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The Future of Cement Movement

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Logistics, from the factory exit point to the last mile connectivity, is a key driver of efficiency and cost optimisation in the cement industry. With digitalisation, multi-modal integration and sustainability, logistics is the differentiator that will give the manufacturer a competitive advantage. Let us explore how logistics has today become a deciding factor that players cannot afford to ignore.

India, the second-largest cement producer globally, has an installed capacity exceeding 600 million tonnes per annum, with demand driven by infrastructure, housing, and urbanisation (IBEF, 2024). However, logistics remains one of the most significant cost components, accounting for nearly 20 to 30 per cent of the total cement cost, primarily due to the bulk nature and low value-to-weight ratio of the product (Cement Manufacturers’ Association, 2023; McKinsey, 2022).
With over 70 per cent of cement transported via road, inefficiencies in logistics directly impact profitability, delivery timelines, and customer satisfaction (NITI Aayog, 2021). As supply chains grow more complex, end-to-end logistics is emerging as a critical lever for cost optimisation, operational efficiency, and competitive advantage.

Logistics: The game changer
Logistics plays a central role in the cement industry, where timely delivery and cost efficiency are key determinants of market competitiveness. Unlike many other industries, cement has a low shelf value relative to its transportation cost, making logistics optimisation critical. According to McKinsey (2022), logistics costs in cement can reach up to 30 per cent of total production costs, significantly higher than global manufacturing averages. This underscores the importance of efficient distribution networks in maintaining margins and ensuring consistent supply.
Moreover, logistics directly influences market reach and dealer satisfaction. Cement companies with optimised logistics networks can ensure faster delivery cycles, improved availability, and better service levels. A report by Deloitte (2023) highlights that companies focusing on logistics optimisation have seen improvements of up to 15 per cent to 20 per cent in delivery efficiency, reinforcing the role of logistics as a strategic differentiator rather than just an operational function.

Mapping the cement supply chain
The cement supply chain is complex and involves multiple stages, including raw material transportation, clinker movement, cement production, warehousing, and final distribution to dealers and project sites. Each stage requires careful coordination to minimise delays and costs. According to World Cement Association (2023), inefficiencies in supply chain coordination can lead to 5 per cent to 8 per cent losses in overall operational efficiency, highlighting the need for integrated logistics planning.
From plant despatch to last-mile delivery, the movement of cement involves various stakeholders such as transporters, distributors, and retailers. In India, the fragmented nature of the logistics ecosystem further complicates coordination. A study by PriceWater Cooper (PwC 2022) indicates that lack of integration across supply chain nodes can increase transit times by 10 per cent to 15 per cent, affecting project timelines and customer satisfaction.

Key challenges in end-to-end logistics
One of the biggest challenges in cement logistics is infrastructure limitation, particularly in rural and semi-urban areas where demand is rapidly growing. Despite improvements, India’s logistics infrastructure still faces bottlenecks such as poor road conditions, congestion, and limited rail connectivity. According to NITI Aayog (2021), logistics inefficiencies contribute to India’s overall logistics costs being around 13 per cent to 14 per cent of GDP, significantly higher than the global benchmark of 8 per cent to 9 per cent. For the cement industry, this translates into higher transportation costs and reduced competitiveness.
Professor Procyon Mukherjee says, “For decades, cement companies designed their networks around limestone availability. Plants were built near quarries, and finished cement was transported long distances to markets. This model, while logical from a production standpoint, created massive outbound logistics costs. Indian cement companies have begun to challenge this logic. The shift: decoupling clinker production from cement grinding.”
He adds, “Clinker plants remain near limestone reserves, but grinding units are increasingly located close to consumption centres. In many markets, logistics accounts for up to 30 per cent of total cost. The implication is stark: companies that redesign their end-to-end logistics, from inbound flows to last-mile delivery, can fundamentally alter their competitive position.”
Another critical challenge is demanding variability and lack of real-time visibility across the supply chain. Cement demand is highly seasonal and project-driven, making demand forecasting complex. Additionally, limited adoption of digital tools leads to poor tracking and coordination. According to McKinsey (2023), companies lacking digital logistics systems experience up to 20 per cent higher inefficiencies in fleet utilisation and delivery planning. These challenges highlight the need for greater integration, digitalisation, and infrastructure development to achieve efficient end-to-end logistics.

