Economy & Market
Journey from commodity to brand
Published
5 years agoon
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admin
For long, cement is regarded as commodity but off late, it is treated as a "Brand". This has not happened overnight but it is an interesting journey. We take our readers through this historical migration that is still happening.
Indian cement industry is characterised by the co-existence of both large manufacturers (national players) as well as small players (regional players). Presently there are more than 65 cement manufacturers in the country. However, the big companies- UltraTech, ACC and Ambuja Cement – together have 44.2 per cent of the industry capacity. It should be noted that in FY2008, their share was just 34.3 per cent. However, these big companies may have to cede some ground by 2021 when their share will see a slight fall to 42.4 per cent due to capacity expansion by others. In last 10 years, cement manufacturing capacity has more than doubled, which is mainly due to strong demand the industry had experienced till FY 2012.
Commodity
Cement is a commodity as vital to fast-growing economies as oil or steel, fertiliser. Some say, uniqueness of the Indian market has made cement producers act a lot like makers of consumer products. Market pressure and consumer structure have pushed major cement players in the country to start investing into more than just making their product strong and efficient. They are now adding personality to the construction material, by building brands around it. And they are doing it by the rules of consumer marketing. The outcome can only be interesting. All over the world major quantity of cement is distributed in the bulk mode and very little goes through bags. However many thinkers have expressed that in India the quantity distributed through bulk is going to increase but what goes through bags will be a significant volume which the producers can’t ignore.
Why a sack of cement is worth more for the customer? Why he thinks the product offered to him is better than others? In short the product when goes as a brand to him must have enhanced value, not just through advertisements but in the real sense. Normally in retail cement market, the buying decision is taken by contractors, middleman or mason. Let us now take a few interesting cases.
Ambuja
Ambuja Cement is a multi-region cement manufacturing company. The company has significant presence in northern, western and eastern regions. The company does not have cement capacities in the southern and central regions. About 85 per cent of its sales come from retail segment. The company is expanding its cement capacity by 3.1 MTPA in Marwar which is scheduled for commissioning in FY 20-21.
It is Ambuja, in the year 1983 set up a plant for manufacturing 0.7 MT cement on the western coast and started selling cement. It realised the potential of Mumbai market for retail business and came with an idea of "giant compressive strength". Sooner many other cement companies and even today all new launches are centred on compressive strength of cement. However due credit must be given to Ambuja for capitalising on the strength attribute of a cement. Ambuja soon focused on various means like good advertisement, handsome returns to retailers and fulfilling all other expectations of a cement seller. Then came the gradation of cement, like 43,53 etc. and further was the buzzword ISO 9002. Every where Ambuja scored much better than the existing players. The others had to simply follow what Ambuja was doing.
Talking about the advertisements, we would like to mention a few exceptions like ACC, Shree and JSW, which have never used strength of cement as an attribute in their advertisements. ACC follows an approach of a single mother brand, being one of the oldest cement companies. On the other hand, even today a majority of cement producers create their advertisements only around strength. There are many other attributes of cement, which a creative advertiser is yet to find out. Shree cement is yet another exception.
While talking about the strength of cement, what users expect is a consistent level of strength for batches after batches supplied to him. Giving one time high strength is not a big deal. We can quote here the case of L&T Cement when being sold as brand L&T that had a very high reputation of consistent strength, which even many users acknowledge today. A good number of staff who worked then at L&T and are now part of UltraTech. It was also a very credible brand among cement traders for its fair dealings. While launching UltraTech as a brand, Kumar Mangalam Birla, Chairman AVB Group expressed the optimism that "UltraTech Cement will resonate with buyers in just the way L&T Cement did. Nothing has changed except the name. What was L&T Cement becomes UltraTech Cement". This clearly indicates that he acknowledged the brand value of L&T. There is no wonder, among all the institutional buyers L&T was the most favoured brand for a very long time. The name UltraTech itself has resemblance with L&T and has a tagline "The Engineers" Choice
. Today UltraTech is the largest selling brand in the country that is closely watched by every cement user.
Lafarge story
About 65 per cent of cement is used by individual house builder and around 19 to 20 per cent is infrastructural demand. Lafarge India has launched its premium cement brand, Lafarge Concreto. Lafarge was then the cement market leader in eastern India with a market share of 20 per cent followed by Grasim and Ultratech with 17 per cent. Concreto is reportedly superior quality cement that helped in building better structures that last longer, a consulting civil engineer said.
