According to the report in ICRA, the domestic cement sales in the April-June quarter has reduced to almost 25% on a quarter-on-quarter basis but it may change in the next quarter with the pent-up demand caused by the Lockdown. A report by SURFACES REPORTER (SR).
According to the global rating agency, the domestic production took a hit in the April 2021 when the state-wise lockdown was in effect and was down 35% month-on-month which was 4% lower in comparison with the pre-pandemic April 2019. Unlike last year, rural areas have also been impacted in the second wave.
“The recovery in the rural regions is expected to be gradual,” it said. However, it added that pent-up demand is likely to drive offtake once lockdowns are relaxed.
ICRA AVP and sector head Anupama Reddy said cement firms have raised prices by an average of 5% in April from a year earlier, spurred by the rise in input costs, primarily power & fuel and freight expenses.
Construction Worker Association urges to reduce prices
In the wake of the continous increase in the prices of cement and other construction materials, Tamil Nadu AITUC Construction Workers Association has urged the State government to take steps to reduce the prices.
K. Ravi, General Secretary of the association, in a letter to the Chief Minister, said the price of cement and other materials had gone up by over 30% in the past one month, affecting the public and also resulting in delay in completion of government projects. Though the government could bear the additional cost, the public could not bear the cost. Also, it affected the livelihood of lakh of construction workers.
The letter said the price of all the materials had gone up only after the Assembly elections held in May and wanted the prices revised. Price of materials before and after the election was: one bag cement ? 370 to ? 570, one unit of M-sand ? 5,000 to ? 6,000, one unit of sand ? 6,000 to ? 8,000, blue metal stone ? 3,500 to ? 5,000, bricks ? 23,000 to ? 27,000 and one tonne steel increased from ? 58,000 to ? 72,000 now.
Cement Manufacturers Association in India (CMA) fixed the price of cement for each States in the country. The price of cement was higher by ? 120 in the State when compared to the price in Andhra Pradesh and the Chief Minister should intervene and regulate price fixation. The letter urged the Chief Minister to take steps on a war footing and revise the price of materials as prevailed before the election.
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