Cement prices fall due to seasonal weakness

Cement prices fall due to seasonal weakness

Cement prices in north, east, west and central India have fallen on a month-on-month (m-o-m) basis. Average cement prices in the north fell nearly 2-3 per cent m-o-m; in Delhi, the fall was to the extent of Rs 20-25 per bag. In the eastern region, prices dipped by around Rs 5-10 per bag, said a recent Edelweiss Securities Ltd report. The only exception was southern India. Prices in the states of Andhra Pradesh and Telangana have improved recently by around Rs 20-25 per bag over the previous month, an analyst with Reliance Securities said. However, cement prices haven´t dropped as sharply as they had during the same period last year.

For instance, in central India, prices corrected from Rs 270-275 per bag in Q1FY16 to Rs 230-238/a bag during the lean season last year; this year, it has corrected from Rs 300-305 per bag to Rs 270-280 per bag, mainly because of drought conditions prevailing last year.

The price correction gap has narrowed, but the cause for concern is the offtake in terms of volume hasn´t been significant despite the government´s efforts to push infrastructure activities.

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