Cement accounts for about 15 per cent of the total construction cost of a typical house. Though Concreto was priced higher than the normal Lafarge cement, its superior quality and increased durability would more than compensate the increase in cement cost, he said. Concreto was 5 ruppes costlier than other variants.Today the brand has gone to Nuvoco.
Packaging of cement
When cement started selling as a brand, the first innovation that happened was paper packing. To give a premium status to the product, many companies started supplying cement in paper bags especially 53 Grade in good olden days. The higher price could neutralise for the increased cost of paper. However paper packing had its own problems like more handling charges, higher bursting rate while packing and controlled conditions for storing stock of paper bags. The production rate of packing was required to be compromised therefore it was not sustainable.
The other innovation came with 25 kg bag instead of normal 50 kg packing. However this also did not last because production rate was simply halved given the same packing machine. The recent innovation has been polypropylene laminated bags. These are costlier and better looking bags with multi-colour printing option. This innovation is still under observation and yet to accepted fully. So far the practise has been to source the packing material from outside the plant however few cement companies have invested in producing their own packing bags.
We must mention here what has been happened in the segment of white cement, the product always enjoys an elite status over grey cement. The use of cement being very restricted it was many times sold loose for limited application by a retailer. The smart marketing officers saw a potential here and both Birla White and JK Cement introduced 1 kg and 5 kg pack for white cement which instantly became a success. In terms of profit for the companies, these product baskets have been giving highest earnings. The extension to white cement has been "Wall Care Putties." This value added product is giving handsome returns on investments.
Networking
Networking with engineering fraternity and user community is a very important aspect of brand building exercise. Cement being an intermediate product always converted into some other form. E.g it is converted into concrete or plaster mortar. The role played by consulting engineers is extremely important here. On the strength parameters, L&T was extremely consistent, which was proved to engineering community by providing standard deviation values drawn over a period of time. The engineers are required to use these values in designing concrete mixes. In case of any decorative applications role of an architect is vital. Therefore white cement producers are well connected with architects. Flooring, plastering are other applications of cement where architects have a say.
The other important agency that play a crucial role is mason who uses the cement with his own hands. Generally a retail buyer of cement will not displease the mason who is working for him. Cement companies organise mason meets regularly but after some time these turn out to be monotonous and gift distribution event. Some kind of innovation if can be brought to mason meets then it will be a very useful forum for spreading a message. Retailer of cement is another channel partner who has a role to play. Schemes worked out for retailers are parallel to what are run by FMCG companies. These have to be consistent and transparent in execution. Retailer always compares the schemes offered by different companies and chooses the one best suited for him.
Commodity vs. product (Brand)
- A commodity is a raw material used in the production process to manufacture
- finished goods, while a product is a finished goods sold to consumers
- No value is added to a commodity, which can be grown, extracted, or mined
- Commodities are traded on exchanges through futures contracts, stocks, and ETFs, and can also be bought and sold in their physical states
- Products are sold on the market for consumption by the average consumer and can also be found in investment portfolios.
Guide to brand building:
- Make your brand as unique as possible
- Quickly globalise brand and its products
- Brand is an investment and not cost
- Reward customers involvement and make them active promoters of your brand
- Encourage communities that share your values
- Donations to good causes to prove that brand is sensitive to the world around
- Sponsorship to a good cause or an event
- Service associated with a brand
- Don’t overload customers with too much of technical data and literature
- Speak the language, the customer understands
- Interaction with customers at regular intervals
– VIKAS DAMLE
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Walplast Products, a leading manufacturer of building and construction materials, has unveiled the expansion of its esteemed HomeSure MasterTouch portfolio with the launch of the new HomeSure MasterTouch Lush (Interior & Exterior Emulsion) and HomeSure MasterTouch Prime (Interior & Exterior Primer). These new offerings are strategically positioned as high-quality, yet affordable, high-performance solutions designed to enable individuals to achieve their dream of beautiful homes and “Elevating Lifestyles” (Raho Shaan Se).
