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Cement capacity addition slows down

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Due to the recent slowdown in demand and the abundance of supply faced by the cement industry, the capacity addition in the sector is expected to decelerate to 16 million tonne (mt) in the current fiscal year and reduce even further to 13 mt in the next FY. However, the sector will be osbserving an anticipated investment of Rs 7,000 to 8,000 crore over the next two years.

In the last financial year, the sector had seen a 24 mt capacity addition compared to 27 mt in 2014-15. During 2007-2012, however, the sector witnessed a capacity addition of 149 mtpa (mt per annum), compared to 109 mtpa during 2013-16. Industry approximation put current capacity utilisation in the country at 64 per cent, down from 73 per cent in 2012. Sabyasachi Majumder, Senior Vice President and Group Head, ICRA Ratings, said "Cement firms need to first achieve an optimal utilisation of 70-80 per cent, after which commissioning of new plants would be viable".

"Our analysis suggests that while capacity utili-sation in the south remains weak, capacity addition in the region would be strong over the next two years. Additionally, the east, which was reeling under severe pricing pressure till about three months ago, is also likely to witness supply influx," according to an analyst from Motilal Oswal.

Eyeing a 40 mtpa capacity within the next five years, Shree Cement is at the forefront with a 2 mtpa project in West Bengal as well as Odisha, a 2.8 mtpa brownfield project in Chattisgarh and another in Karnataka which is over 2 mtpa. Emami cement, the newest entry, will be adding 5.5 mtpa capacity in Chattisgarh with two other projects in West Bengal and Odisha. Ultratech Cement plans to set up a 3.5 mtpa plant in Dhar, Madhya Pradesh. Penna Cement, Sagar Cement, KCP Industries and other major players from the south will also likely come up with capacity additions as well. "Capacity additions in cement beyond FY 2018 are expected to slow down further, given the lack of quality limestone resources," says ICRA report.

According to ICRA, setbacks in infrastructure projects due to concerns relating to land acquisition, hindrance in securing the necessary approval and problems in achieving financial closure have led to the recent slowdown in cement demand. "Slowdown in the pace of fresh capacity additions is expected to support cement prices going forward," ICRA added.

According to Centrum Broking, the cement firms had anticipated the forthcoming demand during 2008-2010 based on which they had opted to up their production capacity.

"However, the demand didn’t grow as expected and thus capacity utilisations are on the lower side. Under the present circumstances, there is actually no need to go for greenfield projects," Centrum Broking further added.

Capacity addition was at its highest in 2011, when cement firms added about 45 mt of capacity. Although the predicted growth of the segment was 10 per cent, the growth rate has been steady at 5-7 per cent in the last few years. Centrum expects the growth to show a marginal increase and go up to 7-8 per cent in the coming fiscal year.

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Economy & Market

TSR Will Define Which Cement Companies Win India’s Net-Zero Race

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Jignesh Kundaria, Director and CEO, Fornnax Technology

India is simultaneously grappling with two crises: a mounting waste emergency and an urgent need to decarbonise its most carbon-intensive industries. The cement sector, the second-largest in the world and the backbone of the nation’s infrastructure ambitions, sits at the centre of both. It consumes enormous quantities of fossil fuel, and it has the technical capacity to consume something else entirely: the waste our cities cannot get rid of.

According to CPCB and NITI Aayog projections, India generates approximately 62.4 million tonnes of municipal solid waste annually, with that figure expected to reach 165 million tonnes by 2030. Much of this waste is energy-rich and non-recyclable. At the same time, cement kilns operate at material temperatures of approximately 1,450 degrees Celsius, with gas temperatures reaching 2,000 degrees. This high-temperature environment is ideal for co-processing, ensuring the complete thermal destruction of organic compounds without generating toxic residues. The physics are in our favour. The infrastructure is not.

Pre-processing is not the support act for co-processing. It is the main event. Get the particle size wrong, get the moisture wrong, get the calorific value wrong and your kiln thermal stability will suffer the consequences.

The Regulatory Push Is Real

The Solid Waste Management (SWM) Rules 2026 mandate that cement plants progressively replace solid fossil fuels with Refuse-Derived Fuel (RDF), starting at a 5 per cent baseline and scaling to 15 per cent within six years. NITI Aayog’s 2026 Roadmap for Cement Sector Decarbonisation targets 20 to 25 per cent Thermal Substitution Rate (TSR) by 2030. Beyond compliance, every tonne of coal replaced by RDF generates measurable carbon reductions which is monetisable under India’s emerging Carbon Credit Trading Scheme (CCTS). TSR is no longer a sustainability metric. It is a financial lever.

Yet our own field assessments across multiple Indian cement plants reveal a sobering reality: the primary barrier to scaling AFR adoption is not waste availability. It is the fragmented and under-engineered pre-processing ecosystem that sits between the waste and the kiln.