Multi-modal logistics
The integration of multiple transportation modes—road, rail, and coastal shipping—is becoming increasingly important for optimising cement logistics. While road transport dominates with over 70 per cent share, rail and coastal shipping offer cost-effective and environmentally sustainable alternatives for long-distance movement (NITI Aayog, 2021).
According to the Ministry of Ports, Shipping and Waterways (2023), coastal shipping can reduce logistics costs by up to 20 per cent to 25 per cent compared to road transport, while also lowering carbon emissions. The adoption of multi-modal logistics can help cement companies achieve better cost efficiency, reduce transit times, and improve supply chain resilience.
Anuradha Parakala, Co-founder, Chief Strategy and Product Officer, Fleetronix Systems, says, “Real-time visibility in logistics is no longer a competitive advantage. It has become a baseline requirement. The cost of not knowing what’s happening across the supply chain has simply become too high. Customers expect consistent and reliable deliveries, finance teams demand tighter cost control, and regulators require greater compliance and transparency. None of these expectations can be met without real-time insight into fleet movement and operations. What was once considered a differentiator is now essential, and companies that still operate without visibility are already falling behind in an increasingly performance-driven environment.
“At the same time, data-driven logistics is redefining how cement supply chains operate, shifting them from reactive systems to predictive, planning-led ecosystems. Fuel remains the single biggest cost lever in fleet logistics, and within that, driver behaviour offers the fastest and most impactful gains. It often delivers 12 per cent to 18 per cent fuel savings through better driving practices such as smoother acceleration, controlled speeds, and reduced idling. Beyond cost savings, data enables companies to move from guesswork to precision—anticipating disruptions, optimising routes, and planning with real numbers instead of buffers. The result is not just improved efficiency, but a stronger foundation of trust with customers, giving early adopters a clear and lasting competitive edge,” she adds.

Digitalisation of cement logistics
Digitalisation is transforming cement logistics by enabling real-time visibility, improved coordination, and data-driven decision-making. Technologies such as GPS tracking, IoT sensors, and advanced analytics allow companies to monitor shipments, optimise routes, and reduce delays. According to Gartner (2023), organisations that implement digital supply chain solutions can achieve up to 50 per cent improvement in supply chain visibility and 20 per cent reduction in operational costs. In the cement industry, where timely delivery is critical, such improvements can significantly enhance efficiency and customer satisfaction.
Dijam Panigrahi, Co-Founder and COO, GridRaster, says, the cement supply chain is uniquely complex. A single integrated plant may manage limestone quarrying, kiln operations, grinding, packing, and dispatch simultaneously, with finished product flowing through rail, road, and waterway networks to reach hundreds of regional depots and distribution points. Coordinating this network using spreadsheets, siloed ERP data, and phone calls is not merely inefficient; it is a structural liability in a competitive market where delivery reliability is a key differentiator. Digital twin technology offers a way out. A cement logistics digital twin is a continuously updated, three-dimensional virtual replica of the entire supply chain, from the truck loading bays at the plant to the inventory levels at district depots.”

Optimising fleet efficiency and last-mile delivery
Fleet efficiency is a critical factor in cement logistics, given the heavy reliance on road transport. Optimising fleet utilisation, reducing idle time, and improving route planning can lead to substantial cost savings. According to McKinsey (2022), optimised fleet management can reduce transportation costs by 10 per cent to 15 per cent, while improving delivery timelines. Technologies such as telematics, fuel monitoring systems, and driver behaviour analytics are increasingly being adopted to enhance fleet performance.
Pushpank Kaushik, CEO, Jassper Shipping, says, “Handling cement both in bulk and bagged form presents several operational challenges across the logistics chain. These include inadequate road infrastructure, port congestion during peak demand periods, and weather-related disruptions. At ports, limited mechanisation during high-volume periods can slow down cargo movement, increasing the risk of moisture exposure and product degradation. Jassper mitigates these challenges through its extensive operational expertise and global network. Managing a significant volume of vessel movements annually and working closely with experienced mariners and operators, we ensure precise coordination, efficient cargo handling, and smooth transitions across all logistics stages.”
Last-mile delivery, however, remains one of the most challenging aspects of cement logistics. Delivering cement to construction sites often involves navigating congested urban areas or remote rural locations, leading to delays and increased costs. A report by Deloitte (2023) highlights that last-mile logistics can account for up to 40 per cent of total delivery costs in certain scenarios. Addressing these challenges requires better route planning, localised distribution hubs, and increased use of technology to ensure timely and efficient delivery.

Sustainability in cement logistics
Sustainability is becoming a key focus area in cement logistics, driven by environmental regulations and corporate sustainability goals. Transportation is a major contributor to carbon emissions in the cement value chain. According to the International Energy Agency (IEA, 2023), logistics-related emissions account for a significant portion of the industry’s overall carbon footprint. Shifting towards rail and coastal shipping, improving fuel efficiency, and adopting alternative fuels can help reduce emissions. Additionally, optimising logistics operations not only lowers environmental impact but also reduces costs, creating a win-win scenario for the industry.

The future of cement logistics
The future lies in the adoption of automation, advanced analytics, and smart supply chain technologies. Autonomous vehicles, AI-driven planning systems, and blockchain-based tracking solutions are expected to redefine logistics operations. According to McKinsey (2023), companies that adopt advanced supply chain technologies can achieve up to 30 per cent improvement in efficiency and significant cost reductions. As the cement industry continues to evolve, the integration of these technologies will be crucial for building resilient, efficient, and future-ready logistics networks.

Conclusion
End-to-end logistics is no longer just an operational necessity but a strategic imperative for the cement industry. With rising costs, increasing demand, and evolving customer expectations, companies must focus on optimising their logistics networks to remain competitive. From multi-modal integration to digitalisation and sustainability, the future of cement logistics will be defined by innovation and efficiency.