The HomeSure MasterTouch Lush Interior Emulsion is a high-quality yet affordable wall paint that delivers best-in-class coverage and an aesthetically appealing, durable finish. Formulated with premium pigments and acrylic binders, it ensures excellent coverage, colour retention, and resistance to fungus, making it an ideal choice for homeowners seeking durability and value. Meanwhile, the HomeSure MasterTouch Lush Exterior Emulsion is specifically engineered to withstand varying weather conditions, particularly in regions with frequent rain and moderate humidity. With strong adhesion and UV-resistant properties, it protects exterior walls against algae growth and black spots while maintaining an elegant matte appearance.
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“At Walplast, we are committed to providing innovative and accessible solutions that enhance the beauty and longevity of homes. The HomeSure MasterTouch range is designed with the modern homeowner in mind—delivering affordability without compromising on quality. Our focus is to empower individuals to bring their dream homes to life with reliable and superior products,” said Kaushal Mehta, Managing Director of Walplast.
Aniruddha Sinha, Senior Vice President Marketing, CSR, and Business Head – P2P Division, Walplast added, “The HomeSure MasterTouch Lush and Prime range align with our vision of offering peace of mind to customers with durable, aesthetic, and affordable solutions for every home. The “Elevate your lifestyle” reflects our belief that everyone deserves to live in a home they take pride in. With this launch, we continue our mission of enabling dreams of beautiful homes for all.”
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Carbon Capture, Utilisation, and Storage (CCUS) is crucial for reducing emissions in the cement industry. Kanika Mathur explores how despite the challenges such as high costs and infrastructure limitations, CCUS offers a promising pathway to achieve net-zero emissions and supports the industry’s sustainability goals.
The cement industry is one of the largest contributors to global CO2 emissions, accounting for approximately seven to eight per cent of total anthropogenic carbon dioxide released into the atmosphere. As the world moves towards stringent decarbonisation goals, the cement sector faces mounting pressure to adopt sustainable solutions that minimise its carbon footprint. Among the various strategies being explored, Carbon Capture, Utilisation, and Storage (CCUS) has emerged as one of the most promising approaches to mitigating emissions while maintaining production efficiency. This article delves into the challenges, opportunities, and strategic considerations surrounding CCUS
in the cement industry and its role in achieving net-zero emissions.
Understanding CCUS and Its Relevance to Cement Manufacturing
Carbon Capture, Utilisation, and Storage (CCUS) is an advanced technological process designed to capture carbon dioxide emissions from industrial sources before they are released into the atmosphere. The captured CO2 can then be either utilised in various applications or permanently stored underground to prevent its contribution to climate change.
Rajesh Kumar Nayma, Associate General Manager – Environment and Sustainability, Wonder Cement says, “CCUS is indispensable for achieving Net Zero emissions in the cement industry. Even with 100 per cent electrification of kilns and renewable energy utilisation, CO2 emissions from limestone calcination—a key raw material—remain unavoidable. The cement industry is a major contributor to
GHG emissions, making CCUS critical for sustainability. Integrating CCUS into plant operations ensures significant reductions in carbon emissions, supporting the industry’s Net Zero goals. This transformative technology will also play a vital role in combating climate change and aligning with global sustainability standards.”
The relevance of CCUS in cement manufacturing stems from the inherent emissions produced during the calcination of limestone, a process that accounts for nearly 60 per cent of total CO2 emissions in cement plants. Unlike other industries where CO2 emissions result primarily from fuel combustion, cement production generates a significant portion of its emissions as an unavoidable byproduct. This makes CCUS a particularly attractive solution for the sector, as it offers a pathway to drastically cut emissions without requiring a complete overhaul of existing production processes.
According to a Niti Ayog report from 2022, the adverse climatic effects of a rise in GHG emissions and global temperatures rises are well established and proven, and India too has not been spared from adverse climatic events. As a signatory of the Paris Agreement 2015, India has committed to reducing emissions by 50 per cent by the year 2050 and reaching net zero by 2070. Given the sectoral composition and sources of CO2 emissions in India, CCUS will have an important and integral role to play in ensuring India meets its stated climate goals, through the deep decarbonisation of energy and CO2 emission intensive industries such as thermal power generation, steel, cement, oil & gas refining, and petrochemicals. CCUS can enable the production of clean products while utilising our rich endowments of coal, reducing imports and thus leading to an Indian economy. CCUS also has an important role to play in enabling sunrise sectors such as coal gasification and the nascent hydrogen economy in India.
