Concrete

Bad News in New Year

Published

10 years ago

December 31, 2016

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This December, we were privileged to organise the ICR Cement Expo and Cement Conference concurrently. The theme of the conference was ‘Infrastructure to drive cement demand’. When we planned the conference a few months back, and narrowed down on to the proposed theme, it seemed perfectly logical that the cement demand would look up in 2017, and it also looked certain that new upcoming infrastructure projects will help drive up cement demand, duly aided by the positive effects of a great monsoon on rural housing demand.

Little did we know that on 8th November, an upheaval will be triggered in the economy in general, and in all such sectors which substantially transact in cash, including cement, and all our expectations based on industry analysis, would be rudely belied.

The sudden shock of demonetisation adversely impacted the trade or retail component of cement off-take, because at the cement counters of retailers all over India, bags are purchased mostly in cash. However, different regions of the country were affected differently in the early days of demonetisation. For example, in the early days post 8th November, southern markets withstood the shock much better than the eastern or northern markets. This discrepancy was mostly caused by the difference in the extent to which the cement makers in the regions pushed cement into the distribution pipeline ignoring the drop in retail off-take.

But as time passed, let’s say in December, the southern markets are drying up as well. Overall, the drop in demand has varied widely from 20 per cent to 70 per cent in different regional markets of India, and insiders say that this trend will continue into January 2017. In spite of brave attempts of cement players, prices have started sliding down as well, and some analysts say that prices have corrected by Rs 15-30/bag across markets. As a result, the stocks of cement companies have already fallen by 15-30 per cent since that fateful November day.

As if this was not enough, the industry has been also hit by increasing fuel prices, which account for at least 40 per cent of its cost structure. Prices of pet coke, imported coal and diesel are going up. According to the data from S&P Global Platts, pet coke and imported coal prices rose between 30 and 37 per cent between July and December. The companies and plants which are located far away from domestic coalfields and/or depended more on pet coke as fuel, are going to be affected sharply. Together with the demand shocker and softening of retail prices, this cost push is going to come as a double whammy for a number of cement companies. Margins of cement companies will get squeezed to various degrees as a result of all this.

Coming back to the theme of our conference, it seems that the government’s infrastructure investments, both in the Central and state sectors, will be the only saviour of the cement industry in the next 12 months. Even so, the infra players and EPC contractors, being volume buyers, have quite a lot of negotiating leverage, and therefore, overall profitability of cement is going to take a hit in relation to retail markets.

End of the day, it does seem that everything has got postponed by a year. Let us now gear up to face a year of tribulations, and look forward to 2018 for recovery of the industry. We would like to underline the fact that the fundamental strengths of the cement industry continue to be enduring in the longer term.

Concrete

Meghalaya Cabinet Approves MCCL Closure, Writes Off Rs. 244.3 mn

Cabinet approves winding up of state-owned cement company

Published

3 days ago

October 19, 2026

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The Meghalaya Cabinet has approved the closure and winding up of Meghalaya Cherra Cement (MCCL), a state-owned cement company, with pending liabilities of approximately Rs. 244.3 mn to be written off as part of the process. The decision was announced by Chief Minister Conrad K Sangma on October 13, 2026.

The approved write-off comprises about Rs. 89 mn in sales tax dues and Rs. 155.3 mn in royalty dues. The Cabinet’s decision addresses the liabilities that remained after the company’s operations and enables the government to proceed with its formal closure.

Sangma said employee dues owed by MCCL had been settled in line with the state government’s commitment. The settlement of employee-related liabilities is a key part of the winding-up process and removes outstanding obligations to the company’s workforce.

The Chief Minister explained that MCCL is owned by the government, meaning the pending liabilities would otherwise involve transfers between the state government and its departments. Writing off the dues is intended to simplify the accounting and administrative steps required to complete the closure.

The decision is also intended to ensure that the winding-up does not create an additional financial burden for the state government. With employee payments settled and the sales tax and royalty liabilities addressed through the approved write-off, the Cabinet’s approval marks a further step towards completing the formal closure of MCCL.

The action follows the state government’s decision to discontinue the company and resolve its outstanding obligations through an orderly winding-up process. The approved measures cover the principal liabilities identified for settlement and allow the government to advance the remaining formal procedures associated with closing the state-owned enterprise.

Concrete

Fornnax Wins AIRIA’s Special Export Award for Rubber Machinery in 2025-26

Published

4 days ago

October 19, 2026

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Fornnax Technology Pvt. Ltd. has been honoured with the Special Export Award – Rubber Machinery for 2025–26 by the All-India Rubber Industries Association (AIRIA), in recognition of its highest exports of tyre recycling plants to the European region.

With more than a decade of experience in India’s tyre recycling industry, Fornnax has contributed to the development of advanced recycling technologies and infrastructure. The company currently holds a 90% market share in India’s domestic tyre recycling sector, while exports account for 30% of its business, spanning markets such as Europe, Australia and the GCC.

The award marks another milestone for Fornnax, whose tyre recycling lines and advanced shredding technologies are supporting the growth of the circular economy in India and international markets.

Commenting on the recognition, Mr. Jignesh Kundaria, Founder and Director of Fornnax, said:

“This honour from AIRIA is a reflection of an incredible journey we have undertaken over the years. When we started Fornnax, there was no established recycling industry in India to follow. We chose to build for the future instead. Today, when you see India’s tyre recycling sector, it has already transformed into a dynamic, high-growth industry and we are extremely proud to have played our part in building it.”

Unlike standalone equipment suppliers, Fornnax focuses on developing complete, high-capacity recycling infrastructure. Its integrated systems combine multiple stages of shredding and size reduction to enable efficient, continuous operations. This system-level engineering approach helps recycling operators improve throughput, equipment reliability and operational consistency.

The recognition reinforces Fornnax’s commitment to developing engineering technologies that contribute to a more efficient and circular recycling ecosystem.

Looking ahead, the company aims to expand its international presence while continuing to develop advanced shredding and recycling solutions to address the growing volumes and evolving requirements of the global recycling industry.

For more information, visit: www.fornnax.com

Concrete

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

Input costs and steady demand may drive cement price increases

Published

1 week ago

October 14, 2026

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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.