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Poor road conditions across the country is a major challenge

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Srinath Manda, Program Manager, Transportation & Logistics Practice, Frost & Sullivan

How do you evaluate logistics in cement industry?
Logistics in cement industry typically means bulk cargo handling both in the inbound (sourcing) and outbound (distribution) side. Inbound logistics involves transporting limestone and other raw materials that do not involve any notable warehousing and value added activities, outbound logistics involves systematic transportation and storage activities, apart from a few value added services.

What are functional bottlenecks?
Due to the sensitive nature of the product (as cement is prone to damage by atmospheric humidity), outbound logistics involves careful handling of the product both in transportation and storage. The product needs to be weather proof in every stage of its distribution until it finally reaches the end-user. Ensuring its safety across the distribution chain is a major challenge for the cement industry.

Railways haul about 40 per cent of cement, what are the bottlenecks?
Even though railways is the most preferred inland transportation mode for the cement industry, lack of integrated rail connectivity from sourcing locations to plants and again from plants to last mile distribution points is the major issue faced by the industry.

What are the inwards and outwards logistics, the cost proportion?
While cement industry reportedly incurs around 15 percent of its turnover as logistics activities cost, inbound activity accounts for one-third of this cost and the remaining is incurred on outbound logistics.

What are preferred modes of transportation of cement?
As mentioned above, rail is the most preferred inland transportation mode of cement industry (mainly for long distance consignments) because large volume of consignments to major destination(s) across country can be sent in a single consignment. However, since railways are unable to offer end-to-end connectivity, road transportation has emerged as the most used transportation mode by this industry. Coastal shipping is also used in few parts of the country by cement companies.

What are the new challenges in road transport?
Poor road conditions across the country (especially for the last mile distribution) are a major challenge for the cement industry utilising road transportation. Rapid fuel price hike leading to frequent escalation of transport charges is another challenge. In addition, rising toll charges on highways is also adding to transportation costs for the industry.

What is the focus on logistics going ahead?
For the cement industry, the focus or trends that are expected to enhance efficiencies in logistics are:

  • Transportation using bulkers (specialised cement transport trucks that carry cement in bulk, similar to oil tankers) instead of the traditional mode of transporting cement bags through road/rail can be considered as a major development/innovation in cement logistics. This will result in significant savings in packaging costs.
  • Emergence/growth of "Ready Mix Concrete" industry has created another direct distribution channel between cement manufacturers and customers (ready mix companies in this case).
  • While the above two trends are likely to gain more significance in future, improvements in packaging technologies (such as improved packing materials, vacuum sealed packing etc) are also expected to gain prominence.
  • Realisation of Dedicated Freight Corridors (DFCs) by the Indian Railways (expected to be by 2015-16) is also likely to shift a significant share of cement transportation from road to rail mode.

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Concrete

Cement industry to gain from new infrastructure spending

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As per a news report, Karan Adani, ACC Chair, has said that he expects the cement industry to benefit from the an anticipated US$2.2tn in new public infrastructure spending between 2025 and 2030. In a statement he said that ACC has crossed the 100Mt/yr cement capacity milestone in April 2025, propelling the company to get closer to its ambitious 140Mt/yr target by the 2028 financial year. The company’s capacity corresponds to 15 per cent of an all-India installed capacity of 686Mt/yr.

Image source:https://cementplantsupplier.com/cement-manufacturing/emerging-trends-in-cement-manufacturing-technology/

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AI boom drives demand, says ACA

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The American Cement Association projects a nearly 1Mt annual increase in US cement demand over the next three years, driven by the surge in AI data centres. Consumption by data centres is expected to grow from 247,000 tonnes in 2025 to 860,000 tonnes by 2027. With over 5,400 AI data centres currently operating and numbers forecast to exceed 6,000 by 2027, the association cautions that regulatory hurdles and labour shortages may impact the industry’s ability to meet demand.

Image source:https://img-s-msn-com.akamaized.net/tenant/amp/entityid/AA1zOrih.img?w=2000&h=1362&m=4&q=79

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Concrete

GoldCrest Cement to build plant in India

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GoldCrest Cement will build a greenfield integrated plant with a 3.5Mt/yr clinker capacity and 4.5Mt/yr cement capacity. GoldCrest Cement appointed Humboldt Wedag India as engineering, procurement and construction contractor in March 2025 and targets completion by March 2027. It has signed a 40-year supply agreement with Gujarat Mineral Development Corporation for 150Mt of limestone from its upcoming Lakhpat Punrajpur mine in Gujarat.

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