The report also states that India’s current cement production capacity is about 550 mtpa, implying capacity utilisation of about 50 per cent only. While India accounts for 8 per cent of global cement capacity, India’s per capita cement consumption is only 235 kg, and significantly low compared to the world average of 500 kg per capita, and China’s per capita consumption of around 1700 kg per capita. It is expected that domestic demand, capacity utilisation and per capita cement consumption will increase in the next decade, driven by robust demand from rapid industrialisation and urbanisation, as well as the Central Government’s continued focus on highway expansions, investment in smart cities, Pradhan Mantri Awas Yojana (PMAY), as well as several state-level schemes.
Key Challenges in Integrating CCUS in Cement Plants Spatial Constraints and Infrastructure Limitations
One of the biggest challenges in integrating CCUS into existing cement manufacturing facilities is space availability. Most cement plants were designed decades ago without any consideration for carbon capture systems, making retrofitting a complex and costly endeavour. Many facilities are already operating at full capacity with limited available space, and incorporating additional carbon capture equipment requires significant modifications.
“The biggest challenge we come across repeatedly is that most cement manufacturing facilities were built decades ago without any consideration for carbon capture systems. Consequently, one of the primary hurdles is the spatial constraints at these sites. Cement plants often have limited space, and retrofitting them to integrate carbon capture systems can be very challenging. Beyond spatial issues, there are additional considerations such as access and infrastructure modifications, which further complicate the integration process. Spatial constraints, however, remain at the forefront of the challenges we encounter” says Nathan Ashcroft, Carbon Director, Stantec.
High Capital and Operational Costs CCUS technologies are still in the early stages of large-scale deployment, and the costs associated with implementation remain a significant barrier. Capturing, transporting, and storing CO2 requires substantial capital investment and increases operational expenses. Many cement manufacturers, especially in developing economies, struggle to justify these costs without clear financial incentives or government support.
Regulatory and Policy Hurdles The regulatory landscape for CCUS varies from region to region, and in many cases, clear guidelines and incentives for deployment are lacking. Establishing a robust framework for CO2 storage and transport infrastructure is crucial for widespread CCUS adoption, but many countries are still in the process of developing these policies.
Waste Heat Recovery and Energy Optimisation in CCUS Implementation
CCUS technologies require significant energy inputs, primarily for CO2 capture and compression. One way to offset these energy demands is through the integration of waste heat recovery (WHR) systems. Cement plants operate at high temperatures, and excess heat can be captured and converted into usable energy, thereby reducing the additional power required for CCUS. By effectively utilizing waste heat, cement manufacturers can lower the overall cost of carbon capture and improve the economic feasibility of CCUS projects.
Another critical factor in optimising CCUS efficiency is pre-treatment of flue gases. Before CO2 can be captured, flue gas streams must be purified and cleaned to remove particulates and impurities. This additional processing can lead to better capture efficiency and lower operational costs, ensuring that cement plants can maximise the benefits of CCUS.
Opportunities for Utilising Captured CO2 in the Cement Sector
While storage remains the most common method of handling captured CO2, the utilising aspect presents an exciting opportunity for the cement industry. Some of the most promising applications include:
Carbonation in Concrete Production
CO2 can be injected into fresh concrete during mixing, where it reacts with calcium compounds to form solid carbonates. This process not only locks away CO2 permanently but also enhances the compressive strength of concrete, reducing the need for additional cement.
Enhanced Oil Recovery (EOR) and Industrial Applications
Captured CO2 can be used in enhanced oil recovery (EOR), where it is injected into underground oil reservoirs to improve extraction efficiency. Additionally, certain industrial processes, such as urea production and synthetic fuel manufacturing, can use CO2 as a raw material, creating economic opportunities for cement producers.
Developing Industrial Hubs for CO2 Utilisation
By co-locating cement plants with other industrial facilities that require CO2, manufacturers can create synergies that make CCUS more economically viable. Industrial hubs that facilitate CO2 trading and re-use across multiple sectors can help cement producers monetise their captured carbon, improving the financial feasibility of CCUS projects.
Strategic Considerations for Large-Scale CCUS Adoption Early-Stage Planning and Feasibility Assessments
Cement manufacturers looking to integrate CCUS should begin with comprehensive feasibility studies to assess site-specific constraints, potential CO2 storage locations, and infrastructure requirements. A phased implementation strategy, starting with pilot projects before full-scale deployment, can help mitigate risks and optimise
system performance.
