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Growth and Equilibrium

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Ujjwal Parwal, Director and Founder, RationalStat, underscores the importance of a balance between economic growth and sustainability, as the cement industry takes the challenge of technology and innovation head on.

Emphasising the critical role of a well-established infrastructure network in the pursuit of India’s ambitious US$ 5 trillion economic targets, India is making substantial investments in large-scale projects aimed at bolstering economic resilience and unlocking new avenues for investments. India is experiencing rapid growth through improved connectivity, enhanced logistics, and the initiation of residential and commercial projects to meet both present and future needs. Key development projects like the Bharatmala project, Delhi-Mumbai Industrial Corridor, PM Gati Shakti and others are driving this growth.
However, this expansion of infrastructure is taking place against a backdrop of increasing concerns about climate change, making it essential to strike a balance between economic development and sustainability. Cement, a critical component of all infrastructure projects and the foundation of construction is poised to experience a significant surge in demand. Achieving the right equilibrium between economic growth and sustainability necessitates the incorporation of innovation and technology to make the cement manufacturing process more environmentally friendly.

Market Scenario
Between 2012 and 2023, the installed cement production capacity grew by 61 per cent to 570 MT from 353 MT. The Indian cement sector’s capacity is expected to expand at a compound annual growth rate (CAGR) of 4-5 per cent over the five-year period up to the end of 2028. The expected cement production capacity in 2028 will be nearly 720 MT. In addition, India’s cement production in 2024 is expected to grow by 7-8 per cent driven by infrastructure-led investment and mass residential projects. Cement consumption in India grew at a considerable CAGR of 5.7 per cent from 2016 to 2022. As per RationalStat research reports, the Indian cement industry is likely to add 82 million tonnes by 2024, the highest in the last 10 years, driven by increasing spending on housing and infrastructure activities. Cement consumption is expected to reach 480 million tonnes by the end of 2028.

Challenges and Opportunities
At present, India is witnessing significant infrastructure development, with a concurrent rise in housing demand. Consequently, Moody’s predicts that cement production in India will increase by approximately 6-8 per cent over fiscal years 2023 and 2024. The housing sector, which typically accounts for 60-65 per cent of India’s cement consumption, remains a central driver of demand. Therefore, the challenge lies in enhancing the cleanliness, efficiency and sustainability of the cement manufacturing process through innovation and technology.
India is the second largest producer of cement in the world, and the cement sector is a major contributor to the country’s greenhouse gas (GHG) emissions. However, the Indian cement industry is also taking steps to reduce its environmental impact through the adoption of new technologies. The cement industry is one of the largest industrial emitters of greenhouse gases (GHGs), accounting for around 7 per cent of global CO2 emissions. This is due to the energy-intensive process of cement production, which involves heating limestone and clay to over 1400 degrees Celsius.
The shift towards sustainable cement manufacturing is also pressing, given that cement production is one of the highest-emitting industries globally, contributing to 7 per cent of global CO2 emissions. It is one of the most widely used products worldwide, with applications ranging from residential to urban construction, making it indispensable for societal progress. Hence, swift adoption of sustainable practices is necessary to mitigate environmental impact and contribute to achieving sustainability targets, such as India’s goal of becoming carbon-neutral by 2070.

Role of Technology
Incorporating innovation and technology is the key to making cement production in India more environmentally friendly. Cement manufacturers must play a dual role by supporting India’s economic growth by meeting cement demand and contributing to the sustainability mission by ensuring minimal environmental impact of cement production. Strategies may include the integration of waste heat recovery systems to meet energy demands sustainably, reducing electricity requirements, investing in high-efficiency coolers and preheaters to minimise kiln heat requirements and transitioning to clean energy sources like solar or wind energy.

The Road Ahead
Cement manufacturers can also explore waste-to-fuel conversion processes and the implementation of carbon capture, utilisation and storage methods, which involve capturing CO2 emissions and either storing them or using them to produce chemicals, concrete or plastics, thereby promoting a circular economy.

