Hike in diesel price make cement costlier

Hike in diesel price make cement costlier

In February, cement realisations increased but the increase was more because of cost escalations rather than an improvement in demand. The average price of a 50 kg cement bag was Rs 298 which was an increase of 6 per cent on a monthly basis with Eastern and Central regions witnessing the highest increase. The demand has failed to pick up in the month due to subdued off take from both the infrastructure and the housing sector.

The despatch figures released by the companies testify that the demand remained weak.UltraTech's despatches declined by 4.5 per cent on a year-on-year basis and Shree Cement's adjusted dispatches declined by 15 per cent. Issues of ban in sand mining and closure of brick kilns also depressed construction activities affecting cement off take. The companies have passed on the increase in diesel prices and hikes in railway freight to the consumers which have resulted in the price hikes. Northern region saw a slight increase of 5 per cent as supplies increased in few cities as a result of fresh despatches form Heidelberg cement.

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