Neelam Pandey Pathak, Founder and CEO, Social Bay Consulting and Rozgar Dhaba says, “Carbon Capture, Utilisation and Storage (CCUS) has emerged as a transformative technology that holds the potential to revolutionise cement manufacturing by addressing its carbon footprint while supporting global sustainability goals. CCUS has the potential to be a game-changer for the cement industry, which accounts for about seven to eight per cent of global CO2 emissions. It addresses one of the sector’s most significant challenges—emissions from clinker production. By capturing CO2 at the source and either storing it or repurposing it into value-added products, CCUS not only reduces
the carbon footprint but also creates new economic opportunities.”
Government Incentives and Policy Support
For CCUS to achieve widespread adoption, governments must play a crucial role in providing financial incentives, tax credits, and regulatory frameworks that support carbon capture initiatives. Policies such as carbon pricing, emission reduction credits, and direct subsidies for CCUS infrastructure can make these projects more economically viable for cement manufacturers.
Neeti Mahajan, Consultant, E&Y India says, “With new regulatory requirements coming in, like SEBI’s Business Responsibility and Sustainability Reporting for the top 1000 listed companies, value chain disclosures for the top 250 listed companies, and global frameworks to reduce emissions from the cement industry – this can send stakeholders into a state of uncertainty and unnecessary panic leading to a semi-market disruption. To avoid this, communication on technologies like carbon capture utilisation and storage (CCUS), and other innovative tech technologies which will pave the way for the cement industry, is essential. Annual reports, sustainability reports, the BRSR disclosure, and other broad forms of communication in the public domain, apart from continuous stakeholder engagement internally to a company, can go a long way in redefining a rather traditional industry.”
The Role of Global Collaborations in Scaling CCUS
International collaborations will be essential in driving CCUS adoption at scale. Countries that have made significant progress in CCUS, such as Canada, Norway, and the U.S., offer valuable insights and technological expertise that can benefit emerging markets. Establishing partnerships between governments, industry players, and research institutions can help accelerate technological advancements and facilitate knowledge transfer.
Raj Bagri, CEO, Kapture, says “The cement industry can leverage CCUS to capture process and fuel emissions and by using byproducts to replace existing carbon intensive products like aggregate filler or Portland Cement.”
Organisations like the Carbon Capture Knowledge Centre in Saskatchewan provide training programs and workshops that can assist cement manufacturers in understanding CCUS implementation. Additionally, global symposiums and industry conferences provide platforms for stakeholders to exchange ideas and explore collaborative opportunities.
According to a Statista report from September 2024, Carbon capture and storage (CCS) is seen by many experts as a vital tool in combating climate change. CCS technologies are considered especially important for hard-to-abate industries that cannot be easily replaced by electrification, such as oil and gas, iron and steel, and cement and refining. However, CCS is still very much in its infancy, capturing just 0.1 per cent of global CO2 emissions per year. The industry now faces enormous challenges to reach the one billion metric tons needing to be captured and stored by 2030 and live up to the hype.
The capture capacity of operational CCS facilities worldwide increased from 28 MtCO2 per year in 2014 to around 50 MtCO2 in 2024. Meanwhile, the capacity of CCS facilities under development or in construction has risen to more than 300 MtCO2 per year. As of 2024, the United States had the largest number of CCS projects in the pipeline, by far, with 231 across various stages of development, 17 of which were operational. The recent expansion of CCS has been driven by developments in global policies and regulations – notably the U.S.’ Inflation Reduction Act (IRA) – that have made the technology more attractive to investors. This has seen global investment in CCS more than quadruple since 2020, to roughly $ 11 billion in 2023.
The Future of CCUS in the Cement Industry
As technology advances and costs continue to decline, CCUS is expected to play a crucial role in the cement industry’s decarbonisation efforts. Innovations such as cryogenic carbon capture and direct air capture (DAC) are emerging as promising alternatives to traditional amine-based systems. These advancements could further enhance the feasibility and efficiency of CCUS in cement manufacturing.
In conclusion, while challenges remain, the integration of CCUS in the cement industry is no longer a question of “if” but “when.” With the right mix of technological innovation, strategic planning, and policy support, CCUS can help the cement sector achieve net zero emissions while maintaining its role as a vital component of global infrastructure development.

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