  • – Kanika Mathur

Concrete

Cement Prices Likely to Rise Rs. 10-15 per Bag from Mid-October

Input costs and steady demand may drive cement price increases

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Cement manufacturers in India are likely to raise prices by Rs. 10-15 per bag from mid-October, as they seek to offset persistent increases in power and fuel costs. Emkay Research said its channel checks indicated a high probability of an increase from October 12, supported by the start of the busy construction season and favourable demand-supply conditions.

The sector had implemented similar rate adjustments of Rs. 10-15 per bag during the first quarter, but the increases were insufficient to cover higher operating costs. Prices also softened during July and August because of the monsoon, widening the gap between realisations and input expenses. Delayed plant expansion programmes have pushed clinker utilisation rates towards 79 per cent by FY28, helping to balance market fundamentals.

Emkay Research said steady volume offtake was supporting cement consumption, with non-trade demand driving activity across regional markets. Industry volumes are expected to grow by 7-8 per cent year on year during the first half of FY27, while demand momentum is projected to remain firm over the following 18 months. The outlook includes the busy construction season in the second half of FY27 and infrastructure activity linked to general elections in the first half of calendar year 2029.

The brokerage expects overall cement demand to record a compound annual growth rate of about 7 per cent between FY26 and FY28. However, elevated operating expenses are likely to continue weighing on profitability. Input costs have risen by Rs. 300-400 per t over the past six to seven months, with the full impact expected to become visible in second-quarter earnings and remain persistent through the second half of FY27.

Spot prices for petcoke and imported coal are approximately 20 per cent and 16 per cent above their second-quarter averages, at USD 175 per t and USD 150 per t, respectively. Packing costs have also increased, with polypropylene granule prices rising above Rs. 135 per kg. Emkay Research estimated that second-quarter earnings could decline by Rs. 200-250 per t sequentially because of higher fuel bills and negative operating leverage, and said the sector requires sustained price increases of about Rs. 10 per bag to offset cost inflation.

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Nuvoco Marks 10 Years, Targets 35 MMTPA Capacity by FY28

Nuvoco celebrates a decade of growth, targeting 35 MMTPA cement capacity by FY28.

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Nuvoco Vistas Corporation Limited is celebrating a decade of operations under the theme ‘Dus Saal Bemisaal’, highlighting its expansion in India’s building materials sector. The company has grown from a single cement manufacturing facility into a diversified organisation operating across cement, ready-mix concrete (RMC) and modern building materials.
The company’s journey began in 2014 when its parent, Nirma Group, commissioned a 2 million metric tonnes per annum (MMTPA) greenfield cement plant at Nimbol, Rajasthan. A major milestone followed in October 2016 with the acquisition of Lafarge India, significantly expanding its manufacturing footprint.
Nuvoco strengthened its market presence through the acquisition of Emami Cement, now NU Vista Limited, in 2020, followed by its public listing in 2021. In April 2025, the company added Vadraj Cement to its portfolio, strengthening its presence in western India.
Nuvoco has an operating cement capacity of 27 MMTPA and 14 manufacturing units, including the Kutch and Sachana facilities in Gujarat, which are in advanced stages of completion. It also operates 58 ready-mix concrete plants across India and offers a range of modern building materials.
The company aims to increase its cement capacity to 35 MMTPA by FY2027-28, representing approximately 15-fold growth over the decade.
Reflecting on the milestone, Hiren Patel, Chairman, Nuvoco Vistas Corporation Limited, said, “From our beginnings at Nimbol to the organisation we are today, every milestone has added a new chapter to Nuvoco’s journey and strengthened our belief in building for the long term.”
The company continues to focus on capacity expansion, operational efficiency, innovation and sustainability while strengthening its position in India’s construction materials market.

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J&K Government Notifies City Gas Distribution Policy

Policy targets PNG and CNG expansion across all 20 districts

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Jammu and Kashmir government has notified the City Gas Distribution (CGD) Policy, 2026, following its approval by the Council of Ministers headed by Chief Minister Omar Abdullah. The policy sets out a phased framework for expanding Piped Natural Gas (PNG) and Compressed Natural Gas (CNG) access for households, businesses, industries and the transport sector across the Union Territory.

CGD networks will be expanded in phases across all 20 districts, with the aim of bringing reliable natural gas closer to consumers and supporting a gradual shift from conventional fuels. The government said the policy is designed to improve energy access while creating an investor-friendly and time-bound environment for gas distribution projects.

The policy provides for single-window and time-bound clearances, streamlined procedures for setting up CNG stations and standardised norms for the Right of Way. These measures are intended to reduce procedural delays, simplify project implementation and facilitate investment in natural gas infrastructure.

It also prioritises gas connectivity for major industrial estates, including those in Kathua, Samba and Pulwama. Improved access to natural gas is expected to support industrial activity, enhance energy efficiency and help businesses manage fuel costs, while strengthening their competitiveness and encouraging investment in the clean-energy sector.

The policy is also expected to create opportunities for local employment, apprenticeships and skill development in the construction, operation and maintenance of gas distribution networks and related services. Abdullah described the measure as an important step towards cleaner growth, sustainable development and a modern energy ecosystem in Jammu and Kashmir, saying it would expand reliable energy access and support industry and investment.

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