Economy & Market

Monsoon Forecast Augurs Well for Rural Demand

Published

8 years ago

May 31, 2018

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The Indian Meteorological Department’s (IMD) second-stage forecast of ‘normal’ South-West monsoon (June-September 2018), augurs well for cement demand in rural areas. IMD has retained the forecast a normal monsoon at 97 per cent of long term average (LTA) for 2018 season retaining its first-stage forecast released in April 2018. India has seen a 95 per cent actual rainfall last year. Monsoon of between 96-104 per cent of LTA is considered to be normal. The forecast has a model error of 4 per cent on both sides.
If this forecast plays out as predicted, then FY19 (2018-19) will see the third consecutive year of normal monsoon bolstering agricultural income and boosting demand for cement for rural housing.
In the short run, rainfall is likely to be 101 per cent in July and 94 per cent in August, indicating good distribution for sowing and marginally below normal rainfall during harvesting. Geographically, both the critical regions-Central India and South Peninsula (due to high rain dependency)-are expected to receive normal rainfall, according to the forecast.
"Normal monsoon forecast is welcome for the agriculture sector, especially when international food prices are also stablising after persistent decline since mid-2014. This combination of normal monsoon with stabilising international prices at the margin should be supportive of farm incomes," says Kapil Gupta, analyst from Edelweiss Securities.

Distribution favourable
The spatial distribution is important as it determines the availability of water for specific crops. Crops such as cotton, oilseeds and pulses in particular are dependent on monsoon in peninsular India covering states like Maharashtra, Telengana, Andhra Pradesh, Tamil Nadu and Karnataka. Madhya Pradesh too is dependent on the SouthWest monsoon.
Spatially, rainfall is likely to be well distributed, although temporally rainfall is likely to be marginally below normal in August, which is not much of a concern. Central India and South Peninsula are expected to receive good rainfall at 99 per cent and 95 per cent of LTA, respectively. "This is critical because both the regions are heavily rain dependent and grow oilseeds, pulses, etc., of which India is a net importer," says Gupta.
"The July and August forecast means sowing and harvesting will by and large progress timely. From the inflation perspective as well, normal spatial and reasonable temporal rainfall distribution should result in benign food inflation," Gupta adds. Good tidings
The forecast indicates good tidings for the kharif crop. The kharif crop accounts for about 50 per cent of farm production while around 65 per cent of the production is rain dependent. The northern states have access to irrigation and hence crops like rice are well protected to an extent.
"For FY19, our base case, given a normal monsoon, is that agricultural growth will be 3 per cent – the same as in the previous fiscal. As for GDP growth during the fiscal, CRISIL’s forecast is at 7.5 per cent, up from 6.6 per cent in fiscal 2018," rating agency CRISIL said in April 2018, following the first IMD forecast.
A normal monsoon is crucial to push economic growth, which slowed last year under the lingering impact of demonetisation and disruptions due to implementation of the goods and services tax (GST), both of which impacted private consumption demand as well as exports.Normal monsoon generally heralds good
times for farmers and accelerates activity in rural economy, increasing demand for all agriculture related inputs and equipment, besides boosting demand for rural housing. But it cannot be taken for granted as the whole activity is nuanced by several interventions.
In this context, what CARE Ratings highlights these nuances when it said, "Rainfall per se is important, but in the last two years good monsoon has led to high production while prices have come down sharply affecting farm incomes. This has to be supplemented with effective MSPs which include ensuring availability of this price to the farmers."– BS SRINIVASALU REDDY

Concrete

JSW Cement commissions additional 1 MTPA grinding unit at Nagaur

Published

11 hours ago

October 8, 2026

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With this commissioning, JSW Cement’s total cement grinding capacity has increased to 25.10 MTPA,
Mumbai

JSW Cement, one of India’s leading green cement producers and part of the diversified JSW Group, today announced the successful commissioning of an additional 1.00 MTPA cement grinding unit at Nagaur, Rajasthan. The commissioning marks another significant milestone in the Company’s growth strategy.

With this commissioning, JSW Cement’s total cement grinding capacity has increased to 25.10 MTPA, while its total clinker manufacturing capacity, including clinker capacity at its joint venture, JSW Cement FZC, stands at 9.74 MTPA.

JSW Cement had commenced operations in North India in March 2026 with the Nagaur Integrated Plant, comprising a 3.30 MTPA clinkerisation unit and 2.50 MTPA cement grinding unit. With the commissioning of the additional 1.00 MTPA cement grinding unit, the plant’s total cement grinding capacity has increased to 3.50 MTPA, enhancing the company’s ability to cater to the growing cement demand across Rajasthan, Haryana, Punjab and the National Capital Region (NCR). The expansion has been funded through a strategic mix of equity and long-term debt.

During the quarter ended 30th September 2026, JSW Cement has also commissioned the Alternate Fuel Handling System and the Waste Heat Recovery system (WHRS) at the Nagaur Integrated Plant.

Nilesh Narwekar, CEO, JSW Cement, said: “The commissioning of additional 1.00 MTPA grinding capacity at Nagaur is a key strategic priority for us and will accelerate JSW Cement’s expansion into North India. We look forward to servicing the growing needs of the region and contributing to the economic growth of Rajasthan, Haryana, Punjab and the NCR area. I am delighted to share that the company has commissioned this grinding unit within the expected timeline, showcasing our project execution capabilities. Further, the Alternate Fuel Handling System and the Waste Heat Recovery system (WHRS) are expected to substantially reduce our production costs going forward.”

