, the selection of upgrades should be need based and in keeping with the capabilities of the hardware as well as the skill level of the plant personnel.

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Concrete

Lower sales realization impacts margins for cement makers in Q2 FY25

The industry encountered several challenges, including an extended monsoon season.

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Major cement manufacturers reported a decline in margins for the September quarter, primarily due to lower prices, which led to decreased sales realization.

With the exception of three leading cement producers—UltraTech Cement, Ambuja Cement, and Dalmia Bharat—smaller companies, including Nuvoco Vistas Corp, JK Cement, Birla Corporation, and Heidelberg Cement, experienced a drop in both topline and sales volume during the second quarter of the current fiscal year.

The industry encountered several challenges, including an extended monsoon season, flooding, and a slow recovery in government demand, all contributing to weak overall demand.

Despite these challenges, power, fuel, and other costs largely remained stable across the industry. The all-India average cement price was approximately Rs 348 per 50 kg bag in June 2024, which represented an 11 per cent year-on-year decrease to Rs 330 per bag in September, although it saw a month-on-month increase of 2 per cent.

In the first half of FY25, cement prices declined by 10 per cent year-on-year, settling at Rs 330 per bag. This decline was notable compared to the previous year’s average prices of Rs 365 per bag and Rs 375 per bag in FY23, as reported by Icra.

Leading cement manufacturer UltraTech reported a capacity utilization rate of 68 per cent, with a 3 per cent growth in volume. However, its sales realization for grey cement declined by 8.4 per cent year-on-year and 2.9 per cent quarter-on-quarter during the July-September period.

In response to a query regarding cement prices during the earnings call, UltraTech’s CFO Atul Daga indicated that there had been an improvement in prices from August to September and noted that prices remained steady from September to October. He mentioned that the prices had risen from Rs 347 in August to approximately Rs 354 currently.

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Concrete

Steel companies face Rs 89,000 crore inventory crisis

Steel firms grapple with Rs 89,000 crore stockpile amid import surge.

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Steel companies in India are facing a significant challenge as they contend with an inventory crisis valued at approximately Rs 89,000 crore. This situation has arisen due to a notable increase in steel imports, which has put pressure on domestic producers struggling to maintain sales in a competitive market.

The surge in imports has been fueled by various factors, including fluctuations in global steel prices and increased production capacities in exporting countries. As a result, domestic steel manufacturers have found it difficult to compete, leading to rising stock levels of unsold products. This inventory buildup has forced several companies to reassess their production strategies and pricing models.

The financial impact of this inventory crisis is profound, affecting cash flows and profitability for many steel firms. With domestic demand remaining volatile, the pressure to reduce prices has increased, further complicating the situation for manufacturers who are already grappling with elevated production costs.

Industry experts are urging policymakers to consider measures that can support local steel producers, such as imposing tariffs on imports or enhancing trade regulations. This would help to protect the domestic market and ensure that Indian steel companies can compete more effectively.

As the steel sector navigates these challenges, stakeholders are closely monitoring the situation, hoping for a turnaround that can stabilize the market and restore confidence among investors. The current dynamics emphasize the need for a robust strategy to bolster domestic production and mitigate the risks associated with excessive imports.

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Concrete

JSW and POSCO collaborate for steel plant

JSW Group and POSCO ink MoU for steel project.

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JSW Group has signed a Memorandum of Understanding (MoU) with South Korea’s POSCO Group to develop an integrated steel plant in India. This collaboration aims to enhance India’s steel production capacity and contribute to the country’s growing manufacturing sector.

The agreement was formalized during a recent meeting between executives from both companies, highlighting their commitment to sustainable development and technological innovation in the steel industry. The planned facility will incorporate advanced manufacturing processes and adhere to environmentally friendly practices, aligning with global standards for sustainability.

JSW Group, a leader in the Indian steel industry, has expressed confidence that the joint venture with POSCO will bolster its position in the market and accelerate growth. The project is expected to attract significant investments, generating thousands of jobs in the region and contributing to local economies.

As India aims to boost its steel output to meet domestic demand and support infrastructure projects, this partnership signifies a crucial step toward achieving those goals. Both companies are committed to leveraging their expertise to develop a state-of-the-art facility that will produce high-quality steel products while minimizing environmental impact.

This initiative also reflects the increasing collaboration between Indian and international firms to enhance industrial capabilities and foster economic growth. The MoU sets the stage for a promising future in the Indian steel sector, emphasizing innovation and sustainability as key drivers of success.

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