Cement plants must use digitalisation and
technological advancement, accelerating the
adoption of technologies such as robotics, artificial
intelligence, IoT, data analytics and other innovations
to expedite sustainability efforts like process
optimisation, higher efficiency, enhanced visibility
and control over operations


Here are some cement producers in India with sustainability goals:
UltraTech Cement: UltraTech Cement is committed to reducing its carbon footprint and increasing its use of renewable energy. The company has set a target to reduce its CO2 emissions by 33 per cent by 2030. UltraTech Cement is also investing in waste heat recovery systems and geopolymer concrete.
Dalmia Bharat Cement: Dalmia Bharat Cement has set a target to achieve net-zero emissions by 2040. The company is investing in carbon capture and storage (CCS) technologies, waste heat recovery systems, and renewable energy. Dalmia Bharat Cement is also using supplementary cementitious materials (SCMs) to reduce the clinker content of cement.
Shree Cement: Shree Cement is committed to reducing its environmental impact and promoting sustainable development. The company has set a target to reduce its water consumption by 20 per cent by 2030. Shree Cement is also investing in renewable energy and waste management.
Ambuja Cements: Ambuja Cements is committed to reducing its carbon footprint and promoting sustainable development. The company has set a target to increase its use of renewable energy to 25 per cent by 2030. Ambuja Cements is also investing in waste heat recovery systems and geopolymer concrete.
ACC Limited: ACC Limited is committed to reducing its environmental impact and promoting sustainable development. The company has set a target to reduce its carbon footprint by 33 per cent by 2030. ACC Limited is also investing in renewable energy and water conservation.
These are just a few examples of cement producers in India with sustainability goals. Many other cement companies in India are also taking steps to reduce their environmental impact and promote sustainable development. In addition to the companies listed above, a number of startups in India are also working to develop and commercialise sustainable cement technologies.
One of the most effective ways to reduce GHG emissions from cement production is to improve energy efficiency. This can be done by using more efficient kilns, preheaters, and other equipment.
For example, some cement companies are now using waste heat recovery systems to capture heat from the kiln and use it to generate electricity or preheat the raw materials. Others are using alternative fuels, such as biomass, to reduce their reliance on fossil fuels.
Reducing clinker content: Clinker is the main component of cement, and it is also the most energy-intensive to produce. By reducing the clinker content of cement, cement companies can significantly reduce their GHG emissions.
One way to reduce clinker content is to use supplementary cementitious materials (SCMs), such as fly ash, slag, and silica fume. SCMs are industrial waste products that can be used to replace a portion of the clinker in cement without sacrificing performance.
Another way to reduce clinker content is to use new cement formulations. For example, some cement companies are now developing low-carbon cement that uses less clinker and more SCMs.
Capturing and storing carbon emissions: Carbon capture and storage (CCS) is a technology that can be used to capture carbon dioxide emissions from industrial processes and store them underground. CCS is a key technology for achieving net-zero emissions in the cement industry.
A number of cement companies are currently piloting and deploying CCS technologies. For example, HeidelbergCement is developing a CCS project at its Nordkalk plant in Finland. The project is expected to capture and store over 800,000 tonnes of CO2 per year once it is operational.
The geopolymer concrete market in India is in its early stages of development, but it is growing rapidly. The Indian government’s support for geopolymer concrete products is likely to boost the growth of the market in the coming years.

Geopolymer concrete products have a number of benefits over traditional concrete products, including a lower carbon footprint, increased durability, and improved performance. Geopolymer concrete products can be used in a wide range of applications, including construction, precast products, refractory materials, and soil stabilisation.
For example, FlyAsh Solutions and Geopolymer Solutions are developing and manufacturing geopolymer concrete products.
The Indian cement industry is taking steps to reduce its environmental impact and promote sustainable development. By adopting new technologies and investing in renewable energy, the Indian cement industry can play a leading role in driving global sustainability.

Driving Sustainability
Technology is playing a vital role in driving sustainability in the cement sector. Cement companies are investing heavily in new technologies to improve energy efficiency, reduce clinker content and capture and store carbon emissions.
In the face of growing demand, the cement industry is at a pivotal juncture where it must address environmental concerns associated with manufacturing, including reducing energy consumption, emissions, and increasing sustainability. The industry must emerge as a key contributor to creating a cleaner and greener future by leveraging innovation and technology to help India achieve its sustainable development goals more rapidly.

ABOUT THE AUTHOR:
Ujjwal Parwal, Director and Founder, RationalStat,
has over 10 years of industry experience in global market research and procurement intelligence. HE is a skilled market researcher and helps growth-driven organisations and entrepreneurs understand market entry prospects, and industry assessment, and grow their revenue strategically.

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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