Concrete

UltraTech becomes first Indian cement firm to cross 2 GW green energy

Published

1 day ago

October 7, 2026

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UltraTech Cement has crossed 2 GW of captive green energy capacity, with renewables and waste heat recovery meeting 48 per cent of its power needs.

Mumbai

UltraTech Cement Limited has surpassed 2 GW of installed green energy capacity for captive use, becoming the first cement company in India to achieve the milestone. The Aditya Birla Group company commissioned 116.55 MW of wind capacity at its Inter-State Transmission System-connected wind-solar hybrid project in Barmer, Rajasthan, along with 10 MW of Waste Heat Recovery System capacity at Sarlanagar Cement Works in Karnataka.

With these additions, UltraTech’s cumulative installed green energy capacity has reached 2,024 MW. This includes 1,580 MW of renewable energy capacity and 444 MW of waste heat recovery capacity, together meeting around 48 per cent of the company’s current power requirements.

The company said the milestone reflects the progress of its long-term energy transition strategy. In FY27 so far, nearly one-third of UltraTech’s 76 manufacturing units in India have maintained green energy utilisation above 50 per cent of their electricity requirements, while five units have crossed 95 per cent.

K C Jhanwar, Managing Director, UltraTech Cement Limited, said, “Crossing the 2 GW green energy milestone is the result of a strategy we have pursued consistently over the past decade. Cement is an energy-intensive, hard-to-abate sector, and showing that reliability and growth can go hand in hand with a rapid shift to green energy sets a benchmark for the industry. With nearly half of our power needs now met through green energy, we are significantly less exposed to fossil fuel supply constraints and power price volatility. As we scale up renewables, waste heat recovery and battery storage across our operations, we are building an energy foundation for stable, long-term growth.”

UltraTech commissioned 430 MW of green energy capacity in FY26 and continues to expand its renewable energy and waste heat recovery portfolio.

The company is also progressively integrating Battery Energy Storage Systems across its operations to improve renewable energy utilisation and supply reliability.

In 2025, UltraTech operationalised what it described as India’s first on-site hybrid round-the-clock renewable energy project at Sewagram Cement Works in Gujarat. The project combines solar, wind and battery storage.

As part of its decarbonisation strategy, UltraTech said it has not invested in new captive thermal power capacity for either greenfield projects or brownfield expansions at its integrated units for more than a decade.

The company said its expanding green energy portfolio is helping reduce dependence on conventional grid electricity and fossil fuel-based power, while lowering exposure to fluctuations in coal and electricity prices.

UltraTech aims to increase green energy’s share in its total power mix to 85 per cent by 2030. As a member of RE100, it has also committed to meeting 100 per cent of its electricity requirement through renewable sources by 2050.

UltraTech Cement, the cement flagship of the Aditya Birla Group, has a total grey cement capacity of 210.1 MTPA and white cement and putty capacity of 3.5 MTPA. The company is also a signatory to the GCCA Climate Ambition 2050 and has committed to the GCCA Net Zero Concrete roadmap.

Concrete

Shiva Cement Merges with JSW Cement

Published

1 day ago

October 7, 2026

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JSW Cement has announced a scheme of arrangement to merge its listed subsidiary Shiva Cement with itself, creating a single unified cement platform. The boards of both companies have approved the proposal, which will require clearances from stock exchanges, the Securities and Exchange Board of India, the National Company Law Tribunal, Odisha Industrial Infrastructure Development Corporation and other applicable authorities.

The transaction is expected to be completed within 12 to 14 months, subject to the necessary approvals from regulators, shareholders and creditors. Under the scheme, JSW Cement will issue 5 equity shares with a face value of Rs. 10 each for every 41 equity shares with a face value of Rs. 2 each held by Shiva Cement shareholders other than JSW Cement.

The company said the merger would consolidate financial, managerial, technical, distribution and marketing resources while reducing administrative duplication and compliance requirements. It would also provide greater funding flexibility, potentially lower financing costs and eliminate inter-company guarantees.

The consolidation is expected to strengthen backward integration by enabling JSW Cement to use Shiva Cement’s clinker manufacturing facility. This would reduce dependence on external clinker procurement and improve supply-chain efficiency. Public shareholders of Shiva Cement would receive direct ownership in JSW Cement, which has a broader institutional investor base and a more liquid listed presence.

JSW Cement acquired a controlling stake in Shiva Cement through transactions that began in January 2017. Shiva Cement operates a clinker facility in Odisha, near the borders of Odisha, Chhattisgarh and Jharkhand, and commissioned a 1 mtpa cement grinding unit at Sambalpur in FY26 through a commercial arrangement with Bhushan Power and Steel.

JSW Cement has 24.10 mtpa of cement grinding capacity and 9.74 mtpa of clinkerisation capacity. Its Indian operations comprise nine plants, including two integrated units, one clinker unit and six grinding units. The proposed merger is intended to simplify the corporate structure and align the financial statements of the two companies.