Why Indian Waste Is a Different Engineering Problem

Indian municipal solid waste is not the material that imported shredding equipment was designed for. Our waste streams frequently exceed 40 per cent to 50 per cent moisture content, particularly during monsoon cycles, saturated with abrasive inerts including sand, glass, and stone. Plants relying on imported OEM equipment face months of downtime awaiting proprietary spare parts. Machines built for segregated, low-moisture waste fail quickly and disrupt the entire pre-processing operation in Indian conditions.

The two most common failures we observe are what I call the biting teeth problem and the chewing teeth problem. Plants relying solely on a primary shredder reduce bulk waste to large fractions, but the output remains too coarse for stable kiln combustion. Others attempt to use a secondary shredder as a standalone unit without a primary stage to pre-size the feed, leading to catastrophic mechanical failure. When both stages are present but mismatched in throughput capacity, the system becomes a bottleneck. Achieving the 40 to 70 tonnes per hour required for meaningful coal displacement demands a precisely coordinated two-stage process.

Engineering a Made-in-India Answer

At Fornnax, our response to these challenges is grounded in one principle: Indian waste demands Indian engineering. Our systems are built around feedstock homogeneity, the holy grail of kiln stability. Consistent particle size and predictable calorific value are the foundation of stable kiln combustion. Without them, no TSR target is achievable at scale.

Our SR-MAX2500 Dual Shaft Primary Shredder (Hydraulic Drive) processes raw, baled, or loosely mixed MSW, C&I waste, bulky waste, and plastics, reducing them to approximately 150 mm fractions at throughputs of up to 40 tonnes per hour. The R-MAX 3300 Single Shaft Secondary Shredder (Hydraulic Drive), introduced in 2025, takes that primary output and produces RDF fractions in the 30 to 80 mm range at up to 30 tonnes per hour, specifically optimised for consistent kiln feeding. We have also introduced electric drive configurations under the SR-100 HD series, with capacities between 5 and 40 tonnes per hour, already operational at a leading Indian waste-processing facility.

Looking ahead, Fornnax is expanding its portfolio with the upcoming SR-MAX3600 Hydraulic Drive primary shredder at up to 70 tonnes per hour and the R-MAX2100 Hydraulic drive secondary shredder at up to 20 tonnes per hour, designed specifically for the large-scale throughput that higher TSR ambitions require.

The Investment Case Is Now

The 2070 Net-Zero target is not a distant goal for India’s cement sector. It starts today, with decisions being made on the plant floor.

The SWM Rules 2026 are already in effect, requiring cement plants to replace coal with RDF. Carbon credit markets are opening up, and coal prices are not going to get cheaper. Every tonne of coal a cement plant replaces with waste-derived fuel saves money on one side and generates carbon credit revenue on the other. Pre-processing infrastructure is no longer just a compliance requirement. It is a business investment with a measurable return.

The good news is that nothing is missing. The technology works. The waste is available in every Indian city. The government has provided the policy direction. The only thing standing between where the industry is today and where it needs to be is the commitment to build the right infrastructure.

The cement companies that move now will not just meet the regulations. They will be ahead of every competitor that waits.

About The Author

Jignesh Kundaria is the Director and CEO of Fornnax Technology. Over an experience spanning more than two decades in the recycling industry, he has established himself as one of India’s foremost voices on waste-to-fuel technology and alternative fuel infrastructure.

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Concrete

WCA Welcomes SiloConnect as associate corporate member

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The World Cement Association (WCA) has announced SiloConnect as its newest associate corporate member, expanding its network of technology providers supporting digitalisation in the cement industry. SiloConnect offers smart sensor technology that provides real-time visibility of cement inventory levels at customer silos, enabling producers to monitor stock remotely and plan deliveries more efficiently. The solution helps companies move from reactive to proactive logistics, improving delivery planning, operational efficiency and safety by reducing manual inspections. The technology is already used by major cement producers such as Holcim, Cemex and Heidelberg Materials and is deployed across more than 30 countries worldwide.

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Concrete

TotalEnergies and Holcim Launch Floating Solar Plant in Belgium

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TotalEnergies and Holcim have commissioned a floating solar power plant in Obourg, Belgium, built on a rehabilitated former chalk quarry that has been converted into a lake. The project has a generation capacity of 31 MW and produces around 30 GWh of renewable electricity annually, which will be used to power Holcim’s nearby industrial operations. The project is currently the largest floating solar installation in Europe dedicated entirely to industrial self-consumption. To ensure minimal impact on the surrounding landscape, more than 700 metres of horizontal directional drilling were used to connect the solar installation to the electrical substation. The project reflects ongoing collaboration between the two companies to support industrial decarbonisation through renewable energy solutions and innovative infrastructure development.

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