Economy & Market
Capacity utilisation fall to 13-year low
According to the Cement Manufacturers Association the Indian cement industry, struggling with oversupply, saw capacity utilisation fall to a 13-year low of 83.9 per cent for 2010-11. The manufacturers have enjoyed an average utilisation of 90 per cent in the past decade. It stood 96 per cent in the past five years. The industry added capacity of 82 million tonnes per annum (mtpa) in the past two years, taking the total to 290 mtpa. The glut is felt more in the western and southern regions than the north, central and east (NCE). In the west and south, capacity utilisation fell to 75 per cent in 2010-11, as compared to 92 per cent in 2008-09. The extended monsoon, lacklustre response from real estate, hike in input costs and increase in cement prices are state as the causes for the low capacity utilisation of cement.